Regulations on Share Transfer

Legal Basis:

  • Law No. 59/2020/QH14 on Enterprises, effective from January 1, 2021
  • Decree No. 01/2021 on Business Registration, effective from January 1, 2021
  • Circular No. 92/2015/TT-BTC, effective from July 30, 2015

Share Transfer Overview:

Share transfer refers to the process where a shareholder in a joint-stock company transfers their shares to another shareholder. The regulations for share transfer are as follows:

  • Types of Shares Transferable:

    • Ordinary shares
    • Dividend-preferred shares
    • Redeemable preferred shares

  • Non-Transferable Shares:

    • Voting-preferred shares cannot be transferred

  • Founding Shareholders:

    • Within 3 years from the date the company is granted a business registration certificate, founding shareholders can:
      • Freely transfer ordinary shares to other founding shareholders
      • Transfer shares to non-founding shareholders only with the approval of the General Meeting of Shareholders

  • Regular Shareholders (Non-Founding):

    • Have the right to freely transfer their shares to others

  • Transfer Method:

    • Shares can be transferred through a contract or transactions on the stock market

Procedures for Transferring Shares in Joint-Stock Companies:

  1. Notification of Changes:

    • Notification to the Business Registration Office is only required if the founding shareholder has not paid or has only partially paid for the shares registered within 90 days from the issuance of the business registration certificate.

  2. Internal Share Transfer Process:

    • Companies do not need to register changes in shareholder information for internal share transfers. Transfer documents are kept on file within the company.

  3. Foreign Investor Transfers:

    • If the share transfer involves a foreign investor, the company must notify the Business Registration Office as stipulated in Article 58 of Decree No. 01/2021/ND-CP.

  4. Share Transfer Process:

    • Hold a General Meeting of Shareholders to decide on the share transfer
    • Execute and sign the share transfer agreement
    • Prepare and sign the minutes and liquidation of the transfer contract
    • Update and amend shareholder information in the company’s Shareholder Register

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