Taking over an existing business has various advantages over setting up a new one from scratch.
The company’s new owner may, for example, maintain the existing market share and develop a simpler business plan based on existing information, thus avoiding administrative procedures. The new owner can also draw on the company’s past experience and on an established customer network, acquiring better overall knowledge of the business sector.
Before taking over a business it is important to ascertain its value and to get all the necessary information. For this purpose, it is possible to obtain title searches and financial statements of the company from the Italian Camere di Commercio.
Above all for transactions involving medium-to-large-sized companies, it is necessary to carry out careful due diligence, through which one can discover whether there are any outstanding tax liabilities and pending litigation (concerning tax and employment matters. For this purpose, it is also possible to request from the Agenzia delle Entrate a Tax Clearance Certificate. (under Article 14 of Italian Legislative Decree 472/97), through which one can check on pending contestations and those which have already been settled but whose liabilities are still outstanding.
Retiring business owners need to plan the transfer of their business in advance.
Some standard requirements to be completed when taking over a business are the same as when setting up a new business.
To take over a sole proprietorship, the new owner must obtain all permits and licenses which are necessary for the course of business. In some cases, these may be purchased from the previous owners (eg. taxi drivers and tobacconists). In other cases, a specific professional qualification or work experience is necessary (eg. hairdressers, beauticians).
In any case, the buyer takes over the economic activities of the assignor under a a new VAT number which should be requested from the Agenzia delle Entrate through the ComUnica procedure. The buyer will be able to register, using the same procedure, with the social security entity (INPS or membership registry) and eventually with the insurance entity (INAIL).
Before doing all this, it is necessary to request a new tax code from the Agenzia delle Entrate.
Concerning partnerships, if the takeover takes the form of the acquisition of a controlling interest (shares or stock) in the existing company, the recipient will continue to operate under the same company name using the same VAT number. However, in the case of the real acquisition of a company, the new owner will operate using a new VAT number.
The company transfer is formalized by a public deed drawn up by a notary, who then ensures that it is listed in the Business Register, while the transfer of shares or stocks can also be registered by qualified intermediaries (such as accountants) provided with a digital signature.