A company’s shares can be bought from the company directly by way of allotment of shares or these can be acquired from another shareholder by way of transfer.

What is meant by Share Transfer and How it Works?

Share transfers take place when the shareholders in a company transfer their shares to new or existing shareholders. Transfer of shares can occur when the shareholders / members want to sell their shares or when a company is being sold or bought. It is also a way to alter the current proportion of shares between the shareholders.

Certain conditions apply to the transfer of shares, these include the following:
  • The directors of the company must approve the form of the instrument, by means of which the shares are transferred, in writing;
  • The share transfer instrument should be executed on behalf of the transferor. However, if the shares being transferred are not paid for in full, the instrument will then be completed on behalf of both the transferor and the transferee;
  • It is essential that the instrument is executed properly in all respects and delivered to the company, in order for it to take effect;
  • A share transfer form is required to be filed Revenue Commissioners.

These transfers will be mentioned in the annual return filed by the company subsequent to such transfers therefore these are not required to be notified separately to the CRO.

What is meant by Allotment of Shares and What are the Relevant Rules?

A company carries out allotment of shares for various purposes. These include raising money, organising / reorganising a company’s structure, bringing in new investors or converting loan to equity.

Allotment of shares is subject to various restrictions under the law. Some of these are listed below:
  • The additional shares issued under the allotment should not exceed the amount of any unissued authorised capital;
  • The allotment of shares is exercised by the directors of the company in accordance with the Memorandum and Articles of Association of the company.;
  • The CRO must be notified of any allotment of shares on the Form B5. This form should be filed within one month from the date of allotment.

Fusion Formations Can Help You with Share Transfers / Allotment

We, at Fusion Formations, are fully aware of the complexities involved in the process involving share transfers or allotment of shares. Our aim is to provide professional advice to our clients and help them with the execution of share allotment / transfer in the best possible way and in compliance with the statutory requirements.

Our package for handling Share Transfer / Allotment of shares for your company comes for €250.00 only. This is a comprehensive package whereby we ensure complete compliance of all the requirements with regards to provisions of the law relevant to share transfer / allotment of shares, as the case may be.