Companies Act 2014 section 1019

Provisions as to shares transferable by delivery (general prohibition and provision for certain letters of allotment)

Section 1019 prohibits public limited companies from issuing bearer instruments (shares transferable by delivery of the instrument) while providing a narrow exception for certain short-lived letters of allotment and a transitional regime for existing bearer instruments.

• PLCs are generally prohibited from issuing bearer instruments; any purported issue renders the shares void and creates a debt obligation to repay the subscriber
• A narrow exception exists for "permissible letters of allotment" covering bonus shares, shares in lieu of dividends, and shares issued under rights issues or open offers, each transferable by delivery for up to 30 days only
• Existing bearer instruments at commencement had to be converted to registered form within 18 months, with holders' names entered on the register of members
• Where holders of existing bearer instruments failed to come forward within the 18-month window, the Minister for Finance became the full beneficial owner of the shares concerned

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