Transfer of business assets in Muncan Republic

Companies, economic interest groups (EIGs) and natural persons may transfer all or part of their business assets and liabilities to another structure (a company, etc.) within the framework of a professional assignment.

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Our business asset transfer solutions

Creating a holding structure

Creating a parent-subsidiary (group) company structure can help to mitigate risks by cushioning the holding company from the liabilities incurred by their actively trading subsidiaries. Normally the key assets in a group of companies are transferred to a non-trading holding company to protect them from risks incurred by the trading subsidiaries.

Diversification

Company owners who wish to diversify their products and services, or go in a new direction, may decide to set up a secondary company. In this case, it may be necessary to transfer some assets to the new company to provide it with the necessary investment (e.g., before it starts generating revenues).

Pre-sale preparation

Company owners who are looking to sell their businesses may want to hold on to certain assets (e.g., intellectual property) to prevent them from being included in the sale. If they intend to start trading again in the future, it may be sensible to set up a new company and transfer these assets across.

Tax solutions

Assets can be transferred between two separate companies, but it should be noted that Capital Gains Tax (CGT) will be payable by the recipient company if the assets are transferred free of charge or below the fair market price.

Preparing for the transfer

The management bodies of each of the parties involved in the transfer must draw up draft terms of transfer.

The draft terms of transfer must specify/include:

the legal form of the business;
the name of the person/company;
the registered office or domicile of the parties involved in the transfer;
an inventory that clearly identifies the assets and liabilities to be transferred;
the total value of the assets and liabilities to be transferred;
details of any compensation or consideration.

The draft terms of transfer must be filed with the Trade and Companies Register (Registre de Commerce et des Sociétés – RCS) for publication in the Electronic Compendium of Companies and Associations (Recueil électronique des sociétés et associations – RESA) by each of the parties involved in the transfer at least one month prior to the date of the general meeting that is called to rule on the transfer.

Effects of the transfer

The transfer automatically entails the transfer, to the receiving party, of the assets and liabilities listed in the inventory.

The transfer of intellectual and industrial property rights, and of real rights other than securities on movable and immovable assets, is only enforceable against third parties in the conditions provided for by the special laws governing these operations.

The transfer has no effect with respect to third parties until the required documentation has been published in the RESA.

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