Right of first refusal, pre-emption and consent – what is the difference in a share transfer?
Share
As a general rule, shares are freely transferable, but the articles of association may contain restrictions that limit who may purchase shares and the order in which a transfer may be carried out. The three central mechanisms are consent, right of first refusal, and pre-emption rights.
Facts verified October 1, 2026.
Consent, right of first refusal, and pre-emption rights – quick comparison
| Clause | When does it apply? | Core meaning |
|---|---|---|
| Consent clause | Before the transfer | Shares may be transferred to a new owner only with the company's consent in accordance with the terms of the articles of association. |
| Right of first refusal clause | Before the transfer | A shareholder or other entitled party must be offered the opportunity to purchase the share before it is transferred to a new owner. |
| Pre-emption clause | After the share has changed hands | A shareholder or other entitled party is granted the right to redeem the share after the transfer has taken place. |
Consent clause
According to Chapter 4, Section 8 of the Swedish Companies Act, the articles of association of a company that is not a central securities depository company may include a clause stating that one or more shares may be transferred to a new owner only with the company's consent. Anyone intending to transfer a share subject to this must, according to Section 11, apply for consent before the transfer.
A transfer in violation of a consent clause is void according to Section 17. This makes verification important before the parties commit to an unconditional closing.
Right of first refusal clause
Right of first refusal is regulated in Chapter 4, Section 18 and means that a shareholder or someone else must be offered the opportunity to purchase the share before it is transferred to a new owner. The articles of association must specify, among other things, which transfers are covered and who has the right of first refusal.
Here too, incorrect procedure can have far-reaching consequences. A transfer in violation of a right of first refusal clause is void according to Section 26.
Pre-emption clause
Pre-emption differs primarily in terms of timing. According to Chapter 4, Section 27, the articles of association may grant a shareholder or other party the right to redeem a share that has passed to a new owner. The acquisition thus takes place first, but may subsequently trigger a right of redemption according to the terms of the articles of association.
Which types of acquisitions are covered, who may redeem, and other conditions must be stated in the clause. Therefore, it is not possible to assess the effect simply by knowing that "there is a pre-emption clause" – the actual articles of association must be read.
What does this mean for the share transfer agreement?
Before a purchase or sale, due diligence should include the current articles of association and any shareholders' agreements. The share transfer agreement may then need to be conditional upon obtaining the correct consent or carrying out a right of first refusal process. In the case of pre-emption, the parties need to manage the risk that the shares will be redeemed by an entitled party after the acquisition.
A shareholders' agreement may also contain contractual transfer restrictions between the parties. This should be analyzed separately from the company law-based clauses in the articles of association.
Also read Share transfer agreement – what should the agreement contain? and Due diligence in share transfers.
Template package for share transfer
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See Share Transfer Agreement Template Package 2026
