A corporate registrar can be a government entity that authorizes commercial formations and regulates authorized entities or a financial institution hired by companies to keep a record of ownership of their outstanding stock and securities. In both cases, the corporate registrar functions primarily as an information archivist to keep track of the current list of records.
The role of a corporate registrar depends on the context in which the title is used. There are two common applications of the title. A corporate registrar is the government entity that authorizes commercial formations and regulates authorized entities until they are officially dissolved. Corporate registrars can also be financial institutions hired by companies to keep a record of ownership of their outstanding stock and securities for record keeping purposes and to prevent the company from issuing more shares than have been authorized. In both cases, the corporate registrar functions primarily as an information archivist to keep track of the current list of records.
In countries with private commercial sectors such as the US, UK and Canada, the corporate registrar is the government agency that licenses companies to operate. It is where companies file their bylaws for official company launch and other types of entities file their formation documents. These agencies are registrars because they maintain the public record of authorized business entities within a jurisdiction. Typically, a member of the public can contact the registrar’s office to determine a company’s business registration status.
Government registrars also manage companies’ annual filing obligations and provide administrative services, such as changing a company’s registration processing, providing copies of documents, and certifying a company’s status. The corporate registrar, in this context, also manages the dissolution of companies and holds a company’s authority to do business in the jurisdiction as of registration when it closes its doors. In the US, for example, each state has a corporate registrar, who is usually the secretary of state. Workers in the secretariat’s business division perform a number of administrative tasks that maintain the public record of registered business entities.
The other common use of the title of corporate registrar is the appointment of a financial institution to maintain the record of a corporation’s outstanding securities. Technically, a corporation can appoint anyone to keep this record. In many small companies, for example, the secretary of the board may be given this task and title. However, for large companies with millions of shares outstanding, the only practical approach is to have an expert maintain the ownership record.
Financial institutions that function as corporate registrars keep track of the names and addresses of current owners of stocks and bonds. Whenever a security changes hands, the change is captured and logged. These institutions work hand in hand with brokers and traders to gather this information for the record. While the record maintained by the corporate registrar does not determine ownership, it does allow the company to send important notices to owners as required by regulators. The financial institution also controls the total number of shares outstanding, so that the corporation does not issue more shares than authorized.
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