Share Transfer in Hong Kong

Share Transfer in Hong Kong

Hong Kong's dynamic business environment often sees changes in company ownership through the transfer of shares. If you're planning to transfer shares in a Hong Kong company, it's crucial to navigate the process correctly. Here's a comprehensive guide to help you smoothly execute share transfers in accordance with Hong Kong's regulations.

  1. Financial Statement Requirement

Per the Company Ordinance of Hong Kong, any share transfer must be accompanied by a company financial statement dated no more than three months before the transfer date. This necessitates the preparation of a mini-balance sheet and a copy of the latest company Audit Report. This additional financial statement, doesn't need review by a local CPA but must be in English or Chinese and certified with a director's signature.

  1. Documentation Submission

To complete the share transfer, specific documentation must be submitted to Hong Kong's local tax agency, the Inland Revenue Department (IRD). These documents include:
  • Bought and Sold note
  • Instrument of Transfer
  • Letter to IRD
  • Shareholder resolution

Within these documents, you should provide:

  1. Details of the company transferring the shares
  2. Details of the company acquiring the shares
  3. Details of the number of shares to be transferred and the Consideration Value (a fixed value for the sale)

The documentation, prepared with our guidance, must be signed by all parties involved and validated by affixing a stamp duty from the IRD.

The stamp duty cost is calculated at 0.26% on the higher value between the net asset value from the balance sheet and the consideration for the share transfer, in addition to HKD 5. This stamp duty is crucial as it legitimizes the share transfer.

  1. Changing Directors and Officers

If the share transfer also involves changing company Directors, you will need to submit the necessary documentation to the Companies Registry. The forms ND2A and ND4 are typically required. To process this change, you'll need to provide documentation for the new Directors, including copies of their passports, ID cards, or driver's licenses, and proof of residence.

  1. Due Diligence

During the entire share transfer process, and especially if there's a change in Directors or bank signatories, your company will undergo a Due Diligence process, known as Customer Due Diligence (CDD), as part of Anti-Money Laundering Regulations (AML) by the bank.

  1. Timelines

The timeline for share transfers in Hong Kong can vary depending on several factors. Preparing the financial statement and undergoing the Due Diligence process can be time-consuming. However, the good news is that the application of stamp duty, which is the final step and legitimizes the share transfer, typically takes no more than one week.


In conclusion, share transfers in Hong Kong involve several steps and require careful attention to detail. It's highly recommended to work with experts who are well-versed in Hong Kong's corporate regulations to ensure a smooth and compliant transfer process.

Contact us today, and make sure that your documents are compliant with the local regulation.

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