Bearer Shares in Grenada and Current Custody Rules

Bearer Shares in Grenada: Where the Law Stands TodayCopy link to section

Bearer shares in Grenada are prohibited. New issuance is not permitted under the law governing international companies, and beneficial ownership of every share must be recorded by a licensed registered agent rather than vesting silently in whoever holds a paper certificate. This rule reflects commitments made under the FATF beneficial ownership standard and the OECD Global Forum exchange-of-information framework.

The position matters most to non-resident investors and their advisers weighing a Grenadian international company, and to anyone who already controls an older offshore entity that may have once issued bearer instruments. The pages below explain how the prohibition came about, what happened to legacy certificates, and the steps an owner outside the country should take to stay compliant.

What Bearer Shares Are and Why They MatteredCopy link to section

A bearer share is an equity instrument whose ownership follows physical possession of the certificate. There is no register entry to consult; whoever holds the paper is treated as the owner, and transfer happens by simply handing the document to another person.

That feature once made bearer shares attractive for offshore structuring, because ownership could change hands quickly and without any public or registry filing. The same anonymity turned them into a recognised conduit for money laundering and tax evasion.

International standard-setters responded by closing the gap. FATF Recommendation 24, updated in March 2022, and the OECD Global Forum's Exchange of Information on Request standard both require jurisdictions either to prohibit bearer instruments or to neutralise their anonymity through registration and custody measures. Under those standards, countries must stop the issuance of new bearer shares and bearer share warrants and apply controls to prevent misuse of any that remain.

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The Legal Foundation: International Companies Act and Related ReformsCopy link to section

Grenadian international companies are governed by the International Companies Act, Cap 152, as amended. That statute sets the framework for how shares are issued, recorded, and transferred, and it requires registered agents to hold the names and addresses of company directors and the beneficial owners of all shares.

The decisive reform came through the International Financial Services (Miscellaneous Amendments) Act 2002. It compelled offshore financial institutions to recall and cancel any bearer shares already issued and to replace them with registered shares.

Bearer shares are not permitted under the law as it stands, a status confirmed in U.S. State Department compliance reporting on the country's AML/CFT regime. Domestic businesses fall under a separate statute, the Companies Act, Cap 58A of the 2010 Revised Laws.

How Grenada Moved Away from Anonymous Bearer InstrumentsCopy link to section

The 2002 reform ran on two tracks. Financial institutions, including banks, insurers, and other licensed offshore entities, had to recall and cancel every issued bearer share immediately and reissue registered shares in their place.

Non-financial offshore companies were treated differently. Their bearer shares were not annulled outright but subjected to mandatory custodial immobilisation, with holders required to lodge the certificates with a licensed registered agent.

Agents were placed under a duty to verify the identity of every share's beneficial owner and to keep that information for seven years. The Grenada International Financial Services Authority (GIFSA) gained the right to access those records and to share them with regulatory, supervisory, and administrative bodies. Further AML measures followed during 2012, among them the Financial Intelligence Unit Act and a revised Proceeds of Crime Bill, consolidating the shift away from anonymous holding.

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Immobilisation and Custody Requirements Under Current RulesCopy link to section

For any residual pre-2002 certificate that never reached a financial institution, the immobilisation mechanism is physical lodgement with a licensed registered agent. Custody by an unlicensed party is not allowed; the custodian must be an entity licensed under Grenadian law.

The agent must confirm who the beneficial owner is and retain that identity record for seven years. GIFSA can reach into those files and pass the information to other agencies, which means immobilised shares carry no practical anonymity.

A detailed fee schedule, processing-time rule, or specific procedural section number for immobilisation was not available in published sources. Holders needing those particulars should work from the consolidated Cap 152 text and their registered agent's guidance.

The Transition Path for Legacy Bearer SharesCopy link to section

The transition framework dates to 2002 rather than to any later measure. Financial-institution certificates were recalled and cancelled outright; non-financial certificates were immobilised with licensed agents instead of being voided.

No dated post-2002 sunset deadline appears in the available Grenada-specific record, unlike the fixed cut-off dates seen in some European regimes. The reasonable reading is that immobilisation has stood as the continuing rule since 2002, with no further phased deadline publicly documented.

A holder still in possession of an older certificate must lodge it with a licensed agent, who verifies beneficial ownership and keeps the record for seven years. Failure to lodge leaves the holder out of step with AML/CFT obligations and exposed through the agent's KYC duties; the precise sanctions for non-lodgement were not retrievable and should be checked against the consolidated Act.

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What This Means for Non-Resident Owners and AdvisersCopy link to section

No new bearer shares can be issued by a Grenadian international company. Every fresh issuance must be in registered form, with names recorded by the registered agent, so anonymity is not available even through nominee arrangements once the agent holds the underlying detail.

For an adviser building a structure from outside the country, two practical points follow. The appointed registered agent must be GIFSA-licensed, and all beneficial owner details have to be supplied at incorporation or at the moment of any share transfer.

Transfers themselves must be processed as registered transfers through that agent. Physically moving a certificate is not a valid transfer; any change in beneficial ownership has to be reported to, and recorded by, the agent. Both local and international companies are also bound by general corporate governance, financial reporting, and transparency duties under the applicable companies legislation.

Bearer Shares, Beneficial Ownership and Transparency ExpectationsCopy link to section

The March 2022 revision to FATF Recommendation 24 raised the bar on beneficial ownership worldwide, requiring competent authorities to obtain adequate, accurate, and up-to-date information on the true owners of companies. The stated aim is to stop criminal networks, corrupt actors, and sanctions evaders from hiding behind anonymous shells.

Grenada keeps beneficial ownership data at the private-sector level, inside the licensed registered agent, rather than in a publicly searchable central register. Whether that custodial model fully satisfies the revised, multi-pronged R.24 expectation, or whether a state-level register will be needed, remains a live question in Global Forum and FATF peer-review cycles.

The OECD Global Forum EOIR standard requires that, where bearer shares are allowed at all, mechanisms must exist to identify the holder. By prohibiting new issuance entirely, the country sits beyond that minimum. Its specific Global Forum rating was not available in the sources reviewed and should be checked on the OECD portal directly.

Practical Steps for Holders of Older Grenada CompaniesCopy link to section

If you control an entity formed before the 2002 reform, work through the following with the registered agent.

1. Confirm whether any bearer certificate was ever issued, and if so, that it has been physically lodged with the agent and that the agent's records show the beneficial owner.
2. Check that current, verified KYC documentation is on file; the seven-year retention rule means older records may need refreshing, especially if the agent has changed.
3. Where pre-2002 bearer shares went to a financial institution, verify they were recalled and reissued in registered form as the 2002 amendments required.
4. Execute any share transfer as a registered transfer through the licensed agent; delivery of a paper certificate has no legal effect.
5. Treat all beneficial ownership data lodged with the agent as accessible to GIFSA and, through information-sharing, to foreign authorities.
6. Verify the agent is in good standing; if the original has been de-licensed or wound down, appoint a replacement and move the records before any transaction.

Outlook for Share Ownership Structures in GrenadaCopy link to section

The trajectory points toward greater transparency. New bearer shares are already barred, registered agents hold the ownership data, and GIFSA retains access rights to those files.

Legislative modernisation is set to continue. In the 2023 budget statement, Prime Minister and Finance Minister Dickon Mitchell announced plans to reform the companies legislation, signalling further change ahead.

Revised FATF Recommendations 24 (2022) and 25 (2023) mean jurisdictions that rely on registered-agent custody rather than a state-run register will face sustained scrutiny in upcoming mutual evaluations. Those reviews are becoming more risk-based and effectiveness-focused, so a prohibition on paper alone will not satisfy assessors; demonstrated enforcement will count.

Non-resident owners planning new entities should expect registered ownership with full KYC to remain the baseline, with the possibility of central-register filing emerging later. No published proposal for a public beneficial ownership register was found in available sources, so monitoring laws.gov.gd and GIFSA announcements is the sensible course.

ConclusionCopy link to section

Anonymous paper ownership has no place in a Grenadian international company; new bearer shares cannot be issued, and any legacy certificate must sit immobilised with a licensed registered agent who holds verified beneficial ownership data. For a foreign owner, this means structuring around registered shares, accurate KYC, and a properly licensed agent from the outset. Holders of older entities should confirm that any historic bearer instruments were dealt with and that records remain current. The compliance baseline is settled, and the direction of reform favours still more transparency.

How Expanship Can Help Your Business in GrenadaCopy link to section

Expanship advises non-resident owners on the share-ownership rules that govern Grenadian international companies, including the prohibition on bearer instruments, registered transfers, and the beneficial ownership records a licensed agent must hold. The same team supports the broader needs of a foreign-owned entity, from formation through continuing compliance.

• Company incorporation and structuring under the International Companies Act
• Licensed registered agent and registered office services
• Tax registration and filing
• Ongoing compliance and beneficial ownership record management
• Accounting and bookkeeping
• Introductions to banking partners

To discuss structuring or compliance for your entity, contact Expanship Grenada.

Frequently Asked QuestionsCopy link to section