See section 49(7)
| (1) | A company that has been instructed to convert certificated securities into uncertificated securities— |
| (a) | must ensure that the documents and instruction lodged with it comply with the rules of the central securities depository; |
| (b) | must ensure that the documents of title and other information relating to the certificated securities correspond to the particulars contained in the securities register; |
| (i) | the distinguishing number recorded in terms of section 50 (5) is valid; |
| (ii) | the distinguishing number represents the document of title evidencing the entitlement of the person who has given the instruction to convert; |
| (iii) | a document of title relating to the certificated securities is valid and has not been cancelled or recorded by the company as lost or stolen; and |
| (iv) | the number of certificated securities to which a document of title relates does not exceed the holding allocated to the holder of the securities concerned in the securities register; |
| (d) | must verify that the document of title relating to the certificated securities has, on the face of it, been validly issued by the company; and |
| (e) | may not act on an instruction to convert if it has reason to doubt the validity of the instruction or the document of title relating to the certificated securities. |
| (2) | After a company has accepted an instruction to convert certificated securities into uncertificated securities, it must— |
| (a) | record in the securities register the date on which the securities are converted; |
| (b) | indicate clearly on the face of the document of title relating to the securities that the securities have been converted; |
| (c) | reflect the converted securities as uncertificated securities in its securities register. |
| (3) | After certificated securities have been converted in terms of sub-regulation (2), the company must instruct— |
| (a) | the participant appointed by the holder of the securities; or |
| (b) | in the absence of such a participant— |
| (i) | a participant appointed by the company which has agreed with the company to hold the securities on behalf of the securities holder; or |
| (ii) | the central securities depository, |
to enter the number of uncertificated securities and the name of the holder of the securities, as it appeared in the company's securities register before the conversion took place, in an uncertificated securities register in accordance with the rules of the central securities depository.
| (4) | Except in accordance with section 54, or a court order, a company may not— |
| (a) | require a participant or central securities depository to remove or change the particulars of uncertificated securities from or in an uncertificated securities register; or |
| (b) | reduce the balance of uncertificated securities recorded in its securities register. |
| (a) | is taken by a person authorised to take that action, and carried out in accordance with the Act, regulation 33, and this regulation; and |
| (b) | results in a consequence listed in section 55 (1)(a) to (c), |
is not "an unlawful action" as contemplated in section 55 (1).
