In Lesotho a transfer of shares becomes effective when the company records the transferee as the holder on its share register, and this is always subject to the company’s articles of incorporation. To start the process the company must receive a properly completed form of transfer that is signed by the current holder of the shares or by that person’s personal representative, as well as by the transferee. Once that form reaches the company, the company is obliged to enter the transferee on the register within fifteen days, unless the board resolves within fifteen working days to refuse or to delay registration and the resolution sets out full reasons. If the board adopts such a resolution the company must send written notice of the decision and the reasons to both the transferor and the transferee within fifteen working days after the resolution is approved. The articles may also state specific grounds on which the board may refuse or delay registration, and if they do the board may act on those grounds only to the extent clearly authorised.
Even where the articles are silent the board may refuse or defer a transfer if the holder has not paid amounts due to the company in respect of the shares, whether those amounts relate to consideration for the original issue or to sums payable under the articles. Shares can also pass by operation of law despite restrictions in the articles, for example on death, insolvency, or pursuant to a court order, and in those circumstances the company must update the register when it receives satisfactory proof.
A careful workflow helps company secretaries and directors meet these timelines. First, review the articles to identify any pre-emptive rights, approvals, or other restrictions and to confirm whether the board is empowered to refuse or delay for stated reasons. Next, confirm that the transfer form is correctly executed by the transferor or personal representative and by the transferee, that authority and identity have been verified, and that any consideration has been dealt with in accordance with the articles and the law. If a decision of the board is required, table the matter at a properly convened meeting and minute the decision in full. Where the board decides to register, instruct that the register be updated within fifteen days of receipt of the transfer form and that a new share certificate be issued with the old certificate cancelled or endorsed. Where the board refuses or delays, send detailed written reasons to both parties within the required period and keep an auditable record of the decision and the notices sent. Maintain a complete file comprising the transfer form, approvals, minutes, notices, know your client documents, and an extract of the updated share register.
Clear and consistent documentation reduces dispute risk. Approval wording might read as follows: “The board notes receipt on [date] of a duly executed transfer from [transferor] to [transferee] in respect of [number] shares, confirms compliance with the Companies Act and the articles, and resolves that the register be updated and a new share certificate issued.” Refusal wording might read as follows: “Having considered the transfer delivered on [date] the board resolves to refuse or delay registration for the following reasons [set out reasons in full]. The company secretary is instructed to notify the transferor and the transferee in writing of this resolution and the reasons within fifteen working days.”
For anyone searching for transfer of shares in Lesotho, Lesotho Companies Act share register, or board refusal of share transfer in Lesotho, the key points are that title follows registration, that the company must act within fixed fifteen day and fifteen working day windows, that any refusal must be reasoned and notified to both parties, and that transfers by operation of law require the company to update the register once proper proof is provided.