Can a limited company issue bearer shares

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Please upgrade your browser to improve your experience. Luxembourg Public limited liability companies SA and corporate partnerships limited by shares can issue bearer shares. There are strict regulations regarding holding and keeping bearer shares.

Company Law Club : Abolition of bearer shares

As a result of this regulation, bearer shares must be held by a professional depositary as for example a Luxembourg CPA. Bearer shares must be deposited with a professional depositary located in Luxembourg which can be one of the following:. The depositary is selected by the company and each shareholder must deposit their bearer shares with that depositary.

The identity of the depositary must be available to the public through Luxembourg's Trade Register. The depositary does not have the right to relinquish the deposited shares to any party other than another certified Luxembourg depositary that is appointed by the company.

This implies also that the depositary does not have the right to return bearer shares directly to the shareholders. The depositary of bearer shares must issue a certificate of deposit to each shareholder to allow the shareholder owning the bearer shares to participate in General Shareholders Meetings.

The custodian must have a bearer shares register indicating the name of each shareholder, the number of shares held and any transfers. The transfer of bearer shares is enforceable by registering the transfer in the bearer shares register. Bearer shares cannot confer rights namely, the right to participate or vote in the General Shareholders Meeting and to receive dividends unless these bearer shares are deposited through an depositary.

Bearer shares which are not deposited do not confer any rights. We remind you that before this law came into effect, bearer shares could be owned and held without any formalities and each shareholder was free to hold the bearer shares as he or she saw fit at home for example and bearer shares could be transferred in a simple manner. Once the law on the immobilization of bearer shares went into effect, existing companies must come into compliance with this law:.

Frequently Asked Questions - 4Business

Bearer shares which are not deposited within 18 months must be cancelled through a corresponding reduction in share capital. Shareholders have 12 months to deposit their bearer shares with the depositary, and their bearer shares are suspended until the deposit is carried out which should be finalized before 17 th February As from 18 th February Bearer shares which have not yet been deposited must be cancelled and the share capital of the company in question must be reduced by the corresponding amount.

Memorial A number of August 14, June , publication of the new edition of the Handbook on Luxembourg Accounting Law, by Denis Colin, Director of LPG group. Our Interventions Publications The Group Contact Search. The depositary's role is to hold the bearer shares on behalf of the shareholder.

BEARER SHARES REGISTER The custodian must have a bearer shares register indicating the name of each shareholder, the number of shares held and any transfers.

Once the law on the immobilization of bearer shares went into effect, existing companies must come into compliance with this law: Similar Publications Business Taxation The SOPARFI: Corporate law Partnerships limited by shares Luxembourg SCA.

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