One major question that bothers many Nigerians today is on the possible ways for an individual to legally own shares in a company. According to the provisions of the Companies and Allied Matters Act (CAMA) 2020, there are three ways a person can own shares in a company, and they include:
1. SUBSCRIPTIOn
This happens at the incorporation stage, and any time a company creates new shares for issue. At incorporation, a person who wants to own part of a company can “subscribe” to own new shares created at incorporation. By doing so, the person automatically becomes a shareholder of the company. If the shares are created later, a person can “subscribe” for the newly created shares to own a part of the company.
TRANSFER OF SHARES: This happens when a shareholder in a company decides to transfer part or all of his shares to another person. For example, if A is a shareholder in XYZ company, and B wants to purchase the shares of A. In this instance, you are not buying directly from the company but from a shareholder. Transfer can be:
(a) for value i.e. a price
(b) nominal, i.e. an insignificant amount, e.g. ₦1.00
(c) by way of a gift, i.e. free.
TRANSMISSION OF SHARES: This happens when a shareholder dies and their estate or specific people mentioned in their will or trust is vested with the shares of the deceased shareholder.
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