Question: Please provide more details about the reduction of charter capital in case the company returns part of the stakes to shareholders?
Answer:
According to Point a Clause 5 Article 111 of the Enterprise Law 2014, decision of the General Meeting of Shareholders, the company returns part of the stakes to shareholders in proportion to their holding, provided that the company has continued its business operation for more than 02 years from the business registration date, and that all debts and liabilities can be paid after the return.Based on the above-mentioned provisions, of charter capital in case the company returns part of the stakes to shareholders shall be conducted once satisfy the following conditions:
- The company returns part of the stakes to shareholderin proportion to their shareholding in the company.
- The company has been doing business for more than 02 years since the registration of the enterprise.
- After repayment to shareholders, the company must ensure to pay all debts and other property obligations.