Parties involved in transferring a business must follow specific rules. They differ according to the legal form of the company.
Types of business transfer
A business may be transferred against payment or free of charge.
Business transfers: a step-by-step guide
You must select the person who will take over the company (within the family or outside).
The time needed for a successful transfer may be relatively long. You are therefore advised to draw up a plan and a rigorous method.
Business transfers may impact on contracts in progress and lease contracts. Attention must be paid to this when taking over a business.
If you decide to transfer your company, you have to contact the representatives of the employees affected by the transfer and inform them of the date and reason for the transfer, its legal, economic and social consequences, as well as the planned measures that will affect them.
During a company takeover, the two parties must agree on the price, which is determined based on two fundamental concepts: asset value and return.
A conveyance contract must be drawn up as soon as you have decided to transfer the business and selected the buyer.
Taking over an existing company is a worthwhile alternative to setting up a new business.
The Centre de formalités (Chamber of Trades) and the Espace entreprises (Chamber of Commerce) provide help with formalities and administrative procedures.
The Guichet entreprises business portal provides several online forms.
Business transfer procedures
In order to sell or transfer a business, an entrepreneur has to complete a number of formalities:
- requesting annulment of the incorporation permit from the Ministry of Small Firms and Traders;
- cancelling registration for social security;
- sending a declaration of cessation to the Luxembourg Registry;
- requesting removal from the Trade and Companies Register (RCS);
- notifying the Direct Taxation Authority of the cessation of business.
The Cross-border Exchange for the Sale and Acquisition of Companies puts potential buyers and sellers in contact with each other.
The Chamber of Trades also offers a Companies Exchange which lists announcements classified by region, business area and company size.