Is member as same as shoreholder?
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LWIs member as same as shoreholder?
Hi
No, a "member" is not necessarily the same as "shareholder" in the context of company law ( which is presumably the area you are referring to ).
By statutory definition, a person is a member of a company when their name appears in the register of members. Thus, it is theoretically possible to be a member but not a shareholder, or a shareholder and not a member.
Here are some possibilities!
The owner of "Bearer" shares ( common in the USA ) is a shareholder but not a member.
The joint owner of shares who has chosen not to have his / her name registered is a shareholder but not a member.
If I held shares which I have now sold, for a short period I would still be a member but not a shareholder, and the buyer would be a shareholder but not a member.
The law prevents any notice of a Trust in the register of members. Therefore, a trustee will be registered as a member in their own name, but they are not the beneficially interested person. So a trustee will be a member but not a shareholder whereas the beneficiary will be a shareholder and not a member.
HOWEVER!!!!! For the sake of F4, it is MOST UNLIKELY that a marker will drop you a mark if you use the technically incorrect word. In lectures I find that I use both words as though they were synonymous.
And finally! There was a past exam question from MANY years ago which asked for the distinction between a member and a shareholder in the context of company law!
Happier?
No, a "member" is not necessarily the same as "shareholder" in the context of company law ( which is presumably the area you are referring to ).
By statutory definition, a person is a member of a company when their name appears in the register of members. Thus, it is theoretically possible to be a member but not a shareholder, or a shareholder and not a member.
Here are some possibilities!
The owner of "Bearer" shares ( common in the USA ) is a shareholder but not a member.
The joint owner of shares who has chosen not to have his / her name registered is a shareholder but not a member.
If I held shares which I have now sold, for a short period I would still be a member but not a shareholder, and the buyer would be a shareholder but not a member.
The law prevents any notice of a Trust in the register of members. Therefore, a trustee will be registered as a member in their own name, but they are not the beneficially interested person. So a trustee will be a member but not a shareholder whereas the beneficiary will be a shareholder and not a member.
HOWEVER!!!!! For the sake of F4, it is MOST UNLIKELY that a marker will drop you a mark if you use the technically incorrect word. In lectures I find that I use both words as though they were synonymous.
And finally! There was a past exam question from MANY years ago which asked for the distinction between a member and a shareholder in the context of company law!
Happier?
[ol]
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