Company Law Reform Bill [HL]

I would be delighted to do so, although I am not certain that it would carry this debate forward to any great extent. The main issue here is that we are dealing with a very small historical situation, and in that rather limited situation it is probably sensible to continue with this arrangement, which would have to be done in any case. The difference between shares and stocks is that stock is said to have two advantages over shares. First, it is possible to deal in fractions of stock but it is not possible to deal in fractions of shares. However, this advantage is more theoretical than real. If the price of a share is regarded by the market as too high for dealings, the shares may be sub-divided into new shares with lower par values than those which they replace instead of converting the shares into stock. The second advantage is that stock does not have to be numbered. However, where all the issued shares of a class are fully paid, such shares do not require a distinguishing number. This relaxation of the rule was introduced in the Companies Act 1948. As it is uncommon for shares to be issued on a partly paid basis, that means that advantage can normally be taken of this exception without the need to resort to converting shares to stock. I think that that illustrates the point that this is not a big subject.