What is the difference between takeover trading business or takeover shares?

When acquiring a business through Overnamemarkt, it's crucial to understand the difference between the transfer of shares or the acquisition of a business from a tax perspective:

• The transfer of shares is exempt from capital gains tax for the shareholders.
• The capital gain on the sale of a business is subject to corporate tax, and when the funds are distributed to the shareholders, a liquidation tax applies.

For more information on tax aspects, read: Transferring a business or shares, what's the situation?

Differences between shares transfer and business transfer

It's useful to clarify the distinction between these forms of business acquisition via Overnamemarkt, especially regarding the transfer of rights and obligations.

• With the transfer of shares, all assets and liabilities of the company are transferred, including all rights and obligations.
• With the acquisition of a business via Overnamemarkt, you only take over specific assets; outstanding claims and debts are generally not transferred. Permits need to be reapplied for and a new VAT number is required.

Elements transferred in a business acquisition

In the transfer of a business via Overnamemarkt, the following elements are typically transferred:

• The customer base
• The trade name
• The logo
• The phone, website, and domain name
• Equipment, inventory, and supplies
• The ongoing commercial lease

This can be done with a simple private agreement (without a notary) via Overnamemarkt. For property transfer of a business building, an authentic deed from a notary is always required.

Debts and liability

Debts are typically not transferred in a business acquisition via Overnamemarkt. Secured debts like mortgages are repaid with the proceeds from the sale of the mortgaged property. The notary oversees this.

Banks with the "Business Pledge" privilege will only agree to the transfer of the business after their outstanding credits are repaid.

Tip: Request proof of release of the "Business Pledge" registration via Overnamemarkt.

Possible (para)fiscal debts

To avoid being held liable for existing (para)fiscal debts of the transferor through Overnamemarkt, it is important that the transferor timely requests specific certificates:

1. Certificate of no tax debts (from the tax collector - Article 442bis WIB92; federal tax)
2. Certificate of no VAT debts (from the VAT collector - Article 93undecies WBTW)
3. Certificate of no social security debts related to personnel (from the social security office - Article 41quinquies RSZ law of June 27, 1969)
4. Certificate of no outstanding social contributions as a self-employed person (from your social insurance fund - Article 16ter KB nr. 38 of June 27, 1967)
5. Certificate of no outstanding tax debts with the Flemish Tax Administration (Article 3.12.1.0.14 Flemish Codex on Taxation)

Failing to obtain these certificates can have serious consequences:

The government seeks to protect itself as a creditor against a transferor who transfers their business through Overnamemarkt without paying (outstanding) fiscal and social debts.

“The acquirer is jointly liable with the transferor for the fiscal and social security debts of the transferor unless the acquirer safeguards themselves through the enforceability of the transfer agreement and specific certificates from five government agencies within strict deadlines.”

Risks with shares transfer

When transferring shares, you not only take over the shares (ownership titles) but also all the obligations of the company, known and unknown.

The buyer of shares assumes all past risks: Therefore, include a clause in the sales agreement that the buyer can hold the seller liable for incidents occurring after the transfer but related to the period before the transfer.

For a practical approach to covering yourself as a buyer of shares, read this article: Ensure enough securities when acquiring shares! 3 concrete tips by Bruno Vervisch, acquisition advisor.

In summary:

• In a shares transfer, you take over all assets and liabilities: the company continues its activities retaining customer claims and supplier debts; bank credits remain.
• Any incidents prior to the transfer remain the responsibility of the company (or the buyer/new shareholder). For example, tax or VAT reassessments for previous fiscal years, and claims from customers, suppliers, or personnel.
• In a business transfer, you only take over assets needed to run the business via Overnamemarkt. Unless otherwise agreed, you do not take over the business’s debts and claims. Ongoing contracts necessary for the continuation of business activities can be transferred, subject to the agreement of the involved third parties.