Share certificates are documents issued by companies to certify ownership of a certain number of shares. This allows investors to take ownership of stock and is generally replaced by digital records in modern times. Share certificates are evidence of the financial position of the company's stock and provide legal ownership rights of the shares held.

Share certificates are legally binding documents, however they are only as secure as their physical form. If lost or stolen they could easily fall into the wrong hands and be transferred without the owner’s knowledge. As a result companies often have a “stop transfer” policy in place that can be used if a certificate has been compromised. If a share certificate is damaged, lost or stolen it can be reissued with a replacement certificate for the same number of shares.

On the other hand, Electronic Share Certificates are electronic documents that represent the same ownership rights as paper share certificates. It allows for the same rights yet does away with costly document re-issuing. Electronic Share Certificates also eliminate issues such as sending original certificates through the mail system and other associated risks.

Transferring of shares whether with a paper certificate or electronically has the same tax implications. Failing to report the transfer of shares is a serious offence and implies that the shareholder is attempting to evade tax. Such actions could result in a significant financial penalty to the shareholder.

In conclusion, whilst paper Share Certificates are not commonly used anymore, they are still a legal and effective way to certify ownership of stock. Electronic Share Certificates also provide a secure and efficient way of doing so and carry the same legal implications as paper certificates. It is important to note, however, that on either platform the same tax implications are applicable and all transfers must be reported for legal and moral reasons.