On the Conversion of Bearer Shares

Companies whose share capital does not consist of publicly traded or intermediated securities had until May 1, 2020, to convert their bearer shares into registered shares (Art. 622, para. 2ter CO). Those with listed or electronically held securities were required to have this conversion entered in the commercial register within 18 months, i.e., by May 1, 2021.

Failing that, the bearer shares have been converted de jure into registered shares, the entry in the commercial register includes a note of non-compliance, and amendments to the articles of incorporation are restricted. The articles of incorporation must be amended no later than the next time they are amended.

Disclosure of the Beneficial Owner

Holders who have not complied with the requirement to report the beneficial owner (Art. 697i aCO) will have their social rights suspended and their property rights extinguished. It is therefore essential to bring the situation into compliance without delay.

There are three steps required to have one's status as a shareholder recognized: filing a petition with the competent court, obtaining the company's consent, and providing proof of one's status as a shareholder. If approved, the shareholder regains that status with ex nunc effect, without retroactive effect.

Compensation for Loss Not Due to Fault

Once the statutory period has expired, the shares in question are permanently canceled and converted into treasury stock. Shareholders who can demonstrate that their shares were canceled through no fault of their own may assert a claim for compensation against the company within ten years of the cancellation.

The amount corresponds to the actual value of the share at the time of conversion, unless that value is lower at the time the claim is filed. It is the shareholder—not the beneficial owner—who is the claimant, and the actual value must be demonstrated at both relevant points in time.