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Is there any limit regarding the purchase and sale of company shares?

If you are thinking on selling shares in your company, below we highlight some of the most important information to bear in mind:


The transfer of corporate shares is included in our legal system in the Capital Companies Law, Articles 106 et seq.

These Articles, among other things, establish the obligation to carry out this operation before a Notary Public. From that moment on, the buyer of the shares is the new shareholder and, consequently, they can exercise their rights from that very moment.

If you are interested in transferring your shares to another shareholder, it is free and voluntary. It is also free and voluntary to transfer your shares to your spouse, ascendant or descendant, or to companies in the same group as the selling company, unless otherwise stated in the articles of association. Therefore, shareholders may carry out such commitment at any time without prior authorisation.

If the articles of association establish regulations regarding the transfer of shares, they must therefore comply with the provisions established therein because, in that case, they will be the ones who set the limits and govern the conduct of the transfer, but never the price of the shares.

Furthermore, the articles of association may not include clauses in which the member is obliged to transfer a different number of shares than they wish, because such a clause will be considered null and void. A clause that leaves the shares free to be transferred when they are transferred to third parties other than those indicated above shall also be null and void. Nor may they establish a clause in which the accounts auditor fixes the price of the transfer.

You may wish to transfer your shares to a third party, other than your spouse, ascendant, descendant or group company, in which case you must make a written communication to the company’s director informing them of your intention and indicating at least the following details of the operation:

  1. Number of shares you wish to transfer.
  2. Who the buyer will be.
  3. Price of the shares.
  4. Any other relevant circumstance, for example the type of shares being transferred, if there are various types.

Consequently, this transfer will be subject to the consent of the company, resolved at the General Meeting by ordinary majority. The company may only refuse if one or more shareholders or third parties intend to purchase all of said shares.

Shareholders who have attended the general meeting will have preference in the purchasing of said shares, this is known as the “shareholders’ pre-emptive right”.  If there are several parties willing to buy the shares, these will be distributed according to their shareholding in the company’s capital. The General Meeting may refuse permission to the shareholder if it is decided at said meeting that the company itself will purchase the shares.

In the cases in which the General Meeting’s consent is required, the public deed of sale must be granted within one month from the day of the communication by the company of the identity of the buyer(s).

If the shareholder who intends to transfer the shares was at the Meeting where the transfer was discussed, it will be understood that such shareholder has been notified; if the selling shareholder did not attend, the company must notify them of its decision through a Notary Public.

It could be the case that the shareholder notifies the company of their intention to sell their shares to a third party, as indicated by law, and that, however, they do not obtain a response from the company, since, in this case, if more than three months pass without a response, it will be understood as an acceptance.

Registration – Sole Shareholders:

One last commercial point. Normally, the sale of shares is not recorded in the Companies Registry, especially so that the price of the transfer does not have to be made public. In this way, it is usually said that registering the sale is not compulsory, but beware! It is compulsory to register the “Sole Shareholder”. This will mean that if the buyer is only one person, or if the seller is only one person (whether natural or legal), then it will be mandatory to file the deed with the Companies Registry of the corresponding registered address, since the loss of the sole shareholder (the person transferring was the sole shareholder), or the supervening sole shareholder (only one partner purchases), or the change of sole shareholder must be registered.

With regards to taxation:

It is important to take note of the taxation of the operation. In the case of the sale of shares by a natural person shareholder, a capital gain or loss may be generated by the difference between the sale value of the shares and the purchase value or book value of the shares.

The fact is that, for the Tax Authorities, the sale value of the shares may be very different from the value we give it in the public deed that we have mentioned must be signed, as the Tax Authorities have their own way of valuing the shares, depending on the profits of the last financial year or the average equity of the last three closed years.

Specifically, the Tax Authorities will take the greater of the two following as sales value:

  1. The value of the net equity corresponding to the securities transferred resulting from the balance sheet for the last financial year closed prior to the date on which the tax accrued.
  2. That resulting from capitalising the average results of the three financial years closed prior to the date on which the tax accrued at the rate of 20%. For this purpose, dividends distributed and allocations to reserves, excluding those for the regularisation or updating of balance sheets, will be computed as profits.

As you can see, the amounts have nothing to do with the price indicated in the deed, so, again, before carrying out any company sales operation we recommend seeking advice from experts in the field, since several laws must be taken into account to correctly perform the operations and not get any surprises at a later date.

With regards to the case of sale of shares by another company that is the owner of the company being transferred, it deserves to be dealt with in a different article, due to its complexity and casuistry.

036 Form:

It is also important to highlight a detail regarding the information to be provided to the Tax Authorities. Some people confuse the non-obligatory nature of registering the sale of shares in the Companies Registry with notifying the Tax Authorities.

The Tax Authorities must be notified of the transfer, and this must be done using a form numbered 036, attaching a copy of the deed of sale of the shares. Otherwise you risk receiving a penalty for failure to notify, which may well amount to 150 euros. Moreover, there is a period of one month to notify the transfer, and late notification also carries the same penalty.

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