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Transfer of Member Interest in No Share Capital Company
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Transfer of Member Interest in No Share Capital Company

May 20, 2026

Section 56 of the Companies Act requires proper documentation for member interest transfers in companies without share capital.

Transfer of Member Interest in No Share Capital Company

Section 56 of the Companies Act, 2013 mandates the execution of a proper instrument of transfer for member interest in companies that do not have share capital. The instrument must be executed by or on behalf of both the transferor and transferee and delivered to the company.

This provision is crucial in regulating the internal governance of companies without share capital, ensuring that any changes in membership are formally recorded and legally binding. Proper execution of transfer documentation helps maintain transparency and minimize disputes among members.

Legal practitioners should be aware of the requirements for documenting transfers in no-share capital companies to ensure compliance and protect clients' interests during member transitions.

Source:N/A
Practice Areas:corporate

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