Share premium refers to the amount that members pay for a company’s shares over and above their nominal value. Therefore, when a company sells shares for more than the nominal value, it is issuing them at a premium.
Share premiums can be used as a means of raising capital for companies. By issuing shares at a premium, companies can raise additional funds that can be used to finance their operations, invest in new projects, or expand their business.
Update Share Register: Update the company’s share register to reflect the newly issued shares.
By a court application for reduction of share premium account.
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Share capital and share premium funds must be kept separate under different entries on a company’s balance sheet.
However, the issuance of share premiums in Cyprus is subject to certain legal and regulatory requirements. For example, companies are required to comply with the provisions of the Companies Law and the Capital Markets Law, as well as the rules and guidelines issued by the Cyprus Securities and Exchange Commission (CySEC).
One of the key requirements for the issuance of share premiums in Cyprus is that it must be justified by the nature and scope of the company’s operations. In other words, companies must be able to demonstrate that the premium is necessary and proportionate to the value of the shares being issued. This is to ensure that companies do not use share premiums as a means of artificially inflating the value of their shares or misleading investors.
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