There are many reasons to sell a business today. Stéphanie Swiklinski, a notary graduate, sheds light on the specificities that govern business sales.
Should I go see my notary to sell my business?
Of course, your notary is qualified to give you the appropriate advice to sell your business and even to make the valuation in many cases. The drafting of the deed of sale of the business is also part of his duties. Contrary to popular belief, business sales are not reserved for lawyers and accountants. Sometimes it is even mentioned that "any deed of transfer of the right to lease must be done by authenticated deed". Authenticity means notary! In addition, it is important to know that imperative legal and fiscal rules apply to the promise to sell and the sale of a business. They are intended to protect not only the seller but also the seller's creditors (suppliers, staff, public treasury, etc.) as well as the buyer and his banker. It is therefore preferable, in many respects, to use the services of a legal professional such as your notary to ensure that your business transfer takes place under the best possible conditions.
Note that for this type of deed, if any information is missing, the deed and therefore the sale will be declared null and void!
What must the deed of sale of goodwill contain?
Before the law of July 19, 2019, it was important not to forget certain information in the deed of transfer of goodwill , otherwise the penalty was radical: nullity of the deed. The drafter of the deed was obliged to mention the origin of ownership of the business (creation or purchase, for example), whether the property was encumbered by liens or pledgesThe drafter of the deed was obliged to mention the origin of the property (creation or purchase for example), whether the property was encumbered by liens or pledges, the sales figures and commercial profits for the last 3 years, to relate the lease and its conditions (duration, lessor..) and above all the transfer price and its breakdown between tangible and intangible elements. Today, there is no longer any obligation as to the form of the deed and the compulsory mentions. Be careful, this does not mean that the seller is absolved of everything. He is bound by an obligation of information. The parties must also sign the accounting documents on the day of the final deed. This is the least they can do!
How soon does the seller receive the sale price?
This is not a real estate sale where the price can be paid into your account on the day of the final deed of sale. On average, the price is paid after 5 and a half months! The deed of sale is first registered with the tax authorities within one month. It must be published in a legal gazette within 15 days, then in the BODACC (official bulletin of civil and commercial announcements). These publications start the 10-day period during which the creditors can oppose the sale price if there are debts. Within 15 days of the publication in the JAL, the tax authorities have 60 days to claim the unpaid taxes. Finally, the buyer is jointly and severally liable with the seller for 3 months (under conditions 1 month) for the payment of the taxes due on the profits of the business made during the year of the sale. It will thus be necessary to be patient.
Stéphanie Swiklinski