Conversion is possible in either direction, but always for the entire issue and on the basis of a general meeting resolution amending the articles of association. Certificated shares may only be registered shares, and a simple joint-stock company cannot have them. On conversion to certificated shares, the central depository removes the shares from the accounts and cancels the issue. However, the depository continues to maintain the register of shareholders for certificated shares. Whether conversion is worthwhile depends mainly on how often the shares are transferred and whether they will need to be blocked by suspending the right to dispose of them.
A joint-stock company is not bound by the form of shares it chose on incorporation. Act No. 566/2001 Z. z. on Securities permits conversion of certificated shares into book-entry shares and vice versa, but always for the entire issue (Section 15, paragraphs 1 and 3). Conversion of certificated shares into book-entry shares is discussed in detail in the article on converting certificated shares into book-entry shares (forthcoming) (in Slovak). This answer addresses conversion in the opposite direction and when it is worthwhile.
When conversion to certificated shares is not possible
- Bearer shares may only be book-entry shares (Section 156(2) of the Commercial Code, Section 10(3) of the Securities Act). Before conversion to certificated shares, they must also be changed into registered shares.
- A simple joint-stock company may only have book-entry registered shares (Section 220i(1) of the Commercial Code).
Who decides and what is entered in the register
The issuer decides whether shares are certificated or book-entry (Section 10(2) of the Securities Act). In a joint-stock company, the decision to convert certificated shares into book-entry shares and vice versa falls within the powers of the general meeting (Section 187(1), letter f) of the Commercial Code). The articles of association must specify the form of the shares (Section 173(1), letter d)), so conversion requires an amendment to the articles of association, for which a two-thirds majority of the votes of shareholders present and a notarial deed recording the resolution are required (Section 187(2)). The issuer must publish the decision without delay in the Commercial Bulletin and in a nationwide daily newspaper that publishes stock exchange reports (Section 15(2) of the Securities Act).
The form of the shares is also entered in the Commercial Register (Section 12, letter f) of Act No. 29/2026 Z. z. on the Commercial Register). The application to register the change must be filed within 30 days of the date specified in the resolution or, if no date is specified, of its adoption or of the date on which the relevant legal event took effect (Section 112(1)).
Procedure at the depository
The issuer enters into a written agreement with the central depository (CDCP) for services relating to the conversion. Within 30 days of concluding the agreement, and no later than the date specified in it, the depository provides the issuer with an extract from the issuer register and a list of owners. Once these have been delivered, neither the depository nor its member may make any further entries concerning the shares (Section 17(1)). The depository then removes the shares from the accounts and cancels the registration of the issue (Section 17(2)).
The following quotation is reproduced in its original language:
Emitent je povinný postupovať tak, aby odo dňa, keď dostane výpis podľa odseku 1, do dňa vykonania výmazu cenného papiera z účtov vedených v centrálnom depozitári podľa odseku 2 neuplynulo viac ako 30 dní. Dňom vykonania výmazu cenného papiera z účtov vedených v centrálnom depozitári podľa odseku 2 vzniká majiteľovi tohto cenného papiera právo na to, aby mu ho emitent odovzdal v listinnej podobe […]
The share certificates must contain the particulars required by Section 155 of the Commercial Code. The issuer publishes the deadline by which shareholders must collect them (Section 17(3)); if a shareholder fails to collect them, the issuer follows the same procedure as for failure to present share certificates under the Commercial Code (Section 17(7)).
The following applies to encumbered shares:
- Any suspension of the right to dispose of the shares ends on the date the shares are removed from the accounts (Section 17(4)). The Act provides for such suspension only for book-entry securities (Section 28).
- A registered pledge remains in place, and the pledgee is entitled to delivery of the share certificate. The depository must notify the pledgee of the conversion in advance, and conversion may take place only after that notification (Section 17(5) and paragraph 6).
What changes after conversion
Without delay after issuing certificated registered shares, the company must enter into an agreement with the central depository for maintenance of the register of shareholders (Section 107(9)). The shares are then transferred by endorsement and delivery, and the transfer takes effect in relation to the company only upon entry in the register of shareholders, which the depository makes on the company’s instruction (Section 156, paragraphs 4 and 7 of the Commercial Code, Section 107(8) of the Securities Act). Shareholders no longer need an owner’s account with a bank or investment firm. However, the company continues to work with the depository on every change of shareholder. The reduction in administration is therefore smaller than it might appear.
Certificated shares may suit a closely held company with a few shareholders who rarely transfer their shares. If a new investor is expected, frequent transfers are anticipated, or shares will be used to secure a loan for which the lender wishes to block them by suspending the right to dispose of them, retaining book-entry shares is more suitable. The article on certificated or book-entry shares on incorporation can also help you choose the form of the shares.
We will prepare the general meeting resolution amending the articles of association and arrange conversion at the depository, including cancellation of the issue, as part of our registration of a book-entry share issue service. Following conversion to certificated shares, we will register and maintain the register of shareholders for certificated shares.
This answer provides general information on the law as at 3 October 2026. It does not constitute legal services or replace an assessment of an individual case. The details of your situation may differ. Book a consultation to discuss them.
