Skip to main content

Legal Update

So what does a "shareholder", "member" and "holder" of shares really mean?

February 2013
Mayer Brown Legal Update

Many English law governed agreements invoke Companies Act 2006 ("CA06") definitions for standard terms such as "shareholder". A recent decision confirms that only those persons whose names appear in a company's share register qualify as a "shareholder", "member" or "holder" of shares (the terms are interchangeable) for CA06 purposes.

English law distinguishes between legal and beneficial title to shares. Share registers only record persons who hold legal title to shares. Ultimate owners of the economic interest in shares will not appear on the share register. In many cases, the underlying owner is not disadvantaged as they have de-facto dividend, voting and information rights through contracts with the registered member. But, as the decision confirms, they cannot exercise CA06 minority shareholder protections (e.g. an application to overturn a resolution to re-register a public company as private) in person.

The case also reiterates that, if a registered shareholder holding shares on behalf of a number of persons votes (through the appointment of proxies) both for and against a resolution, they are still a person who has voted in favour of the resolution so exempting them (and the underlying owners) from various minority protections in CA06.


  • Kate Ball-Dodd
    T +44 20 3130 3611
  • Annabel Evans
    Professional Support Lawyer
    T +44 20 3130 3858
The Build a Report feature requires the use of cookies to function properly. Cookies are small text files that are placed on your computer by websites that you visit. They are widely used in order to make websites work, or work more efficiently. If you do not accept cookies, this function will not work. For more information please see our Privacy Policy

You have no pages selected. Please select pages to email then resubmit.