If your company’s share ledger does not meet the legal and formal requirements of the Swedish Companies Act, the company should immediately reconstruct the share ledger. The general rule is that the only way to do this is through a so-called full reconstruction. This means recreating the complete history of the share ledger from the moment the company was founded up to the present date.
It is worth noting that the Swedish Companies Act allows the full history of the share ledger to go back only 10 years if the company transitions from maintaining a paper-based share ledger to a digital one, i.e., using NVR’s system service for share ledger administration.
If the identity or contact details of a shareholder are unknown to the company, the company can simply note in the share ledger that the owner of the shareholding is unknown or that the contact details are unknown. The company’s board members are not required to search for the identities of individual shareholders. The following sections present a methodology that will guide you in the work of reconstructing your company’s share ledger. Step-by-step, you will be instructed on which documents to gather, how to phrase them, and how to enter the information into NVR’s system service for share ledger administration.
Step 1 – Previous Documentation
If you already have a share ledger in Excel containing all historical information, you’re off to a good start. But if the history is missing, you will need to search for the data. A key question: Can you see the date when the company was founded in Shareholding #1?
Examples of documentation that may be necessary to retrieve and copy in order to carry out a full reconstruction of a share ledger include:
Certificate of incorporation
Share subscription lists
General meeting minutes
Voting lists
Company registration certificates
Dated shareholder registers
Board meeting minutes
Correspondence with shareholders
Share transfer agreements
Copies of cancelled and outstanding share certificates
Any other written documentation that may contain information about changes in share capital over time
The size and numbering of shareholdings, and who has owned them over time
In some cases, conversations with former board members and previous shareholders may also be necessary to obtain information not otherwise available. In short, use every possible resource to collect all the information the Swedish Companies Act requires the share ledger to contain.
Step 2 – Organize Documentation
To help you keep track of all the documents you’ve copied, it may be necessary to create a working binder. Start by inserting a paper index with numbered tabs. Make sure you have at least as many tabs as the number of years the company has existed. Then organize the copied documentation in chronological order. This way, it will be easier for you to sequentially find events relevant to reconstructing your company’s share ledger.
Step 3 – Timeline and Key Events
Another helpful tool to give you a visual overview of your company’s history is to create a continuous timeline from the company's founding to the present day. For example, you can mark 3 intermediate points – i.e., 4 quarters – for each year. If many years need to be reconstructed, one midpoint (i.e., two halves per year) may suffice.
Using your working binder, start marking each time the company held a general meeting, placing the event above the timeline. Then clearly mark when the company either conducted a corporate action (e.g., new share issue, non-cash issue, bonus issue, etc.) or authorized the board to carry out such actions before the next ordinary general meeting. In the latter case, you may need to look for share subscription lists among board meeting minutes created during that period.
When you reach today’s date, you’ll have a good overview of when changes to share capital occurred. Even more valuable is that each general meeting requires a voting list, which shows the names and holdings of attending shareholders. Legally, only shareholders listed in the share ledger may participate, so this acts as a confirmation of what the share ledger should have looked like at those times. Any discrepancies between voting lists at different meetings can indicate share transfers.
If differences are found (assuming you have names covering 100% of ownership), you can conclude that a transaction took place between those meetings. You can then search the remaining documentation from that period to confirm. On the other hand, if the voting lists look identical, you may conclude that no transactions occurred in that time span.
Examples of other documents that may be created and saved at each general meeting include address lists for invitations, attendance lists, shareholder lists, and proxies.
Step 4 – Identify the Initial Shareholders
The founding general meeting should include the certificate of incorporation, the share subscription list, and the first voting list, which provides information about the founders (individuals or legal entities) and their contact information. The decision to create a share ledger – i.e., the date when the founder(s) were first entered into the ledger – is usually found in the minutes of the first board meeting following the founding meeting.
These documents (founding meeting, certificate of incorporation, share subscription list, voting list, and the first board meeting minutes) also provide information on share capital, total number of shares, share classes, and their distribution among founders.
With this information, you can proceed to Step 1 of the entry process (e.g., answer: What was the company’s share capital at founding?) and Step 2 (e.g., answer: What share classes and how many shares were there at founding?).
Option 1
If the company was founded by one person, the entire share capital was represented by a single shareholding.
Option 2
If the company was founded by more than one person, the share ledger began with as many shareholdings as there were founders. However, if there is no documentation indicating which shareholding numbers the founders initially held, you’ll need to work forward through your binder to find at least one shareholder with numbered shares. Then, you work backward using known transactions or corporate actions to determine which numbers originally belonged to which founder.
If no numbering information exists at all, that actually simplifies things – NVR’s system will manage numbering from that point on, creating a new reference.
Once you’ve completed Step 4, you can finalize the registration process and establish the share ledger in NVR’s system. All future changes will be saved automatically in the system. Please note that it is important to record these changes in chronological order.
Step 5 – Investigate Transactions
Using the material in your binder, check if any share transfers occurred in the period before the next corporate action (e.g., change in share capital or number of issued shares). If so, carry out the transactions using NVR’s share ledger administration system. Be precise about which share numbers are transferred, especially if a buyer does not acquire all of the seller’s shares. It’s advisable to track the share numbers forward in time to ensure that the correct ones are transferred.
Step 6 – Execute Corporate Actions
When you reach a point where a corporate action has taken place, complete it using NVR’s system. Then move on to Step 7. Note: Multiple corporate actions may be decided at one meeting (e.g., several share issues, or a combination of bonus issue and split). Be sure to carry these out in the correct order.
Step 7 – Review and Inform
Once you’ve reached the present date and there are no further transactions or corporate actions to perform, you are done. Your company’s share ledger has been reconstructed!
If there are still more transactions or events, repeat Steps 5 and 6 until up to date.
If everything has been done correctly, the share ledger should match all shareholders' understanding of their ownership – with the added benefit that you can now inform them precisely which share numbers they own and who has owned them previously.