COMPANY LAW / CORPORATE LAW IN GHANA - COMPANY LAW IN GHANA- CORPORATE FINANCE - SHARES ( 2) - Sec 42 to 48 Companies Act 2019 (Act 992)

Legal Nature of Shares under the Companies Act, 2019 (Act 992) Shares in a company are classified as movable property under Ghana's Companies Act, 2019 (Act 992). Their number, rights, and liabilities are determined by the terms of issue. Ghanaian law provides for no par value shares, meaning shares are not issued with a nominal or face value but are valued based on what investors are willing to pay. Membership and Liability A company must have at least one member to continue as a legal entity. If a company ceases to have members but continues operating, its directors become personally liable for debts incurred during this period. In companies limited by guarantee, a member’s liability upon winding up is restricted to the amount they agreed to contribute. A member’s dividends or entitlements cannot be set off against their liability for unpaid contributions. Additionally, the estate of a deceased past member may still be liable for contributions if they were outstanding at the time of death. Generally, however, shareholders are not personally liable for company debts unless otherwise stated. Issuance and Payment for Shares Companies may issue different classes of shares at times and for considerations they determine, subject to their registered constitution. When winding up, both past and present shareholders are liable for contributions in accordance with the Act. Shares must not be issued without valuable consideration unless issued under capitalisation (i.e., converting reserves into shares). Generally, payment must be made in cash, but non-cash payments (such as property or services) are allowed if properly recorded. A company must file a written contract with the Registrar within 28 days when issuing shares for non-cash consideration. If the true value of non-cash consideration is later found to be overstated, a court may declare those shares partially unpaid and require additional contributions. Return of Share Issues and Compliance After issuing shares, a company must file a return with the Registrar within 28 days, detailing: Stated capital and how it is distributed Authorized shares of each class Issued shares and amounts paid Treasury shares (if any) Failure to comply with sections 45 or 46 attracts a penalty of 25 penalty units per day. Meaning of Cash Payment A share is considered paid in cash only if the company has actually received cash. If shares are issued in exchange for property or services, only the excess of cash paid over the value of the non-cash consideration is considered a cash payment.