in order for a shareholder to successfully transfer all or part of its equity, and for a transferee to successfully acquire all or part of its equity and become a new shareholder, it is necessary to abide by the relevant provisions of the General Principles of Civil Law, Contract Law, Company Law and other laws and regulations, and shall not violate mandatory norms. Any contractual arrangement that circumvents the law is prohibited and denied by law. 1. Prevention of signing risks When a shareholder of a limited company transfers its equity to a person other than the shareholder, the conclusion of the contract shall comply with the procedural requirements of the Company Law. When a shareholder of a limited company transfers its capital contribution to a person other than a shareholder, it must be agreed by more than half of all shareholders; Shareholders who do not agree to the transfer shall buy the transferred capital contribution. If they do not buy the transferred capital contribution, they shall be deemed to agree to the transfer of the capital contribution agreed by the shareholders. Under the same conditions, other shareholders have the preemptive right to the capital contribution. The equity transfer contract signed without the above procedures will be deemed invalid or revoked due to the defects of the procedures. The signing of the equity transfer contract shall not violate the restrictive provisions of laws, regulations, policies or the articles of association on the transfer time, the transferee and the transferee. The Company Law stipulates that the shares held by the promoters of a joint-stock company shall not be transferred within three years from the date of establishment of the company; The shares of the company held by the directors, supervisors and managers of the company shall not be transferred to the main body that is prohibited from engaging in profit-making activities according to laws, regulations and policies during their term of office, and shall not be transferred to the company's equity to become shareholders of the company. Where laws and regulations prohibit the rights and abilities of trading subjects, such subjects may not enter into equity transfer contracts in violation of the regulations. For example, shareholders may not transfer their equity to the company itself, and the Commercial Bank Law prohibits commercial banks from investing abroad in the form of transferring the equity of non-bank financial institutions and enterprises in China. 2. Prevention of Validity Risk Unless the laws and regulations stipulate that the equity transfer contract shall go through the formalities of approval and registration to take effect, the legally established equity transfer contract shall take effect upon its establishment. If the law stipulates that the equity transfer contract can only take effect after going through the approval procedures, it is mainly limited to the equity transfer of Sino-foreign joint ventures, Sino-foreign cooperation, foreign-invested limited companies and the transfer of state-owned equity in companies. The existing law does not stipulate that the equity transfer contract can only take effect after going through the registration formalities, so registration is not an important element for the contract to take effect. The change registration of shareholders' register or industrial and commercial change registration is the confirmation of the fact that the equity transfer has occurred, and it can only be carried out after the equity transfer contract takes effect and is performed. 3. Prevention of performance risks The effectiveness of the equity transfer contract only determines the rights and obligations between the transferor and the transferee, and the actual transfer of equity depends on the actual performance of the contract. The actual transfer of equity is the delivery of equity. After the equity transfer contract comes into effect, the parties may perform it according to the contract, and the transferor will deliver the equity and accept the price. The transferee pays the price and accepts the equity. It is also possible that one or both parties violate the contract, which leads to the state that the equity transfer contract takes effect but is not actually performed. The transferee has the right to claim for the delivery of equity and compensation for breach of contract, and the transferor has the right to request for assistance in performance and compensation for breach of contract. Equity is a combination of rights and obligations. For companies with good property structure and operating results, the transfer of equity means that they can get more benefits. On the contrary, it means that they have to bear more risks and responsibilities, especially when shareholders make inadequate contributions, make false contributions, withdraw funds and the company is insolvent. In the performance of the equity transfer contract, the transferor's main obligation is to transfer the equity to the transferee, which is embodied in the act of formally notifying the company in writing of the fact of equity transfer and the intention of requesting the company to go through the formalities of change registration. The transfer point of the rights of the transferor and the transferee is from the time when the notification is completed. Before the change of the company's register of shareholders, the right of the new shareholders to dispose of their shares is restricted to a certain extent. The new shareholders should declare themselves as shareholders of the company on the basis of the shares or capital contribution certificates issued to them by the company or the registration of the register of shareholders. The transferee's main obligation is to pay the transfer price to the transferor as agreed. According to Articles 36 and 145 of the Company Law, it is the company's obligation to record the results of equity transfer in the register of shareholders, amend the articles of association, and change the industrial and commercial registration. The directors of the company have the obligation to handle it in time, and other shareholders of the company have the obligation to cooperate and assist. If the company fails to fulfill its obligations in time, the transferee may sue the company, and the company shall bear corresponding responsibilities. However, the company has no obligation to supervise or judge the performance of other obligations stipulated in the transfer contract. After the transferor performs the notification obligation, the transferor's main obligations are fulfilled unless otherwise agreed. As for the attitude and actions taken by the company and other shareholders, it is often beyond the control of the transferor. The transferee can't normally obtain shareholder status or exercise shareholder rights. If the transferor is not at fault, it doesn't have to bear the consequences arising therefrom, and disputes arise. In judicial practice, the people's courts generally don't support the transferee's request to terminate the contract for the above reasons. If the company is slow or refuses to perform its obligations, so that the transferee can't normally obtain shareholder status or exercise shareholder rights, the transferee's rights can be legally relieved by suing the company or directors. The court may order the company or directors to perform their obligations as prescribed by law, and eliminate the obstruction to shareholders' exercise of their rights. Equity delivery includes equity ownership change and equity power transfer. The capital contribution certificate of a limited company and the shares of a limited company are all forms of proof of the ownership of shareholders, which is a record of the effectiveness and performance of the equity transfer contract. The transfer of power refers to the actual exercise by shareholders of various rights such as the beneficial right to participate in the management of the company and the self-beneficial right to distribute the profits of the company. The value of ownership change lies in the legal recognition of equity and the prevention of legal risks. The value of power transfer lies in the actual exercise of property interests and other rights and interests invested by shareholders. The change of ownership is more important than the transfer of power, because the exercise of power lacks its legitimacy without the support of ownership. In practice, it often happens that the ownership is changed without transferring the power or the power is transferred without changing the ownership, which has laid a curse for the dispute over the transfer of equity. Therefore, the equity transfer contract should clearly stipulate ownership change and power transfer. The transferee may not perform or not fully perform the obligation to pay the equity transfer price during the transaction. In order to prevent the risk of the transferee's failure to pay the equity transfer price, the equity transfer contract should clearly stipulate the deposit penalty or the scope of default compensation and the calculation method of default compensation. The transferor may also require the transferee to make a guarantee or provide a guarantee to safeguard its legitimate rights and interests.