Mastering share transfers in Estonian companies: your comprehensive guide to smooth transactions

In the world of business, share transfers are a common occurrence, whether it’s within a private limited company or a public limited company. Understanding the intricacies of share transfers is crucial for both shareholders and potential investors.

In this comprehensive guide, we will take a look at the process of transferring shares in private and public limited companies, outlining the legal requirements, restrictions, and the key differences between the two.

List of shareholders and transfer of shares in a private limited company

The basics of share transfer

In a private limited company, the transfer of shares is governed by the Commercial Code. Shareholders have the option to transfer their shares to another shareholder or even to a third party. However, this process isn’t always straightforward.

Additional conditions in articles of association

Articles of association may stipulate additional conditions for share transfers. These conditions can range from requiring approval from other shareholders to obtaining consent from the management board or supervisory board.

Before initiating a share transfer, it’s essential to thoroughly review the articles of association for any such conditions.

Right of pre-emption

One of the unique aspects of share transfers in private limited companies is the right of pre-emption. When a shareholder intends to transfer shares to a third party, existing shareholders have the first right to purchase those shares within a month of the transfer agreement’s presentation.

This mechanism ensures that existing shareholders maintain control and influence over the company’s ownership.

Notarial authentication

For share transfers to third parties, notarial authentication is generally required by an Estonian notary. This authentication adds a layer of legal formality to the transaction, providing clarity and security for all parties involved.

Waiving formal requirements

To simplify share transfers, private limited companies with a fully paid share capital of at least €10,000 can waive the formal requirements via their articles of association. This amendment must be registered in the business register, along with a note confirming the waiver.

The articles of association can specify a suitable form for share transfers, ensuring clarity in the process.

Keeping a list of shareholders

Shares in a private limited company are recorded in a list of shareholders. There are three methods of maintaining this list:

  1. Business register: The list of shareholders can be kept by the business register. In this case, share transfers are considered complete upon registration. This method offers a high level of security and reliability for third parties.
  2. Board of directors: If a private limited company has waived notarial requirements, the list of shareholders is maintained by the board of directors. The transfer is deemed effective after notifying the company and certifying the transfer.
  3. Estonian Register of Securities: Private limited companies can choose to register shares in the Estonian Register of Securities, bypassing notarial formalities. This approach simplifies the transfer process and adheres to the rules of the Estonian Register of Securities.

Inheritance of shares

Shares in a private limited company are inheritable. However, articles of association may include provisions to exclude or restrict the transfer of shares to successors. Such restrictions often require compensation to be paid to the successor.

Joint ownership

Private limited company shares can be jointly owned, such as in the case of spouses. In such instances, the rights associated with the shares can only be exercised jointly.

Transfer of shares in a public limited company

Registered shares and share register

In a public limited company, shares are registered and entered into the Estonian Register of Securities. The shareholder listed in the share register holds the rights associated with the share. This register is maintained by the Estonian Register of Securities or another depository.

Transferability of registered shares

Registered shares in a public limited company are generally freely transferable. However, the articles of association may grant existing shareholders the right of pre-emption when shares are being transferred to third parties.

Transactional acquisition

Share transfers in public limited companies follow the provisions of the Securities Register Maintenance Act. The acquisition of a share and the related dispositions do not require specific formats and are processed through the securities account operator at a bank.

Entry in share register

Upon acquiring a share, the transferee has the right to demand entry into the share register. For the public limited company, the share is considered transferred once the transferee’s entry in the share register is complete.

The management board of the company is responsible for promptly updating the share register.

Inheritance and joint ownership

Shares in public limited companies are inheritable, and in the event of a shareholder’s passing, the shares are transferred to their successors. Just like in private limited companies, public limited companies may also have shares jointly owned by multiple individuals, requiring joint decision-making for share-related actions.

A note on listed public limited companies

It’s important to distinguish between regular public limited companies and listed public limited companies. Listed companies have their shares traded on a regulated securities market, such as the Nasdaq Tallinn Stock Exchange in Estonia.

Listed public limited companies face stricter regulatory requirements to ensure transparency, reliability, and fair treatment of investors. These companies are subject to supervision by the Financial Supervision Authority, adding an extra layer of oversight.


Navigating the intricate world of share transfers in private and public limited companies can be a daunting task. However, with the right knowledge and guidance, this journey can be both smooth and rewarding.

At Incorporate, we’re here to assist you every step of the way. Whether you’re a shareholder seeking to transfer your shares or a company looking to make registry entries, our expert services are tailored to meet your needs.

How can we help?

  1. Expertise: Our team comprises seasoned professionals with in-depth knowledge of Estonian corporate law. We understand the nuances of share transfers, articles of association, and regulatory compliance.
  2. Experience: With years of experience in facilitating share transfer transactions, we have a proven track record of ensuring seamless and legally sound processes.
  3. Authority: We are recognised and trusted in the industry for our commitment to transparency, reliability, and efficiency.
  4. Transparency: We believe in open communication and transparency in all our dealings. You can trust us to provide clear guidance and keep you informed throughout the process.

Explore our services

We offer a wide range of services to cater to your specific needs, ensuring that your share transfer journey is a successful one. You can contact us here.


Can a private limited company change its articles of association to waive notarial requirements for share transfers?

Yes, a private limited company with a fully paid share capital of at least €10,000 can amend its articles of association to waive notarial requirements for share transfers. This change must be registered in the business register, along with a note confirming the waiver.

What happens if existing shareholders do not exercise their right of pre-emption in a private limited company during a share transfer?

If existing shareholders do not exercise their right of pre-emption within one month of the presentation of the transfer agreement, the seller can proceed with the share transfer to the third party without further hindrance.

Are there any exceptions to the right of pre-emption in public limited companies?

Public limited companies generally allow for the free transfer of shares. However, the articles of association may stipulate that existing shareholders have the right of pre-emption when shares are transferred to third parties. This right can be restricted or excluded based on the company’s specific provisions.

Disclaimer: This article provides general information, which may or may not be correct, complete or current at the time of reading. No recipients of content from this site should act on the basis of content of the article without seeking appropriate legal advice or other professional counselling.

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