Transfer of company shares: What you need to know

The transfer of company shares in Italy.

The transfer of company shares is a right that belongs to the shareholder if he no longer intends to be part of the shareholder structure, either partially or in its entirety.

The articles of association of the company can regulate the methods of transferring shares.

The transfer of company shares in Italy usually takes place after paying the price and signing a proper sales contract.

Limits and prohibitions.

Before deciding whether to buy or sell your shares, you should carry out checks to ensure that there are no restrictions or prohibitions on them.

It is advisable to check:

1. If the statute does not limit the possibility of circulating shares. (E.g. there is a pre-emption clause);
2. There is no legal or statutory prohibition to transferring the shares;
3. That the share is fully paid up, namely, that the transferor has fully paid their contribution at the time the company was incorporated;
4. If the share is subject to a lien, mortgage or other rights such as usufruct;
5. If there are particular rights provided for by the statute that not always can they be transferred to whoever buys the share.

How to transfer shares in Italy with a Shares Purchase Agreement.

The parties can choose to transfer the company shares in different ways:

a) By drafting a private share purchase agreement (Contract for the transfer of shareholdings) to be authenticated by the notary;

b) By means of an actual notarial deed having the form of a public deed;

c) Using the assistance of a qualified accountant by signing the deed with a digital signature.

Most of the time, it is convenient to stipulate a preliminary contract for the sale of company shares, with the assistance of a lawyer, in cases, for instance, where there is a need to negotiate or investigate the characteristics of the shares.

The deed concluded according to the forms provided for by the law will then be registered with the Register of Companies so that third parties can be notified of the transfer.

The Italian tax and fiscal aspects of the sale of shares.

The Shares Purchase Agreement must be registered within 20 days with the Revenue Agency. The registration tax is set at a fixed amount of Euro 200 for each transfer envisaged in the deed.

The transfer is also subject to stamp duty for the electronic registration of the deed.

From a fiscal point of view, the share sale can create a capital gain (positive difference between the purchase value and the sale value) or capital loss if this difference is negative.

In the event of a capital gain, the sale should be taxed in the following ways:

• sale by natural persons, a 26% rate will be applied on the capital gain received;

• in case of sale by legal persons (companies or persons carrying out business activities) a variable rate from 5% to 49.72% will be applied.

Other transfer operations on shares.

The deed of transfer of company shares can also take place using a donation.

The donation of shares follows the procedure described above, with the only difference being that the transfer must take place by public deed.

Also, in the event of the shareholder’s death, the shares may be transferred to their heirs, subject to any limitations provided for by the statute.

In this case, the heir of the deceased shareholder inherits the same position in the company as the original shareholder.

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