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Querist : Anonymous

Querist : Anonymous (Querist)

10 October 2011 what is the difference between shareholders and members of a company?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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10 October 2011 Pl see certain distinctions given below:-

A person who subscribes to the memorandum of association immediately becomes the member even though no shares are allotted to him/her. In case shares are not allotted to the subscriber, he/she is a member but not shareholder of the company.

A person who acquires the shares in the open market may be a shareholder but he/she does not become the member automatically. It is only when the name of the transferee is entered in the register of members that he/she becomes the member. Until then he/she is just a shareholder and not a member.

In case of company limited by guarantee having no share capital or unlimited company having no share capital there will be only members and no shareholders.

Holder of a share warrant is a shareholder of the company but not a member as his /her name is struck off the register of members.

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