08 Oct

Share Purchase Agreement Template Luxembourg

Are transactions generally subject to closing conditions? Describe the closing conditions that are generally acceptable to a seller and any other terms a buyer wishes to include in the agreement. Workers` rights (including pension rights arising either from the contract or from the overall employment contract) are maintained by the transfer. The transfer of the contract is automatic. The only condition is that the seller is required to inform the buyer of all rights and obligations arising from the transaction (a copy of this notification must be made available to the employment services). However, the absence of notification does not affect staff and does not affect the transfer of contracts (and rights related to such contracts) for staff. However, in practice, many sales contracts are not registered. The non-registration of a contract does not affect its validity between the parties. However, registration makes the agreement enforceable vis-à-vis third parties from the date of registration, allowing the buyer to rely on the agreement against a third-party buyer to whom the seller may have sold the building in breach of contract. The BSMZ generally contains the most common standard clauses defined in this type of agreement, and in particular: capital gains realized by a Luxembourg company on the sale of a shareholding may benefit from the participation exemption scheme, provided that the Luxembourg collective entity fully taxable holds for an uninterrupted period of at least 12 months. a stake of at least 10% of the share capital of the company sold in nominal terms or a stake with a purchase price of at least €6 million. The subsidiary must in turn be a limited liability company established in a Member State of the European Union (within the meaning of Article 2 of Directive 2015/121) and which is subject, in its country of residence, to corporation tax equivalent to corporation tax, calculated on a tax base similar to the Luxembourg tax base. The party whose fault or negligence is the cause of the non-compliance with the agreement may then be ordered to pay the other party the amount of the penalty clause, if one of them was included in the agreement, or to compensate it for the damage actually caused. In many cases, the parties determine in the agreement who will pay the notary fees and, if applicable, the real estate agency fees.

The preparation and signing of a sales contract is subject to 2 conditions: the usual consideration is in cash; However, for legal and tax reasons of structuring, it is customary that a consideration in kind (shares or a seller`s note) is also paid. The Luxembourg law on registration fees expressly provides that shares are transferred to a Luxembourg company without proportional registration fees. However, the transfer for consideration of shares in a partnership holding Luxembourg immovable property is subject to a registration fee of 6%. Beyond these references, virtually all sales contracts contain a number of special clauses that bind the sale mentioned in the contract to conditions. Seller or Buyer shall in due course consult with the legal representatives of its respective personnel with respect to such measures and shall enter into an agreement on such measures when reviewing the measures taken with respect to its respective employees. The parties are free to negotiate the terms of these agreements in any language and no standard form is required. The effect of presale contracts is to retain the parties and the transfer of ownership documented in such contracts is perfectly valid. However, these agreements are not applicable to third parties; A notarial deed is necessary so that they can be implemented vis-à-vis third parties. To be valid, the sales contract must include at least the names and addresses of the parties, the name (cadastre references, etc.) of the property for sale, the sale price and the terms of payment. .

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