Sale and Purchase of Business Shares

Are you selling your business share? Are you buying out a fellow member’s business share? Pay attention to the details — consult us!

The most common form of business association is the limited liability company (kft.). A limited liability company is a business association that starts with a registered capital made up of capital contributions of a specified amount, in which the members’ liability essentially extends only to the payment of their own capital contribution. The rights and obligations attached to the capital contributions are embodied in the business share, which is transferable and may therefore be assigned.

To protect the existing ownership structure within the company, the company’s instrument of constitution may grant the other members a right of first refusal on business share transfers in the event that a member wishes to transfer their business share to an outside third party. Following a business share transfer, the company’s data in the company register changes, which means that an application for the registration of the changed data must be submitted to the competent Court of Registration.

The business share transfer agreement referred to above does not have to be submitted to the competent Court of Registration during the change-registration procedure; however, the law specifies the annexes that are absolutely necessary for the registration of the change.

The law requires the buyer to declare that they are familiar with the company’s instrument of constitution and accept its provisions as binding on them, and that they have reviewed the company’s financial, asset and income data, pending matters, contracts and balance sheet.