What is corporate succession?
Business succession means the succession of the new generation to the management of the company. A distinction must be made here as to whether agreements are made that only take effect after the testator’s death, i.e. by cause of death, or whether there is already a transfer during the testator’s lifetime.
What can a lawyer specializing in inheritance law do for me when it comes to business succession?
Business succession is a multifaceted field that does not only concern the question of how the business of the deceased is transferred to the children as heirs in case of inheritance. In business succession, the main objective should be to lay the foundations for the continued success of the company. This is where specialist knowledge is needed. A lawyer specializing in inheritance law in Frankfurt is always the right contact person, provided that he or she has specialized in business succession.
How can I find the right purchase price for a business succession in Frankfurt?
In the case of succession, the purchase price is understood to be the redemption sum of the company against the heirs of a community of heirs who do not enter into the contract. Determining this price is not always easy in the case of a business succession in Frankfurt, but our lawyers specialized in inheritance law will be pleased to help you. On the one hand, the purchase price must be high enough so that the heirs of a community of heirs not involved in the business receive fair compensation, but it must not be so high that the business gets into financial difficulties. Our lawyers specializing in inheritance law will be happy to advise you on the possibilities of determining the right purchase price for business succession in Frankfurt.
How long does a business succession in Frankfurt take?
Business succession is a growing process. Our lawyers specializing in inheritance law will be happy to support you in your business succession in Frankfurt. The legal contract is quickly found, but the individual adaptation and consideration of all circumstances relevant to the specific case takes time. The transfer of a company requires tact and years of experience in this field. Our attorneys specializing in inheritance law can offer this experience. Proper structuring requires – Accurate clarification of the facts, including knowledge of the existing statutes, – Knowledge of the legal situation (border area/inheritance law/commercial and company law), – Knowledge of the tax context, – Imagination and tact.
How can I find the right successor for the business succession in Frankfurt?
When selecting the right successor for the company, care must be taken to examine with sufficient distance and without prejudice the capacity and suitability of the persons in question – in the case of succession, the heirs of the community of heirs. There is no uniform formula for success. If no person or none of the heirs of the community of heirs is suitable to run the business, there also remains the option of the executor. Our attorneys specializing in inheritance law will also be happy to advise you comprehensively on this option.
What is the advantage of a business succession compared to a start-up?
Compared to a start-up, the transfer of the company as a whole has the advantage that certain processes and structures, know-how and business relationships are taken over without interruption, which can be an economic advantage in any case, regardless of whether it is passed on to the (future) heirs in the event of succession or during the lifetime of the deceased. Our lawyers specializing in inheritance law in Frankfurt will advise you on the exact advantages of a business succession in case of inheritance. However, you also have to take into account the tax law side of things. The hidden reserves of a company must always be taken into account. Our Frankfurt lawyers will help you with all legal questions.
How much does a business succession in Frankfurt cost?
The costs of business succession depend on the value of the company and the size of the company in this context. While a small craft business can expect costs of between 1,000 and 4,000 euros, costs of between 1 and 4 % of the value of the business may arise for the transfer. As a rule, this does not pose a liquidity problem for the company.
What is a lawyer for in business succession?
A lawyer should always be consulted if the transfer of the company involves more than a simple change of shareholders. In this case, it is often necessary to revise the articles of association and to provide certain values to the generation being transferred, insofar as the value of the company created by them is their pension. Even in the case of inheritance, i.e. the transfer only after the death of the testator, expert advice is always required. Our lawyers specialized in inheritance law can offer you this expertise in business succession in Frankfurt.
What are the main legal aspects of business succession?
The focal points of the regulation of business succession concern questions such as who is to take over the company, when and to what extent, i.e. in the case of inheritance: which heirs of a possible community of heirs are suitable. The focus should be on the economic success of the company. The countless possibilities of legal application remain always a unique construction tailored to individual needs. A central aspect is the question of at what point in time the transfer should take place, whether during life or only after death. Business succession planning is not only a matter of legal implementation. It also includes tax considerations, business analysis and psychological skills.
What should be included in the will in connection with business succession?
When drafting a will with regard to a company, it must always be ensured that the company law provisions of the articles of association take precedence over the company’s own provisions in the will. Therefore, the regulation of business succession begins with company law and can only be regulated individually insofar as these do not take effect. As attorneys specializing in inheritance law, we are also well aware of the complexities of company law.
Who accompanies business succession?
Business succession can and should be accompanied by an expert advisor in the field. A tax advisor alone will not do justice to this task. For this reason, it is recommended to consult a lawyer specialized in inheritance law for a business succession in Frankfurt.
How can I follow up my business succession?
Business succession always means making arrangements outside of the ongoing business. Once the decision has been made to pursue business succession, a “roadmap” should be drawn up together with a specialist advisor, by means of which an overview can be maintained.
How much are the possible claims for compulsory shares of the heirs that are not taken into account in the business succession?
The right to a compulsory share must always be taken into account in the case of a business succession. The right to the compulsory share may jeopardize the existence of the company, since the compulsory share is a monetary claim that becomes due in case of death. The compulsory portion is half of the legal portion of the estate (§ 2303 paragraph 1 sentence 2 BGB).
How can business succession in Frankfurt be optimally structured from a tax point of view?
An optimal tax structuring of business succession requires the participation of all heirs of a community of heirs in order to be able to take full advantage of the tax allowances granted by the legislator and to be able to reach binding agreements on possible rights to a compulsory share. Although business succession has primarily business and also civil law requirements, the tax assessment is not left out. However, the order is always clear: only what makes business sense, ensures long-term family peace and preserves the company should be the result of succession planning. Reversing priorities by considering taxation first usually leads to a bad outcome. In the literature motivated by business management, the tax aspect is often placed in the foreground, which can easily lead to a desire for tax-motivated actions.
How is business succession regulated?
The legal requirements for a business succession are limited. First of all, the rules of company law take precedence. In the absence of these, the following applies: In the case of a GbR, it would be dissolved by the death of a partner (§ 727 BGB). In the case of an oHG, the partner ceases to exist (§ 131 Paragraph 3 No. 1 HGB). In the case of a limited liability company, the same applies to the general partner (§ 161 Paragraph 2 BGB). If, on the other hand, the limited partner dies, the partnership continues with the heirs (§ 177 HGB). The statutory provisions are therefore only rudimentary and are usually waived for this reason. Our Frankfurt inheritance law lawyers will be happy to answer all your questions and advise you.
How can the bank help with the succession of my company?
Your own bank can offer solutions and should always be involved in the negotiations and consultations to obtain the decisive liquidity. Advice exclusively through the house bank should not be considered due to the lack of neutrality of interests.
How can business succession be properly regulated?
Successful business succession occurs when the decision of the person was the right one and the conditions of the legal framework for the transfer have ensured legal certainty. Once the decision has been made in favor of an individual or an heir of the community of heirs, only then will the regulation and implementation of the business succession be carried out by the appropriate advisors.
What are the risk factors for family businesses?
The risk factors for a family business can often only be identified by looking into the future. Which transferor or transferor can see the risk that the older, well-established successor in the company dies prematurely and is replaced by a descendant in the direct line who is a minor and is represented at the shareholders’ meeting by the divorced spouse or common-law partner until the age of majority. A fragmentation of shares also leads to the family’s influence in the company being reduced and lost altogether.
What does the ideal business succession or the ideal successor look like?
This question does not arise when looking for successors from within the family, whether they meet the requirements or not. If a suitable successor cannot be found from among the family members themselves, it is decisive in the search for a third party for the succession of the company that he or she has the necessary business knowledge and the necessary sensitivity to weigh up the interests of the company and the shareholders.
