Selling or buying a company is often the deal of a lifetime. Behind the headline price lie considerable risks: an overlooked tax or employment liability, an overvalued customer base, a poorly transferred lease, a badly drafted warranty leaving the buyer without recourse. The value of a transfer lies as much in the documents as in the figure.
A share transfer lawyer in Paris, Maître Léa Scemama assists sellers and buyers at every stage of the transfer of shares, stock or business across France, from the letter of intent to final signing, including due diligence and the negotiation of warranties. See all our services in corporate law.
How we work
| When we act | What we do | What you receive |
|---|---|---|
| Before the letter of intent | Choosing between a share sale and a business sale, tax structuring of the deal | A reasoned options note, with the figures |
| Due diligence | Corporate housekeeping, key contracts, employment and tax position, pending disputes, security over assets | A due diligence report and its effect on the price and on the warranty |
| Negotiation | Sale agreement, conditions precedent, warranty over assets and liabilities, and security for that warranty | A warranty that can actually be called, or a controlled exposure if you are selling |
| Signature | Approval clauses, employee information, registration, formalities and publication | A sale that is enforceable and free of formal defect |
| Afterwards | Calling or defending the warranty, challenging the price, the seller's non-compete | Proceedings brought within the contractual deadlines |
Our billing arrangements are set out on our fees page.
Transfer of shares or of the business?
The first, often decisive, question is what is being sold. Transferring the shares means passing on the company with all its assets but also its liabilities, including hidden risks. Transferring the business means passing on only the operating assets, leaving the liabilities with the seller. Each route has its advantages, constraints and its own tax treatment.
| Share transfer | Sale of the business | |
|---|---|---|
| What is transferred | The whole company, assets and liabilities included | Only the operating assets: customers, trade name, lease, equipment |
| Fate of past liabilities | Taken over by the buyer, hence the central role of the warranty of assets and liabilities | Remain in principle with the seller |
| Buyer's main protection | The warranty of assets and liabilities, to be negotiated | The statutory regime itself: escrow of the price and clearance of oppositions |
| When the seller receives the price | On signing, subject to any negotiated escrow | Deferred, for the length of the statutory escrow |
| Registration duties | Depending on the type of company, set out below | On a progressive scale specific to businesses |
The firm helps you choose the deal structure best suited to your asset and tax objectives, and to measure all its consequences before committing.
Due diligence and upstream security
Before any signing, the legal audit allows the buyer to know what they are actually acquiring: regularity of meetings and corporate life, validity of key contracts (lease, commercial contracts, financing), employment and tax situation, existence of pending disputes or security over assets. This audit shapes the price, the negotiation and the warranty.
The firm also structures the pre-contractual phase: letter of intent, confidentiality agreement, memorandum of understanding and conditions precedent (obtaining financing, authorisations, approvals).
The warranty of assets and liabilities: the decisive clause
In a share transfer, the warranty of assets and liabilities is the buyer's central protection. It requires the seller to compensate the buyer if a liability originating before the sale emerges afterwards, or if an asset proves overvalued. Its scope, caps, duration and the financial guarantees attached to it (escrow, bank guarantee) are negotiated hard.
A poorly drafted warranty can prove ineffective when the buyer needs it most. The firm defends your interests, whether you are the seller (limiting your exposure) or the buyer (obtaining real and actionable cover).
The six parameters that give a warranty its value
A warranty of assets and liabilities is not judged by its existence but by the setting of six dials. That is where the negotiation happens.
| Parameter | What it sets | What is negotiated |
|---|---|---|
| Duration | The period during which a claim remains admissible | A duration aligned with tax and social security limitation periods for those risks, shorter for the others |
| Trigger threshold | The amount below which no claim is admissible | Its level, and whether it applies overall or per claim |
| Deductible | The share that remains permanently with the buyer | An absolute deductible, or a mere threshold that opens compensation from the first euro |
| Cap | The maximum compensation, expressed as a percentage of the price | Its level and the exceptions that escape it, tax and social security in particular |
| Guarantee of the warranty | What ensures the seller will pay | Escrow of part of the price or a bank guarantee, amount and gradual release |
| Notification period | The time the buyer has to report a claim | Its length and formalities, forfeiture being the usual sanction for delay |
Market benchmarks (orders of magnitude). No legal rule sets these parameters: they are negotiated. The ranges commonly seen in practice, to be adjusted to each deal, are as follows.
| Parameter | Commonly observed market range |
|---|---|
| Duration | Generally 18 to 24 months, up to 36 months; 12 to 18 months for ordinary commercial risks; a duration aligned with tax and social security limitation periods, around three years, for those risks |
| Trigger threshold | Around 1 to 2% of the sale price, below which no claim is admissible |
| Deductible | A few thousand euros per claim, often €3,000 to €5,000 for a small or medium-sized business |
| Cap | 10 to 30% of the price, often around one third, up to 50% or even 100% for the riskiest deals and fundamental warranties; tax and social security are sometimes uncapped |
| Guarantee of the warranty | Escrow of 5 to 15% of the price held for the warranty period, or a bank guarantee, released gradually |
| Notification period | 15 to 30 days from discovery of the triggering event, delay being sanctioned by forfeiture |
These orders of magnitude are indicative market benchmarks, not a scale: the right setting depends on the balance of power, the quality of the due diligence and the risks specific to the target.
Formalities, approval and tax
The transfer follows precise formalities whose breach can weaken it: approval procedure in SARLs and companies whose articles require it, prior information of employees in the businesses concerned, registration of the deed and payment of duties, publicity formalities for business transfers.
The rules on informing employees in advance changed on 27 July 2026.
| Situation | What applies from 27 July 2026 |
|---|---|
| Business with fewer than fifty employees | Each employee is informed individually, one month before the transfer |
| Business with fifty employees or more and a works council | The works council is informed and consulted |
| Breach | Civil fine capped at 0.5% of the price |
Finally, tax is decisive: registration duties, taxation of the seller's capital gain, exemption or deferral schemes. The firm coordinates these aspects, where appropriate with your accountant, to optimise the deal within a secure framework.
| Shares transferred | Registration duty |
|---|---|
| Shares in an SARL | 3% after an allowance |
| Shares in an SAS or SA | 0.1% |
| Shares in a real-estate-dominant company | 5% |
What the Commercial Code provides
In an SARL, a transfer to an outsider requires the consent of a majority of partners holding at least half of the shares, and the company's silence for three months counts as consent (article L. 223-14 of the Commercial Code). If consent is refused, the partners must buy or have the shares bought within three months, at a price set if necessary by an expert appointed under article 1843-4 of the Civil Code, with the expert's fees borne by the company. A partner who has held the shares for less than two years cannot rely on this buy-back mechanism, except on succession, division of marital property or a gift to a spouse, ascendant or descendant. Any clause to the contrary is deemed unwritten.
Signing the deed is not enough. The transfer must be in writing, then made enforceable against the company by service or by lodging an original at the registered office against a certificate from the manager. It becomes enforceable against third parties only after the amended articles are published at the trade and companies register (articles L. 223-17 and L. 221-14 of the Commercial Code).
Transfer litigation
After the sale, disputes most often concern the enforcement of the warranty, the discovery of defects in consent (fraud, fraudulent concealment of the company's real state), challenges to the price or breach of the seller's non-competition undertakings. The firm brings or defends such claims before the competent commercial court.
Why a lawyer for your transfer?
A successful transfer is prepared well before signing. The lawyer secures the deal end to end and connects it with the existing shareholders' agreement and, often, with the transfer of the commercial contracts and the commercial lease attached to the business.
Frequently asked questions
What is the difference between a share transfer and a business transfer?
A transfer of shares passes on the company itself, including all its liabilities. A business transfer only passes on the operating assets (goodwill, lease, equipment), without the company liabilities. The choice has major legal and tax consequences.
What is a warranty of assets and liabilities?
It is a clause by which the seller undertakes to compensate the buyer if a liability originating before the sale comes to light afterwards (tax reassessment, employment dispute, hidden debt). It is the essential protection for the buyer of a company.
Is approval required to transfer shares?
In an SARL, the transfer of shares to a third party is subject to the partners approval by the legal majority. In an SAS or SA, approval depends on the articles and the agreement. Failure to follow the approval procedure may void the transfer.
What registration duties apply to a transfer?
The transfer of SARL shares is subject to a 3% registration duty after allowance, that of SAS/SA shares to 0.1%, and the transfer of shares in property-dominant companies to 5%. This difference in tax treatment often influences the choice of structure and deal.
In the same area of law
- Shareholder disputes: the disputes that arise from the warranty of assets and liabilities.
- Restructuring and mergers: the alternative to a sale where the target has to be reorganised.
- Fundraising: the exit clauses negotiated as early as the first round.
Written by Maître Léa Scemama, admitted to the Paris Bar, Miraï Avocats. This page states the law applicable at its update date. It is general in nature and does not constitute advice tailored to a particular situation.