The respondents further claim that Milamus is not a "participant" for the purpose of filing a liquidation application, because it does not comply with the provisions of section 260 ofthe Companies Ordinance, which remains in force after the entry into force of the Companies Law, as stated in section 367(a) of the Companies Law. According to Section 260(a) of the Companies Ordinance, a "participant" may not submit a request for liquidation, unless "the shares by virtue of which he is a participant, in whole or in part, were allocated to him from the outset or were in his possession and registered in his name for at least six months out of the eighteen months preceding the commencement of the liquidation, or which were attributed to him due to the death of their previous owner." Since this condition was not fulfilled by the Milmus or the Registration Company, they are not a "participant" and are not entitled to file a liquidation request.
- Sections 22 and 23 of the company's articles of association state as follows:
"22. A deed of transfer of shares shall be signed by the transferor and the recipient of the transfer, and the transferor shall be deemed to have remained the shareholder until the name of the recipient of the transfer is registered in the register of members in relation to the transferred share. A deed of transfer of shares that has been paid in full can also be signed only by the transferor.
- The directors may, subject to these Regulations, at their sole discretion and without giving a reason, refuse to approve the registration of a share to a person whom they do not wish as a member of the company. If the directors use their authority under this regulation and refuse to register a transfer of shares, they must notify the recipient of the transfer of their refusal, within 60 days from the date the transfer deed was delivered to the company."
We said that the absence of a register of shareholders in the company cannot serve as a reason for not registering Milamus as a shareholder that it acquired from the foreign companies. The directors of the company on behalf of the respondent at the meeting of August 3, 1997, which began with a legal count and continued with a "missing count" of the directors, decided not to approve the registration of the transfer of the shares with the name of Milammus.