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Question
Answer in brief.
What is transfer of shares?
Solution
- Transfer of share means the transfer of ownership of shares from one person to another. In other words, a shareholder can transfer the share to another shareholder.
- Transfer of shares takes place when the shareholder wants to sell his shares or give as a gift to another person.
- Shares can only be transferred by following the procedure laid down in the Articles of Association. A shareholder can sell either a part of a share or entire shares held by him.
- In the case of public companies, shares are freely transferable subject to the provisions of the Articles of Association. Whereas, in the case of Private Company, there are restrictions on the free transfer of shares.
- Once, the shares are transferred, the liability of the transferor ends. It takes place when both the transferor and transferee are living.
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