A member of a multiple-member limited liability company is entitled to transfer part or all of their stake to another person except for the cases the company is not able to pay for the repurchase of the stake as requested, or in case a member gives away part or all of his/her stake to another person or in case a member uses that member’s stake to pay debt.
Procedures of
TRANSFER OF STAKES
In a multi-member limited liability companies
Except for the cases the company is not able to pay for the repurchase of the stake as requested, or in case a member gives away part or all of his/her stake to another person or in case a member uses that member’s stake to pay debt, a member of a multiple-member limited liability company is entitled to transfer part or all of their stake to another person as follows:
- Offer the stake to other members in proportion to their holdings under the same conditions;
- Transfer the stake under the same conditions as those applied to other members in proportion to their holdings under the same conditions to a non-member if the other members do not purchase or fully purchase the stake within 30 days from the first day of offering.
- The transferor still has the rights and obligations to the company in proportion to the stake until information about the buyer about Full name, signature, mailing address, nationality and legal document numbers of members that are individuals; names, EID numbers or legal document numbers and headquarters addresses of members that are organizations; Stakes, holdings, contribution time, types of contributed assets, quantity and value of each type of contributed assets of each member… are fully recorded in the member register.
- In case only one member remains after transfer or change of the members’ stakes, the company shall be converted into a single-member limited liability company and apply for change of enterprise registration information within 15 days from the day on which the transfer is complete.
Each form of enterprise has its own advantages and dis-advantages. The investors shall base on actual business industries, business plans to find the right form of enterprise, create more business advantages and prevent risks in advance.
Procedures of re-purchase or transfer of stakes, increasing or decreasing charter capital in multi-member limited liability companies also have more required compliance procedures on tax on investment capital, rights and obligations of the members, business records management…thus those procedures shall be conducted in very strictly and lawful manners.
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