Adding shareholders

There are two options for adding a new shareholder:

1. An existing shareholder sells a part of their share to the new shareholder

(sections 1 and 2).
2. The share capital of the company is increased and thereby a new share is
issued for the new shareholder (section 3).

A share can be sold in three ways under the first option:

1. It is provided by law that a disposition for the transfer of a share must be

notarised. Since notaries provide remote notarisation services, e-residents can
also conclude the transaction successfully without being in Estonia. This
process has the following steps:

1.1. Unless the Articles of Association prescribe otherwise, a

shareholder of the private limited company must adopt a resolution on the division of
the share by which they divide the share held by them according to the part of the
share they want to transfer.

1.2. Next, they must contact a suitable notary to prepare the

required documents (many notaries also offer the option to prepare the documents in
English; an additional fee will then be agreed upon with the notary).

1.3. If a contract for purchase and sale of the share has been
signed in the context of remote notarisation, the notary will send the required
notification to the Commercial Register and the necessary entry for adding the new
shareholder will be made in the register.

1.4. This process is not long – notaries usually prepare this contract
within a few days, but if additional documents must be sent from abroad or the
transaction is to be made in English, it depends on the respective circumstances. The
registration department registers the change within a couple of days.

1.5. The notary fee depends on the value of the share to be sold.

2. If the company’s share to be transferred has been registered in the Estonian

Register of Securities, the requirement of notarial authentication does not apply to the
transfer of this share. To register a share in the Estonian Register of Securities, the
following steps must be taken:
 2.1. Each shareholder must have a bank account and a
securities account in an Estonian commercial bank.

2.2. The company must submit the following documents to the

register (available at Admission of Securities — Nasdaq CSD ):

2.2.1. An application for the registration of shares (if the

share capital has been divided into shares of different classes, the application must
be submitted separately for each class of shares).

2.2.2. The list of shareholders. In the case of shares of

different classes, the list of shareholders must be submitted separately for each class
of shares.

2.2.3. The Resolution of the Shareholders or the Minutes

of the Meeting concerning the entry of the shares in the register of securities.

2.2.4. If the shareholder is a foreign legal entity who holds

more than 25% of the shares, information must be submitted about this legal entity’s
shareholding by completing the form until the section about the beneficial owner. In
this case, it must be taken into consideration that the process of verifying the
beneficial owner may take some time depending on the situation.

2.2.5. A notarised specimen signature of a board member

or its copy from the Commercial Register (there is no need to include this if the
documents are signed in person at the Estonian branch of Nasdaq CSD or if they are
signed digitally).

2.2.6. The preparation of the documents takes up to a

week and the shares are entered in the register within five working days after the
submission of the aforementioned documents. Under expedited procedure, they will
be entered within one working day.

2.2.7. The processing fee charged by Nasdaq CSD is

30 euros + VAT or, in the case of expedited procedure, 100 euros + VAT. Legal
expenses associated with drawing up the necessary documents are added to the
processing fee in accordance with the price list applicable to Xolo OÜ or a prior
agreement. After the registration of the shares, securities transactions can be carried
out in a bank according to the price list of the bank used.

3. If the share capital of the private limited company is increased to at least 10,000
euros, the requirement of a notarised format can be waived in the Articles of
Association and it can be prescribed that the agreement on the transfer of a share is
at least in a format which can be reproduced in writing. All shareholders of the private
limited company must be in favour of adopting such a resolution upon amendment of
the Articles of Association. This process has the following steps:

3.1. The shareholder(s) must adopt a resolution amending the

Articles of Association, increasing the share capital to at least 10,000 euros and
waiving the requirement of notarisation.

3.2. After the adoption of the resolution, the shareholder(s) must

make a monetary or non-monetary contribution to the share capital of the company.

3.3. The management board of the company registers the relevant

changes in the Commercial Register.

3.4. The preparation of the documents takes up to a week and the

registration department reviews the petition entry within five working days on average.

3.5. It must also be taken into consideration that a rather large

monetary or non-monetary contribution must be made – for example, in the case of a
company whose share capital is 2500 euros, the payment must be at least 7500
euros.

3.6. The state fee for filing the petition entry is 18 euros and legal
expenses associated with drawing up the necessary documents are added to it in
accordance with the price list applicable to Xolo OÜ or a prior agreement.

In the case of the option described in section 3 (increasing the share capital), the
share capital of the company has to be increased by the desired amount. This
process consists of the following steps:

1. The shareholders adopt a resolution to increase the share capital and, if

necessary, amend the Articles of Association.
2. The new shareholder must make a monetary or non-monetary contribution
corresponding to the nominal value of the share to be issued to them.
3. After the adoption of the resolution, the management board submits said
resolution, the bank statement of the company or the documents certifying the
transfer of a non-monetary contribution and its value and the list of
shareholders to the Commercial Register. Thereafter, the registrar makes the
required entry.
4. The preparation of the documents takes up to a week, but how quickly they
can be submitted to the register depends on whether documents from abroad
need to be submitted. Upon receipt of documents from abroad, the documents
can be submitted within five days. The registration department reviews the
petition entry within five working days on average.
5. The state fee for filing the petition entry is 18 euros and legal expenses
associated with drawing up the necessary documents are added to it in
accordance with the price list applicable to Xolo OÜ or a prior agreement. In
addition, the cost of making a contribution to the share capital must be taken
into consideration.
A company with several shareholders can be founded in the Company Registration
Portal, but the API of the Centre of Registers and Information Systems (RIK) does not
enable this. A state fee of 190 euros must be paid in order to found a private limited
company in the Company Registration Portal.