Buying company shares: a power of attorney is not registered ownership

For an LLC governed by the Commercial Companies Law, transferring a stake involves formal documentation and commercial registration for effectiveness against the company and third parties. A power of attorney can authorise someone to act; it does not itself replace the ownership transfer and registration.

Check the legal name, licence number, issuing authority and permitted activity through official channels. Obtain incorporation documents, current partner records and evidence that the seller can transfer the stake. A valid business licence does not establish that the company has no debts or disputes.

Due diligence should go beyond a licence screenshot. Have suitable advisers examine ongoing contracts, financial statements, relevant bank records, unpaid wages, taxes, guarantees and existing or disclosed proceedings. Ask for evidence where records are incomplete; a low purchase price is not an explanation.

A share purchase concerns an existing company with an existing history; purchasing identified assets is a different transaction. Record exactly what transfers, who bears which obligations and how undisclosed matters are addressed. Free-zone rules and other company forms require their own assessment.