Transferring the shares of a French company: How does it work?

Transferring/selling your French company shares

Sometimes, a company will try to transfer or sell its shares, so that it can get some cash or bring in a new associate. However, there are certain things you should do to make sure that both the buyer and the seller are protected.

Pay attention to the company type and by-laws

Overall, it’s important to remember that the legal status of your company will have an impact on how you can transfer shares. Generally speaking, there are more obligations when transferring shares in an SARL than in an SAS.

However, even in an SAS, transferring shares can be subject to certain obligations! As such, you need to make sure that you follow all the clauses that were defined in the by-laws of your company!

In a similar fashion, it’s also important to see if there is an associate’s pact. This pact can define certain clauses when transferring shares, so if you don’t respect them, associates or shareholders will be able to call the transfer into question.

Make sure the price of the transfer is reasonable

If you just want to bring in a new associate, you might be thinking that you should outright give your shares for free, or sell them for 1 euro. However, the judge might then refuse this transaction, so it’s important to give a reasonable price.
As such, having an expert determine the price of these shares can be necessary in some cases.

Keep in mind; you might also have to pay taxes on this transaction!