Share certificate

In a share sale, the seller hands over the shares. Whether that means a paper certificate depends on the corporation and its statute. A buyer asking for the certificates is checking what the seller says they own against the company’s records, as discussed in whether a share buyer is bound by a shareholders’ agreement they never saw.

Federal corporations

Section 49 of the Canada Business Corporations Act entitles every security holder, at their option, to a security certificate, or to a non-transferable written acknowledgment of their right to obtain one. A share certificate must state, on its face, the corporation’s name, the words “Incorporated under the Canada Business Corporations Act” or “subject to the Canada Business Corporations Act”, the name of the person to whom it was issued, and the number and class of shares and any series. The section also addresses restrictions noted on certificates.

Ontario corporations

Section 54 of Ontario’s Business Corporations Act says a security may be represented by a security certificate or may be an uncertificated security, so an Ontario corporation’s shares may have no paper certificate at all. Other provinces differ. See the securities register for the record behind it.