Before acquiring or transferring a business in Spain, identify the exact legal structure. Obligations differ according to contracts, shares, assets, premises and the people involved. This guide outlines issues to discuss with qualified advisers.
Practical example
With a share deal, historical liabilities may remain within the company; in an asset deal the exact transferred perimeter must be defined.
What to check before moving forward
Buying company shares
When purchasing company shares, the legal entity generally keeps its contracts, assets and obligations; ownership changes. Review the company's history, not merely its current operations.
Equipment and assets
Check ownership, condition and realistic value of equipment, property and other assets. Separate operationally essential items from extras, and investigate liens or financing arrangements.
Debts and liabilities
Distinguish liabilities that remain within a company from those that may arise in an asset or business transfer. Contractual risk allocation does not automatically extinguish legal duties owed to third parties.
Tax considerations
Tax treatment depends on the seller, the assets or shares transferred and the transaction structure. Do not assume a general VAT, income-tax or corporation-tax result without case-specific review.
Continuity of contracts
Review important contracts, including expiry, change-of-control and assignment provisions. Continuing a customer, supplier or lease relationship may depend on specific contractual terms.
How to use this guide
Start by requesting sources for each important claim and noting what remains unverified. Cross-check answers against records, visit the operation where appropriate and bring material risks to an adviser before committing. Never fill missing financial figures with your own assumptions.
Evidence worth requesting before you proceed
A sales description is a starting point, not proof. These documents help distinguish verifiable facts from expectations:
- Corporate records and ownership evidence
- List of equipment, assets and encumbrances
- Outstanding debt and repayment schedule
Request information appropriate to the negotiation stage and respect confidentiality arrangements. Sensitive documents may be shared only after a buyer is identified.
Final takeaway
A sound transaction starts by defining what changes hands, checking the facts and documenting the agreement. Use this guide as a map of questions, not a replacement for a review tailored to the actual business.
General information only; not personalised legal, tax or financial advice. Rules depend on the transaction and may change.