Only Fully Paid Shares can be Transferred
- Roger Pay
- Apr 29, 2025
- 3 min read
Singapore Share Transfer Regulations Explained
Only fully paid Shares can be Transferred
The statement "only fully paid shares can be transferred" is generally true under Singaporean company law.
Here's a more detailed explanation:
Fully Paid Shares: These are shares for which the shareholder has paid the company the full subscription price. The company has received the total value for these shares.
Partly Paid Shares: These are shares where the shareholder has only paid a portion of the subscription price, and the remaining amount is still owed to the company.
Why only fully paid shares can be transferred:
Legal Clarity and Simplicity: Allowing the transfer of partly paid shares can complicate matters significantly. It would raise questions about who is liable for the unpaid amount – the transferor or the transferee. This could lead to disputes and administrative complexities for the company.
Company's Interest: The company has a vested interest in ensuring that the full value of its issued shares is received. Transferring partly paid shares could jeopardize the recovery of the outstanding amounts.
Administrative Burden: Tracking the unpaid amounts and ensuring their collection from new shareholders would create a significant administrative burden for the company.
Regulations in Singapore:
The Accounting and Corporate Regulatory Authority (ACRA) in Singapore explicitly states that "only fully paid shares can be transferred." This is also reflected in the "Update Shares Information" e-Service on the Bizfile+ portal, where it mentions this condition under the "Transfer of shares" section.
Practical Implications:
Before a share transfer can be processed, the company will typically verify that the shares being transferred are fully paid.
If a shareholder holds partly paid shares and wishes to transfer them, they would generally need to pay the outstanding amount to the company to make them fully paid before the transfer can proceed.
In summary, the requirement that only fully paid shares can be transferred simplifies the process, protects the company's financial interests, and avoids potential legal and administrative complications.
How Bestar can Help
Bestar is a professional services firm. We offer a range of services that could be helpful in various business contexts.
Here's how Bestar can help:
1. Corporate Secretarial Services:
Ensuring Compliance: Bestar can act as your company secretary, ensuring that all share transfers comply with the Singapore Companies Act and the company's Articles of Association, including the verification that shares are fully paid.
Documentation: We can assist with the preparation and filing of necessary share transfer forms with the Accounting and Corporate Regulatory Authority (ACRA) in Singapore.
Record Keeping: Bestar helps maintain the company's statutory registers, including the register of members, which records share ownership and payment status.
Guidance: We can advise on the correct procedures for share transfers in Singapore, emphasizing the requirement for shares to be fully paid.
2. Legal and Regulatory Compliance:
Professional Advice: Bestar offers professional advice in certain aspects of commercial and corporate law through our consultants and partnered solicitors. This could include interpreting the legal implications of share transfer regulations.
Due Diligence: We can assist with legal due diligence to verify the payment status of shares during a transfer process, identifying potential risks.
Contract Drafting: Bestar can help draft and review share transfer agreements to ensure they are legally sound and compliant with regulations.
3. Share Transfer Processing:
Stamp Duty Processing: Bestar can assist with the calculation and payment of stamp duty, which is a tax levied on the transfer of shares in Singapore.
Liaison: We can liaise with the company and the relevant authorities (like ACRA) to ensure a smooth transfer process.
4. Other Related Services:
Company Incorporation: If you are setting up a new company and issuing shares, Bestar can guide you through the process, ensuring the initial shares are correctly issued as fully paid if required.
Accounting and Bookkeeping: We can help maintain accurate financial records that reflect the payment status of shares.
In summary, Bestar can help ensure that share transfers are conducted legally and in compliance with the "only fully paid shares can be transferred" rule by providing corporate secretarial services, assisting with legal documentation and compliance, and managing the administrative aspects of the transfer process.
To get specific help from Bestar regarding a share transfer, it would be best to contact us directly with the details of your situation. You can find our contact information on our website (bestar-sg.com).
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