Digital Share Transfers: How Timestamps Become a Risk for Ownership Transfer – and How to Defuse It

Introduction

The way an assignment of shares is signed has a direct impact on the moment ownership is transferred from the seller to the buyer. As long as assignment documents were prepared on paper and could be backdated, the economically intended chronology of a share transfer was usually easy to reflect. With the introduction of qualified electronic signatures (QES), this reality has changed fundamentally.

The electronic timestamp records the exact moment of signing and cannot be altered. This single element can lead to situations where legal and economic ownership diverge, voting rights are attributed incorrectly, or dividends are paid to someone who is not the legal owner of the shares at the relevant date. In some cases, this can result in challenges to general meeting resolutions or even claims for damages.

Digital assignments therefore bring not only efficiency but also new pitfalls. Anyone who does not understand the risks of timestamps or fails to organise the sequence of signatures properly risks disrupting the entire ownership chain. This article presents the key legal principles, the most common pitfalls and the essential steps to ensure that digital assignments are carried out correctly and securely.

Table of Contents

• Legal foundation: When does ownership transfer?
• Share register entry vs. ownership transfer
• Determining the moment of ownership transfer
• Risks of late or incorrectly sequenced signatures
• Practical example
• Recommendations
• Conclusion

Legal foundation: When does ownership transfer?

Under Swiss law, the transfer of ownership of registered shares issued as uncertificated securities requires a valid written assignment. Written form ordinarily means a paper document bearing a handwritten signature. However, a qualified electronic signature with a certified timestamp is legally equivalent. A PDF signed with a QES therefore fully satisfies the requirements of written form.

Ownership passes to the acquirer on the date of the handwritten signature or, in the case of QES, on the date indicated by the automatic timestamp.

Share register entry vs. ownership transfer

The entry of a person in the share register and the actual transfer of ownership are often perceived as a single process, but legally they are distinct. The person entered in the register is considered the shareholder vis-à-vis the company and may exercise the associated rights, including voting at the general meeting and receiving dividends.

Civil ownership does not arise from the share register entry but exclusively from a valid written assignment. Only once the assignment has been validly signed — in a digital environment through a QES signature — does ownership legally pass. The entry in the share register merely documents this transfer; it can neither replace it nor anticipate it.

Determining the moment of ownership transfer

The moment of transfer depends on the moment the assignment is validly signed. Historically, assignments could be drafted afterwards on paper and backdated without difficulty. The actual date of signature was of limited importance.

With QES, this practice changes significantly. The electronic signature creates an immutable timestamp that reflects the exact moment the assignment becomes legally effective. That moment triggers the civil transfer of ownership. If the signature occurs late or in the wrong sequence within a chain of transfers, the legal ownership situation shifts accordingly.

As a result, the entry in the share register may temporarily diverge from the actual ownership situation. Someone may exercise voting rights or receive dividends even though they are not yet the civil owner. Conversely, an economically intended acquirer may only become the legal owner days or weeks later.

To keep the share register entry and the legal ownership status aligned, digital assignments must be timed carefully and signed in the correct order.

Risks of late or incorrectly sequenced signatures

Digital signatures create several risks in digital assignments:

• A breakdown of the chronological sequence if signatures do not match the order of transfers.
• Divergence between economically intended and legally effective ownership.
• Voting rights legally belong to the person who appears as beneficiary in the most recent validly signed assignment before the general meeting.
• General meeting resolutions may be challenged.
• Dividend entitlements may become disputed.

Practical example: When digital timestamps overtake economic logic

Transfer chain – Participants and sequence:

• Shareholder A sells their shares back to X AG on 15 May.
• X AG sells them to shareholder B on 16 May.
• The general meeting takes place on 17 June, and B is expected to participate.
• The dividend is distributed on 18 August, and B is intended to be entitled.

Paper assignments:
Assignments are prepared in August, backdated to 15 and 16 May, and signed. All parties agree — no issue arises.

Digital assignments with QES timestamp:

Variant 1 – All sign on 30 August
→ Ownership transfers only on 30 August.
→ A remains the legal owner on the dates of the general meeting and dividend distribution.

Variant 2 – Signatures on different days

• The company signs on 30 August
• A signs on 5 September
  → The company would be selling shares it does not yet legally own.
  → The ownership chain collapses.

Recommendations

The assignment document should clearly specify the economic transfer date agreed upon by the parties. This replaces the handwritten date once used and clarifies the intended distribution of economic rights, even though the electronic signature timestamp remains decisive for the legal transfer.

Conclusion

Digital assignments increase efficiency but also require a new level of clarity regarding the exact moment ownership transfers. The QES timestamp determines the civil transfer. If assignments are not signed in the right order or are executed too late, ownership, voting rights and dividend entitlements can diverge quickly. To avoid such issues, the assignment should explicitly state the intended transfer date, ensuring consistent documentation even when signatures occur later.

Konsento’s digital share register supports companies throughout this process. When recording a transaction, the platform indicates when an assignment is required and automatically provides the appropriate templates. Users can define the intended transfer date, and assignments can be signed electronically via QES if desired.

With clear workflows and built-in automation, Konsento ensures that share transfers and register management remain digital, consistent and legally sound. Additionally, an AI-powered chatbot is available around the clock to assist with support questions or corporate-law issues.

Register here for Konsento’s digital share register — free of charge for up to 150 shareholders.