Source and currentness checkpoint
Verify the current Companies Act 1994, Stamp Act 1899 Schedule I, RJSC Form 117 and Bangladesh Bank foreign-exchange guidance before relying on a duty rate, instrument consequence, board-refusal timeline, valuation method or non-resident reporting route. A fixed rate or older circular is not universal.
RJSC publishes Form 117 and Bangladesh Bank publishes current share-transfer/repatriation guidance, including transaction-specific valuation and reporting conditions. RJSC Form 117 · Bangladesh Bank transfer guidance · Companies Act 1994
Legal Framework for Equity Transfer
Statutory Costs and Regulatory Fees
Ad valorem stamp duty is a prerequisite for the execution of the Instrument of Transfer (Form 117). Stamp consequences depend on the current Stamp Act, the instrument and the proceeding; failure to comply should not be described as an automatic or universal evidentiary result without checking the operative provision.
| Requirement | Statutory Reference | Rate / Authority |
|---|---|---|
| Stamp Duty | Stamp Act 1899, Sch 1, Art 62 | Verify current Stamp Act schedule and instrument basis |
| Instrument of Transfer | Companies Act 1994, Sec 38 | Form 117 (Duly Executed) |
| Board Approval | Companies Act 1994, Sec 38(1) | Board Resolution & Minutes |
| Filing Fee | RJSC Schedule of Fees | Based on Authorized Capital |
The Transfer Execution Roadmap
Procedural Mechanics
- Execution of Instrument: The transferor and transferee must execute Form 117. Under Section 38, the company shall not register a transfer unless a proper instrument of transfer duly stamped has been delivered to the company.
- Stamp Duty Affixation: The applicable Stamp Act schedule determines the duty rate and base for the instrument; a 1.5% figure is not treated as universal here. Note that under the Income Tax Act 2023, capital gains tax implications must be assessed prior to execution.
- Board Approval: The Board of Directors must pass a resolution approving the transfer. Per the Articles of Association (AoA), directors typically have discretionary power to decline a transfer, subject to Section 38(2) notice requirements.
- RJSC Submission: The executed Form 117, along with the Board Resolution and original Share Certificates, must be submitted to the Registrar of Joint Stock Companies and Firms (RJSC) for digital record updating.
- Non-Resident Transfers: If the transfer involves a foreign national, Current Bangladesh Bank FEID guidance controls non-resident valuation, reporting and repatriation; thresholds, eligible valuers and route must be checked for the transaction, and an older circular or OFERP reference is not a universal substitute.
Expert Corporate Counsel
Ensure your equity transfers are legally airtight and compliant with the latest RJSC automation protocols.
Consult Barrister Liton SarkarFrequently Asked Questions
What is the time limit for the Board to refuse a share transfer?
Under Section 38(2) of the Companies Act 1994, if a company refuses to register a transfer, it must send notice of the refusal to the transferee and transferor within one month from the date on which the instrument of transfer was lodged.
Is stamp duty mandatory for share transfers in Bangladesh?
Yes, under Article 62 of Schedule I of the Stamp Act 1899, the current Stamp Act schedule determines whether and how ad valorem duty applies to the instrument; a 1.5% rate must be verified for the transaction
Can a transfer be registered without a physical share certificate?
Section 38(1) of the Companies Act 1994 requires the instrument of transfer to be delivered to the company. While the Act emphasizes the instrument, the Articles of Association usually mandate the surrender of the share certificate for cancellation and issuance of a new one.
What records should accompany Form 117?
The executed instrument, share certificate, board records and any current RJSC, tax, valuation or foreign-exchange documents required for the particular transfer should be checked before filing.
What changes for a non-resident share transfer?
Resident status, valuation, reporting and repatriation requirements are transaction-specific. Check the current Bangladesh Bank FEID guidance and the applicable company and tax records before execution.
◆ Related Statutory Guides & Practice Insights
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