AUTHOR: TATTON BOURAS
PUBLICATION DATE: 27TH JANUARY 2026
Corporate compliance is often described as a journey and not a destination. This is because companies are required to continuously take steps to adhere to both existing and changing laws, regulations and standards. It is an infinite exercise that must be undertaken by companies. Notwithstanding this, it is often the case that companies prioritise compliance requirements according to their importance and the sanction and/or penalty imposed for non-compliance thereof.
One of the compliance requirements in terms of the Companies Act No 71 of 2008 (“the Act”) that is usually forgotten and/or ranked as a low level of priority, is maintaining and updating the securities register or otherwise known as a shares register. Section 50(1) of the Act requires that every company must establish a shares register and must maintain same. Our courts have accepted that a share register is prima facie proof that a person owns shares in a company. Notwithstanding this, many companies have not updated their share registers and owners rely on share certificates as prima facie proof of ownership.
In the recent case of Graham NO and Others v Reyneke and Others (2024/050337) [2025] ZAGPPHC 1303 (28 November 2025), the court dealt with a dispute of possession of shares and the importance of the share register was reiterated by the court. The court held that the share register was prima facie proof of ownership, and anyone disputing same would have the burden of proof. The court highlighted that a share register is mandatory and plays a vital role in determining ownership. It is often the case that employees are “given shares” and/or friends and business partners buy and sell or transfer shares to one another, and a dispute arises regarding ownership, and because the share register has not updated, the burden of proof becomes onerous on the party alleging ownership. While this requirement may seem unimportant, it places a significant role in determining ownership of shares. In addition, since the introduction of beneficial ownership requirements in South Africa, submitting and maintaining a proper beneficial ownership register along with an up-to date share register is a key compliance requirement for companies.
It is worth ticking the box and ensuring that If you are a shareholder, you are correctly reflected in the share register. In this new year of compliance for your company, make sure that you are not repeating bad old habits and are implementing good corporate governance.
Tel: +27 31 570 5336, email: tatton.bouras@gb.co.za