![\"Transfer](\"https:\/\/glutenfreepleasure.com\/__proxy_domain\/www.3ecpa.com.sg\/wp-content\/uploads\/2017\/11\/photo-transfer-of-shares-in-singapore-400x300.jpg\" "\\"Transfer")
The shares of a company can be transferred or sold just like any other form of property. The could be many different reasons behind the transfer of share, be it the retirement or death of a shareholder, or recouping an investment, or gifting shares to family members, or raising additional capital, or bringing in a new business partner. A share transfer in Singapore involves some procedures and it could be is an easy process if you know how to do it.<\/p>\n
Let us have a look at what are the procedures involved and what kinds of documents needed in share transfer.<\/p>\n
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In the case where the transferor and transferees are either an individual or a corporation, or a combination of both, the documentation needed will be different.<\/p>\n
For individual shareholders [who may be based overseas], or is unable to sign on the required documentation due to certain reasons, the company has the option of preparing a Proxy Form, for the individual to appoint a proxy to sign on his or her behalf.<\/p>\n <\/p>\n As the name implies, the pre-emptive rights mean that the company\u2019s existing shareholders will have the first rights to any share that is being transferred. You can review your company\u2019s Memorandum and Articles of Association (\u201cM&AA\u201d) to check if your company\u2019s shareholders have pre-emptive rights (it is because it will typically have a clause to state if pre-emptive rights are applicable).<\/p>\n <\/p>\n It is a common practice to annex a copy of the said agreement to the DRIW if there is an agreement signed between the transferor and transferee (such as a Sale and Purchase Agreement, Loan Agreement or Joint Venture Agreement). Before signing, it is worth checking when is stamp duty payable<\/a> on business agreements in singapore to avoid late payment penalties.<\/p>\n In addition to this, the DRIW can authorise specific individuals [who may act on the company\u2019s behalf] to negotiate the said agreement or any other pertinent terms in relation to the transfer. Please note that this may not necessarily be the directors of the company and may be an employee of the company.<\/p>\n In instances that the company needs to engage a legal counsel or financial consultant to advise the company on the terms of the agreement, the appointment of the said professional should also be stated in the DRIW. On top of that, the company secretary<\/a> should also be authorised to make the relevant lodgement with ACRA and make the payment of the stamp duty with IRAS on the company\u2019s behalf.<\/p>\n <\/p>\n To be specific, The Instrument of Transfer is an official document that signifies the transferor\u2019s agreement to transfer and the transferee\u2019s agreement to accept the shares. That means if individuals are signing the Instrument of Transfer, a witness will usually be required to sign as well. In the case if the corporate entities are signing the Instrument of Transfer, corporate entities\u2019 Common Seal will be required to be affixed.<\/p>\n Please note that slight amendments to the Instrument of Transfer may be required if the transferor or transferee is a foreign entity.<\/p>\n <\/p>\n As the name implies, the Working Sheet is relating to the transfer of shares is a requirement by IRAS; and it will then be used in determining the stamp duty<\/a> that has to be paid (the stamp duty is calculated based on the purchase price or market value of the shares transferred, whichever is higher). The company will need either its latest audited accounts<\/a>, or the latest management accounts to complete the Working Sheet, and the information needed is as follows:<\/p>\n <\/p>\n The Share Certificate is a legal document that signifies the ownership of the shares specified; the issuance of the Share Certificate will be authorised by the affixation of the company\u2019s Common Seal.<\/p>\n For a transfer of shares, the following steps will take place:<\/p>\n
\nIn general, the corporate shareholder will approve,<\/strong><\/p>\n\n
\nHowever, the use of Common Seal is not common overseas though it is the norm for companies incorporated in Singapore to have a Common Seal. As such, the wording on the relevant documentation will be amended accordingly to suit the circumstances if the transferor or transferee is a foreign company.<\/p>\nB. Pre-emptive Rights<\/h3>\n
C. DRIW to note the purchase \/ sale \/ acceptance of shares and authorise the affixation of the company\u2019s Common Seal on any documents relating to the transfer<\/h3>\n
D. Instrument of Transfer to be executed by transferor and transferee<\/h3>\n
E. Working Sheet relating to the transfer of Shares<\/h3>\n
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F. Share Certificate<\/h3>\n
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