PART 4Protected Cell Companies
CHAPTER 9Shares and shareholders
SECTION 5Share transfers
General119
1
Shares issued by a protected cell company are transferable in accordance with the protected cell company's instrument of incorporation.
2
Where a person holding shares issued by a protected cell company transfers those shares to another person (the “transferee”), legal title to those shares only passes to the transferee when the transferee is registered as the owner of those shares by the protected cell company.
3
The instrument of incorporation of a protected cell company may contain provision as to share transfers in respect of any matter for which provision is not made by this Part.
Meaning of “transfer documents”120
1
In this Section, “transfer documents” means—
a
one or more of the documents falling within Category 1;
b
one or more of the documents falling within Category 2; and
c
such other evidence (if any) as the protected cell company may require to prove—
i
the right of the transferor to transfer the shares in question; or
ii
the eligibility of the transferee to acquire the shares in question.
2
The following documents fall within Category 1—
a
b
an order made by the court under regulation 175 (application for court order sanctioning transfer scheme) or 177 (effect of court order sanctioning transfer scheme) for the transfer of shares;
c
any other instrument of transfer as is authorised by, and completed and executed in accordance with, any requirement in the protected cell company's instrument of incorporation;
3
The following documents fall within Category 2—
a
a share certificate relating to the shares in question;
b
if the shares in question fall within sub-paragraph (a) or (b) of regulation 110(1), such evidence of title to those shares as is required by the protected cell company's instrument of incorporation.
Transfers121
1
A protected cell company may not register a transfer of shares unless—
a
the transfer documents relating to the transfer have been delivered to the protected cell company; or
b
title to the shares has been transmitted by operation of law.
2
Where transfer documents relating to a share transfer are delivered to a protected cell company, the protected cell company must amend the register of shareholders and index accordingly.
3
But a protected cell company may refuse to register a transfer of shares where—
a
a person holding shares issued on behalf of a part of the protected cell company is required to hold less or more than a specified number of shares issued on behalf of that part and the transfer would result in the transferor or transferee breaching that requirement;
b
the transfer would contravene a provision of the protected cell company's instrument of incorporation or a provision of law (including any law that is for the time being in force in a country or territory outside of the United Kingdom); or
c
the transferee fails to provide the protected cell company with such evidence as the protected cell company may reasonably require to satisfy the protected cell company that the transferee is a qualified investor within the meaning given by regulation 10.
4
A protected cell company—
a
may only refuse to register a transfer pursuant to sub-paragraph (a) or (b) of paragraph (3) during the period of 21 days commencing with the date the transfer documents are delivered to the protected cell company; and
b
must give the transferee written notice of a refusal to register a transfer of shares, unless the giving of such a notice would contravene a provision of law (including any law that is for the time being in force in a country or territory outside of the United Kingdom).
5
A transfer of shares by the personal representative of a deceased person is valid as if the personal representative had been the holder of the deceased person's shares at the time of the execution of the instrument of transfer.
Certification of transfer122
1
Where, in respect of a transfer of shares, a protected cell company certifies that it has received the transfer documents, that certification is to be taken as a representation by the protected cell company to any person acting in reliance on the certification that there has been produced to the protected cell company sufficient evidence to show that the transferor has title to the shares in the absence of proof to the contrary.
2
A certification is made by a protected cell company if the instrument of transfer—
a
bears the words “ certificate lodged” or words to the like effect; and
b
is signed by a person acting under authority (whether express or implied) given by the protected cell company to issue and sign such certificates.
3
But a certificate is not to be taken as a representation that the transferor has any title to the shares in question.
4
Where a person acts in reliance on a false certification by a protected cell company which is made negligently or fraudulently, the protected cell company is liable to pay that person out of assets held by the protected cell company on behalf of the core any damages that the person has sustained.
Joint shareholdings123
On the death of any one of the joint holders of a share, the survivors are to be the only persons recognised by the protected cell company as having any title to or any interest in those shares.