Share transfer documents: How to do it

Share transfer records are an important part in the process of transferring ownership of shares to shareholders in the company. Preparing stock transfer documents in accordance with regulations not only ensures legality but also helps related parties avoid legal risks in transactions. Through the following article, Long Phan will analyze in detail the process of implementing share transfer procedures in accordance with the law.

In what cases are shares transferred?

• According to Point d, Clause 1, Article 111 of the Law on Enterprises 2020, shareholders have the right to freely transfer their shares to others, unless otherwise prescribed by law.
• In addition, Clause 1, Article 127 of the Law on Enterprises 2020 also affirms this principle of freedom of transfer, and also regulates transfer restriction cases according to Clause 3, Article 120 of the Law on Enterprises 2020.

Shares are not transferable

Law on Enterprises clearly stipulates the types of shares that are restricted or prohibited from transfer to protect the interests of the company and its stakeholders. Mastering these regulations helps avoid legal risks and ensures the validity of transfer transactions.

Types of shares restricted from transfer:

1. Voting preference shares.

According to the provisions of Clause 3, Article 116 of the Law on Enterprises 2020, voting preference shares:

• Not transferable to others;
• Transferable only according to legally effective court judgments or decisions;
• Transferable in case of inheritance;
• The transfer must ensure principles of fairness and transparency.

2. Shares of founding shareholders:

According to the provisions of Clause 3, Article 120 of the Law on Enterprises 2020, shares of founding shareholders are regulated as follows:

• Restricted for 3 years from the date the company is granted a Business Registration Certificate;
• Common shares of founding shareholders are freely transferable to other founding shareholders;
• Can only be transferred to people who are not founding shareholders if approved by the General Meeting of Shareholders;
• Shareholders planning to transfer do not have the right to vote on the transfer of their shares;
• After a period of 3 years, restrictions on common shares of founding shareholders are abolished.

Share transfer records

Preparing share transfer documents is an important step that requires carefulness and completeness. Records must ensure legality and meet the requirements of state management agencies.

Share transfer documents include:

• Decision of the General Meeting of Shareholders on the transfer of shares (if necessary);
• Minutes of the meeting of the General Meeting of Shareholders (if any);
• List of founding shareholders of joint stock companies;
• Company charter (including amendments and supplements, if any);
• Share transfer contract;
• Minutes of liquidation of share transfer contract (if any);
• Share certificates of the company’s shareholders;
• Register of shareholders;
• Other legal documents (if any).

Procedures for transferring shares

The process of transferring shares requires strict compliance with the steps prescribed by law and the company charter. Each step in the process needs to be performed carefully and completely to ensure the legality of the transaction.

Step 1: Organize the General Meeting of Shareholders

• Before transferring shares, the company needs to hold a General Meeting of Shareholders to approve the decision to transfer shares.
• This is to ensure consensus from shareholders and compliance with the provisions of the company’s Charter.

Step 2: Sign the share transfer contract

• After approval from the General Meeting of Shareholders, the participating parties (transferring shareholder and transferee) proceed to sign the share transfer contract.
• The contract needs to be clear about the terms, including the value of shares, payment method and related benefits.

Step 3: Pay the share transfer price

• The parties make payment for the share transfer price as agreed in the contract.
• This is an important step to complete the transaction and transfer ownership of shares from the transferring shareholder to the transferee shareholder.

Step 4: Update information in the Shareholder Register

• After completing payment and other procedures, the company needs to update the new shareholder’s information in the Shareholder Register.
• This helps the company maintain an accurate and complete list of shareholders, and record changes in ownership of shares in the company.

Consulting on share transfer at Long Phan

At Long Phan, we provide comprehensive and professional share transfer service solutions for all customer needs. Our consulting services include:

• Consulting on detailed regulations on procedures and conditions for transferring shares.
• Detailed advice on the process of transferring shares in the company.
• Consulting on the rights and obligations of the parties (transfer shareholder, transferee, company) throughout the transfer process.
• Assist customers in preparing necessary documents.
• Consulting and supporting the drafting of share transfer contracts, ensuring the contract complies with regulations.
• Support in carrying out procedures for registering changes in shareholders in company records at the business registration agency.
• Support in resolving disputes arising during the share transfer process.

Transfer of shares is a complex procedure, requiring a deep understanding of corporate law and a strict implementation process. Long Phan, with a team of experienced and highly specialized consultants, is committed to providing optimal solutions and comprehensive support to you throughout the process of implementing share transfer procedures. Please contact us immediately via hotline 0906735386 for free consultation and the most professional support.