Not maintaining a share registry has both legal and practical implications. Under the Companies Act, a company commits an offence if it fails to maintain a share register as required, and it could face a fine of up to $10,000.
Each director must take reasonable steps to ensure that the register is properly kept and that share transfers are recorded promptly. It is an offence for a director to fail to comply with these duties, and also punishable by a fine of up to $10,000.
The practical implication of not maintaining a share register is not accurately recording your companies ownership over several years. Companies need to take steps to make sure that any changes in ownership, investor details, and other corporate actions are recorded in a secure location and with accurate information. The problems of inaccurate information storage only become more significant over time.