Is the inter-company share agreement valid?

Legal analysis: mainly depends on the identity of shareholders and the articles of association. If the shareholders explain the transferred equity at the board meeting and half of them pass. The equity transfer signed by shareholders in private has legal effect. If the shareholders transfer their shares without explanation, our laws will not protect them and the agreement will be invalid.

Legal basis: People's Republic of China (PRC) Company Law.

Article 138 Shareholders shall transfer their shares in a legally established securities exchange or in other ways prescribed by the State Council.

Article 139 Registered shares shall be transferred by endorsement or by other means prescribed by laws and administrative regulations. After the transfer, the company shall record the name and domicile of the transferee in the register of shareholders.

Changes in the register of shareholders as mentioned in the preceding paragraph shall not be registered within 20 days before the convening of the shareholders' general meeting or five days before the benchmark date for the company to decide on dividend distribution. However, if there are other provisions in the law on the registration of changes in the register of shareholders of listed companies, those provisions shall prevail.