LAW FIRM IN BANGLADESH TRW LOGO TAHMIDUR RAHMAN

Contact No:

+8801708000660
+8801847220062
+8801708080817

Global Law Firm in Bangladesh.

Locations

Dhaka:  House 410, Road 29, Mohakhali DOHS
Dubai:
 Rolex Building, L-12 Sheikh Zayed Road
London:
 1156, St Giles Avenue, Dagenham

Share Transfer Process of a Bangladeshi Company | Cost, Required Documents & Restrictions | A complete Overview of How to Transfer Share

Share Transfer Process of a Bangladeshi Company | Cost, Documents| Overview

A Complete Transfer Share Overview In Bangladesh Company Law Firm In Bangladesh Tahmidur Rahman
Tahmidgoldenpicturebackground E1569742859700

Tahmidur Rahman, Senior Associate, TR Barristers in Bangladesh

9 January, 2020

Table of Contents

Find the subsections below, If you want to jump through specific sections instead of reading the whole article.

Share Transfer Of Company In Bangladesh
[lwptoc]

What is ‘Share’ according to Bangladeshi Law?

The term ‘share’ is defined in Sec. 2 (1) (v) of the Companies Act of 1994, which reads as below:

  “Share means a share in the share capital of a company, and includes stock except where a distinction between stock and share is expressed or implied.”

Why a Company would like to Transfer Share in Bangladesh 

Share Transfer Process of a Company in Bangladesh can be a seamless process for both private and public limited companies. If someone (who is the company’s shareholder) wants to transfer his / her share to another person or if he / she does not want to remain the shareholder or director of this company, he / she may leave the share to someone else. Basically the existing shareholder of the company buys this particular share otherwise the new shareholder or director of this company may be involved by purchasing the transfer share. Monitoring of this activity by the Joint Stock Company Registrar and Firms (RJSC). The share allocation of the company is also a process that gets monitored by RJSC in Bangladesh.

The managers of the company may want to add experienced or veteran professional for some time to increase the business capacity of the company. The addition of a new shareholder or the company’s director is therefore a fairly conventional process. Companies generally include experienced business people in a particular area or country to increase the market and profit ratio of the company. RJSC is the only authority in Bangladesh for Company Registration, Share Transfer, Share Allotment, Wind-up and related business activities.

How to Share Transfer of a Company in Bangladesh?

In this infographics, the six steps is shown on how to transfer company shares in Bangladesh.

Six Steps Of Share Transfer Of A Comapny Law Firm In Dhaka Bangladesh

Shares in a company registered in Bangladesh are a movable property that can be transferred in a manner given in the company’s Articles of Association. But before proceeding with the Transferring Shares process, it is important to remember that the right to transfer shares may be restricted in a private limited company. Share Transfer Process of a Company is pretty straightforward if it’s not then.

If you want to know how to open a company in Bangladesh or about company formation click here!

Six Steps of Transferring Company Shares in Bangladesh

 

Here we have described in details (six steps), the procedure of transferring shares of a private limited company registered in Bangladesh.

 

Step1: Find out whether there was any existing restrictions against Share Transfer

 

The share transfer in a Private Limited Company can be restricted by the Articles of Association (AOA). Thus, the Articles of Association of the Company must be assessed before starting the offer exchange method. It is basic in Bangladesh that the organisation’s articles of affiliation typically contain pre-concurred methodology set out that are required to be followed for any exchange of offers in the organization.

 Limitations on right of the investors to move shares are for the most part as pre-emption. Which implies that if an investor wishes to sell a few or the entirety of his offers, such offers should initially be offered to other existing individuals from the private constrained organization at a value controlled by the Directors or the Auditor of the Company. In no current investor is intrigued, at that point portions of the Company can be unreservedly moved to an untouchable.

On the off chance that there is any limitation or extraordinary techniques, those confinement or strategy must be followed for any offer transfer.Which implies that if an investor wishes to sell a few or the entirety of his offers, such offers should initially be offered to other existing individuals from the private constrained organization at a value dictated by the Directors or the Auditor of the Company. In no current investor is intrigued, at that point portions of the Company can be openly moved to an outcast.

Hence, all the license, permits, agreement etc. should be checked for any restriction imposed on share Transfer Process of a Company. If there is any restriction, prior approval should be obtained.

Share Transfer Law Firm In Dhaka Tahmidur Rahman 1

 

Step 2: Notify the Board of the Directors of the Company

 

The Shareholder intending to move the offers should serve notice recorded as a hard copy to the Board of Directors of the Company about expectation to move portion of the organization. The Director may have the forces to deny enlistment of move of offers in specific situations – endorsed in the Articles of Association. The Board of Directors should hold an executive gathering and endorse the exchange of the offers. The Director ought to likewise give a declaration in this respect. 

Step 3: Paying the Price of the intended shares

Once the company has granted its approval, the price of the shares should have been paid. If both buyer and seller are local or foreign, there is no requirement for proof of payment. However, if the seller is a Bangladeshi and the buyer is a foreigner, the Joint Stock Companies and Firms Registrar (RJSC) will require a letter of bank encashment for the transfer of the share.

Step 4: Completion of Form 117

Once the company has granted its approval, the price of the shares should have been paid. If both buyer and seller are local or foreign, there is no requirement for proof of payment. However, if the seller is a Bangladeshi and the buyer is a foreigner, the Joint Stock Companies and Firms Registrar (RJSC) will require a letter of bank encashment for the transfer of the share.

How To Transfer Share In Bangladesh Company Law Firm In Bangladesh Tahmidur Rahman

“TR Barristers in Bangladesh is Considered as one of the leading firms in Company Law in Dhaka, Bangladesh”

Carpe Noctem Bangladesh

Step 5: Payment of Stamp Duty

Stamp duty is payable on the face value of each share.

Once the Form 117 is signed, a copy of the same should be delivered to the Company.

Step 6: AMENDMENT OF THE SHARE CERTIFICATE REGISTRAR BOOKS AND ISSUANCE.

Upon completion of the above steps, the company should update its share registrar, share transfer registrar, minutes registrar, and issue a share certificate in favour of the new shareholder or modify the existing share certificate to reflect the changes.

Essential documents needed for Share Transfer of the Company

 

Essential documents needed for Share Transfer of the Company:

1. Letter from Company’s board of director approving the transfer company’s share.
2. A document indicating Number of shares to be transferred of the Company.
3.A completed (signed) Company form 117.
4. Board Resolution by the company approving the transfer of the shares; and
5.Certificate of Transfer of Shares.

Company Share Law Firm In Dhaka Bangladesh
Custom Law Firm In Bangladesh Tahmidur Rahman
Custom Law Firm In Dhaka

What makes TRW the best law firm in Dhaka?

What Makes Tahmidur Remura Wahid (TRW) Law Firm the Best Law Firm in Dhaka? In the legal landscape of Bangladesh, choosing the right law firm can be a daunting task for clients, given the abundance of legal practitioners and firms offering similar services. However,...

Minors as per the Law of Bangladesh

Who are Minors as per the Law of Bangladesh Minors as per the Law of Bangladesh: Understanding who qualifies as a minor under the law is crucial for legal practitioners, policymakers, and citizens alike. In Bangladesh, the legal definition of a minor is shaped by...

Admission in Evidence Act of Bangladesh

What is the Admission in Evidence Act? Admissions are defined in Sections 17 to 31 of the Bangladeshi  Evidence Act, 1872. General admittance is the subject of Sections 17 to 23, while confession is the subject of Sections 24 to 31. A confession is a valid and...

Setting Up a Tea Estate in Bangladesh

Setting Up a Tea Estate in Bangladesh: A Comprehensive Guide by TRW Law Firm Bangladesh, with its favorable climate and fertile land, is one of the world's key tea-producing countries. The country's tea estates, primarily located in the Sylhet and Chittagong regions,...

Arrest Warrants Issued by Pure Food Courts in Bangladesh

Arrest Warrants Issued by Pure Food Courts and Jurisdiction of DSCC Courts in Bangladesh Food safety is a critical concern in Bangladesh due to widespread food adulteration affecting consumer health. Recognizing this, the government has implemented robust legal...

Suspense Account in Bangladesh

A Suspense Account in Bangladesh: What Is It? Examples, Types, and How It Operates Depending on the context, "suspense account" might mean a number of various things. A suspense account is a component of a company's financial accounts that, in the business sector, is...

How to transfer business ownership in Bangladesh

How to Change Business Ownership in Bangladesh: Your business will change as life does as things change all the time. It will be simpler for you to handle change as a business owner if you have a well-thought-out exit strategy [that will benefit your company's...

Export Registration Certificate in Bangladesh

Export Registration Certificate in Bangladesh 2024 Any business entity that wishes to export any authorized domestic commodities from Bangladesh, regardless of value or quantity, must get an Export Registration Certificate. This Certificate's legal basis is stated in...

Indenting Registration Certificate in 2024

Indenting Registration Certificate in Bangladesh REQUIRED SUPPORTING DOCUMENTS: Attested photograph of entrepreneur/managing partner/managing director. Attested copy of trade license. Membership Certificate from Local Chamber of Commerce and Industries or Bangladesh...

How to get BGMEA Membership in Bangladesh

BGMEA Membership in Bangladesh The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) stands as a cornerstone of the country's textile and garment industry, representing the interests of manufacturers and exporters. Membership in BGMEA is highly sought...
Want new articles before they get published?
Subscribe to our Awesome Newsletter.

Other posts you might like

Call us!

× WhatsApp!
/* home and contact page javasccript *//* articles page javasccript */