Company Law: Shares and Shareholders in 3 Minutes

Let's talk about pizzas and pizza-eaters, and how shareholders really just hold shares in the company pizza.
The second of three introductory company law videos!
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To check out all my videos, comics, and blog posts explaining law in simple terms, check out my website at whatislaweven.com ^^
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Contract Law: • Contract Law in 2 Minutes
Tort Law: • Tort Law in 3 Minutes
Land Law: • Land Law in 3 Minutes
Company Law (1/3): • Company Law: What Comp...
Company Law (2/3): [you are here!]
Company Law (3/3): • Company Law: Directors...
Trust Law: • Trust Law in 4 Minutes
Criminal Law: • Criminal Law in 4 Minutes
Constitutional Law: • Constitutional Law in ...

[@Bachjuis7]

This is wrong. Shareholders do not own business corporations, they own shares. These shares are given by corporations to legally structure the corporation and they do not own the corporations business! Do you as shareholder own the assets of the corporations? No; you solely own a simple share "used to legally structure the corporation". (Source: Jean-Philippe Robé, The Legal Structure of the Firm)

[@WhatIsLawEven]

I think you're correct, and I'm going to pin your comment! Practically, you probably don't need to know the real legal characteristics of shares. But for those of us involved in legal nitty-gritties, I think it's quite important to know this.
The idea of shares as 'ownership of the company' is mostly a historical artefact. Modern companies had their roots in partnerships, mainly from the UK and France; in those traditional partnerships, you do truly own a 'share' of the partnership's assets (though, note that modern LLPs change this). When modern limited liability companies were created by statute around 1800 or so, they were mere extensions of the partnership concept. But once further legal developments came, particularly after the Salomon v Salomon case, it became much harder to equate ownership of shares with ownership of a company.
So legally speaking, as you point out, shares are just shares. In my view, this is the legally correct position. Owning a share is like owning any other personal property right, except that the companies statutes shape the contours of that right. The more important rights are to appoint directors and vote in the general meeting (next video!).
Which is why, for those in this field, please keep in mind that I've cut some corners in this series of company law videos. I went for the language of shares as 'sharing in the control over the company', because of the legal relationship between property rights and 'control' rights. While the idea of shares as ownership in the company is much more intuitive than our discussion above, and I think it suffices for non-legal purposes, I don't think it's legally correct.
So thank you for your comment! I'm glad this video has reached some audiences in the legal field, and I'm glad that these technical distinctions have been flagged.

[@braveheartkungfujudokarate9830]

I have a problem, my name/identity is being used as director and share holders without my self knowing..The LHDN once call me talking about taxes, and I thought it was just scammer.. so, I just ignored it. All of my Bantuan kerajaan is rejected, becoz my name as a director in a sdn bhd company. I go to SSM to verify it, the company that used my name/identity just took out my name as a director but I'm still a share holders. When I look at my share, I have about 1200000.. million.. I know nothing about this shareholder function.. do u have solution? Can I take this scammer money as a share holders? Becos It cost me my own money just to clear my own name.. is there any way that I can take out this share holders money? Sory for my bad English....

[@luqmanazizi7031]

@@braveheartkungfujudokarate9830 have you report this case to authorities first and say that youre not doing any of this

[@braveheartkungfujudokarate9830]

@@luqmanazizi7031 already did. I think SSM still investigating this matter. I don't know how soon..

[@SmokedAlien]

@@braveheartkungfujudokarate9830 LMAO technically you should be able to redeem/cash-out/sell those shares and get all the money =)) Ofc you also have to pay taxes if you sell them or if they generate passive income but this is another story =)))

[@thetongueofangels1882]

this actually made it 1000% easier for me to understand. Thank Youuuuu

[@kolaveri2129]

Grand father share rights to grandson

[@jamalafzalkhan3181]

Simply the best u have described, jazakALLAH ❤️

[@mariafigue9085]

Good one and easy, thanks!

[@jenniferasieduaobirih-opar5976]

Thank you 😄

[@tsimamandla9708]

Thank you

[@francescagiupponi5526]

Which app do you use?? thanks!!!

[@Michael___0k9a]

Here come the details and expected actions for your refund

[@ImperialEarthEmpire]

im a shareholder of a famous company! now bow to me peasant... what? how much shares? *mumble* 100 shares *mumble* now bow!

[@The_Schizoid_Man]

I get how a pizza is divisible, but how is a company divisible?

[@devstruction98]

Hi I’m looking to be a shareholder/stakeholder in my friend’s company that has just been registered in Singapore. Because he needs funding to scale his business and I’m acting as the investor but I’m not sure how to negotiate the percentage of the company I control, please advice

[@devbyjesus4176]

i think it is based on the impact of your investment at the moment . I recommend you to look at the story of eduardo saverin in the case of facebook

[@divyallen]

From what I've learnt, it all depends on the company structure and the kind of shares you're buying. If your friend decides to sell voting shares to you, you have a say in the company's decision-making, or you have a part in its control. If you buy non-voting shares, you can't make decisions, and so you don't own the company. You just have an ownership that authorizes you to dividends

[@Angela-po7cr]

What about Violent land theft neighbor Morton LLC growing doing bribes ath threats etc what do I do..my neighbor Zack Morton 55361 has got help from police