HERE'S HOW IT WORKS
A share transfer is the process of transferring existing shares, its related rights and liabilities from one person to another. A transfer of share can only be transferred for only existing shares and from existing shareholders. Though the transferee can be existing shareholder or not of company.
It is a transfer of title of the shares between the transferor (one who transfers) and the transferee (one who receives).
Steps Involved in Transfer of Shares
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Section 2(68) of the Companies Act 2013 provides that the Articles of a private company shall restrict the right to transfer the company's shares.
A public company is a company that is not a private company. As per the Companies Act 2013, a public company has a minimum of 7 members and has no restriction on the transfer of its shares.
Stocks can be given to a recipient as a gift whereby the recipient benefits from any gains in the stock's price.
Typically, shares are transferred to introduce a new shareholder. So long as a company has enough shares, it's possible to transfer shares in a limited company any time after incorporation.