Donation of shares of a civil business

Verified 09 September 2026 - Entreprendre Service Public / (Prime Minister)

The donation of shares consists for a partner (the donor) in transferring to a beneficiary (the donee) the rights he holds in the share capital of the company. This operation must comply with a number of steps and conditions.

Step-by-step approach

Where the donation is made to a heir apparent of the donor, it may take the form of a simple donation or of a donation-sharing.

They are both donations, i.e. transmissions during the donor's lifetime (unlike a legacy for example).

Warning  

A donation of shares must be made by deed notarial. It cannot therefore be granted by means of a manual donation.

Where possible, the donation-sharing includes certain advantages and particularities, in particular :

  • It constitutes an early division of the donor's estate, during his lifetime: the assets are thus allocated in advance. This limits possible conflicts linked to an indivision and facilitates the settlement of the estate upon the death of the donor
  • The attribution to the donee is final and may not be the subject of report when settling the donor's estate
  • It is a hybrid act comprising a donation and a sharing but this sharing is generally exempt from taxation (sharing rights). Only the donation is subject to the donation rights, thus allowing a fiscal economy.

Donation-sharing, however, involves some constraints :

  • It can only be granted for the benefit of heirs presumption the donor, or the children of such heirs
  • It is not possible to donate property undivided by means of a donation-sharing
  • It is preferable to make a donation-sharing egalitarianin which each heir-apparent of the donor (usually his or her children) receives property of equal value. For example, a person who does not receive the shares may receive a sum of money of the same amount.

When the donee is not presumptive heir, only simple donation is possible.

Example :

When a donor with two children gives his shares to a brother or an uncle, only the simple donation is possible. The children of the donor are indeed heirs presumption because they are online direct. As such, they have priority over online heirs collateral (brothers and sisters, uncles and aunts, nephews and nieces, cousins...).)

1Verification of the requirement for an approval

The rules vary depending on the status of the donee (partner, spouse, ascendant or descendant of the donor or third party to the business).

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Donation to an Associate

The donation of shares of a SC: titleContent to one of its partners is in principle subject to the approval rule.

However, it is permissible to provide in the statutes for specific arrangements of approval (e.g. special majority, or the possibility of entrusting the decision to approve only to the manager) or even a waiver total.

Donation to the spouse of a partner

The donation of shares of SC: titleContent to one spouse (i.e. the spouse of a partner) is in principle subject to the approval rule.

However, it is permissible to provide in the statutes for specific approval procedures (e.g. special majority, or the possibility of entrusting the decision to approve only to the manager) or even a waiver total.

Warning  

Entered into a civil partnership partners or cohabiting partners are not affected by these rules and are therefore considered third parties to the business (they must be approved).

In case of transfer to a ascending or descendant, this is in principle exemption from accreditation.

However, the statutes may make such transfer subject to the approval of the members.

Donation to an ascendant or descendant

The donation of shares of SC: titleContent to one ascending or descendant of the donor partner is exemption from accreditation.

It is nevertheless possible to provide in the statutes that these donations are subject to approval.

Donation to a third party

The donation of shares of SC: titleContent to a third party is subject toapproval of partners.

However, it is permissible to provide in the statutes for specific arrangements of approval (e.g. special majority, or the possibility of entrusting the decision to approve only to the manager).

2Notification of the donation project

The draft donation must be notified to the businesses (i.e. to his legal representative) and to each partner individually, or by meaning, or by LRAR: titleContent, either by delivery against receipt.

FYI  

If the articles of association stipulate that only the manager gives the approval, then the notification is sent only to the business.

This notification can be made by both the donor and the donee.

It shall also contain at least the following information:

  • Identity and address of the donee
  • Number of shares given

3Decision of the business

The decision on whether or not to approve may be given in accordance with various procedures specified in the statutes:

  • Either by unanimous agreement of the partners (according to the statutes, this agreement can be given in general meeting, by written consultation or directly in the deed of donation)
  • Either by a decision taken by a specified majority in the articles of association (this decision may be taken at a general meeting or by a written consultation of the members)
  • Either by the manager alone

In order to be valid, approval or refusal must comply with certain rules and conditions

Approval shall be granted

Approval must be given in clear, unambiguous terms and in a unconditional (partners may not make their approval conditional on any requirement).

Approval shall cover the total shares the donation of which is envisaged (unless the donor and the donee)

The approval decision must be preserved in order to be able to justify compliance with the approval procedure. In practice, it is generally observed in a minutes of general meeting or in the document noting the consultation of the partners.

Tacit approval

The transmission may also be considered as approved, where the business has not made known its decision within 6 months of notification. This is referred to as accreditation unspoken. The donor can then continue the donation as if the partners had formally approved it.

Approval is refused

The refusal of approval must be notified by LRAR to the donor.

In this situation, the partners must, within 6 months of the notification of the application for approval, buy back the shares or even simply submit an offer to buy by one or more partners, by an authorized third party or, with the agreement of the transferor, by the business itself (with a view to capital reduction. The securities are then redeemed to be canceled).

The statutes may provide for a different period which may range from 1 month to a maximum of 1 year.

The repurchase price shall be fixed by mutual agreement between the parties. In case of disagreement, it is determined by an expert.

If no redemption occurs within this period, the donor can make the donation initially envisaged.

Please note

Whether or not the approval is granted, the decision of the partners must be notified to the donor by LRAR: titleContent.

The deed of donation of the shares must be drawn up in the form authentic (by a notary), on pain of nullity.

The notarial deed must contain certain mandatory particulars :

  • Names of parties
  • Identity of the business
  • Number and designation of shares given (if numbered)
  • Value of shares
  • Details concerning the approval of partners

A donation of shares involves the transmission of a active, but also of a passive (this corresponds to the debts of the company). The donor thus assigns his rights but also his obligations.

In this context, it is possible to provide for contractual warranty clauses obliging the donor to guarantee the accuracy of all information provided during the donation. Such a clause commits it to compensate for any error that may have led to a decrease in the value of the shares given.

Please note

Even in case of transmission without price (a donation), the valuation of shares is an important parameter because it determines for example the amount of any donation rights.

Beneficiary of guarantee

Although a guarantee clause generally benefits the donee, it is not the only one who can benefit from it: 3 people can indeed claim compensation under a guarantee clause:

  • The donee
  • The business the securities of which are transferred (the business could thus act under this clause and deduct from its outcome the costs associated with any legal proceedings
  • One creditor business (for example, the guarantee clause may stipulate that compensation consists in paying the creditor directly if a debt was not included in the company accounts at the time of the donation).

Purpose of the guarantee

For example, the donor may provide a contractual guarantee that the declared assets or liabilities are accurate, that the claims identified as recoverable are accurate, or that the social security contributions due have been paid.

The warranty may cover all information concerning the company and which may have a impact on the valuation of securities transferred : parent company accounts, customers and suppliers, volume of payroll expenses, possible equity investments in other companies, ongoing litigation...

Guarantee of liabilities

In the event of the transfer of shares, the beneficiary bears a major risk. Indeed, a liability may arise that originates in an event whose cause is earlier the transfer (e.g. a fine related to a tax adjustment in progress at the time of the donation), and with the consequence that decrease the value of the securities received.

To be valid, a liability guarantee clause must meet all of the following conditions:

  • It cannot guarantee that debts (regardless of their origin, legal or contractual)
  • The secured debt must be prior to the transfer, or prior to the date on which the reference accounts were drawn up (those from which the value of the securities was contractually determined)
  • The debt must not be included in the accounts to which the donee has had access (even if the donee has been aware of the debt). However, it is possible to provide that the mere knowledge of a debt not entered in the accounts prevents the donee from activating the guarantee.
Asset Guarantee

Such a guarantee allows the donee to be compensated when the registered assets declared at the time of the donation were overvalued due to a cause earlier on transmission, if this error results in a decrease in the value of the securities received.

Examples include an asset that is incorrectly valued on the balance sheet, a rejection by the tax authorities (after the transfer), a tax credit entered in the business' accounts at the time of the donation, or any asset that is on the balance sheet but does not actually exist.

To be valid, the asset guarantee clause must relate to an asset of the business, and guarantee a decrease in assets whose origin is an event prior to the transfer.

Drafting of a guarantee clause

The drafting of the guarantee clause directly conditions its efficiency. The inclusion of certain information is strongly recommended, including the following:

  • Reference date : the date before which the cause of a decrease in the asset or an increase in the liability is considered to have occurred prior to the donation. This date is often the date of transmission, but not exclusively (for example, the parties may decide that the reference date is the date on which the parent company accounts allowing the valuation of the securities were drawn up).
  • Beneficiary of guarantee : the secured person may be the donee, the business or even a creditor
  • Duration of the clause: it may vary in practice between a few months or several years
  • Calculation compensation: the proportion of the decrease in liabilities or assets that the guarantor (the donor) undertakes to assume. This proportion may decrease over time
  • Floor amount guarantee: the amount of damage from which the guarantee may be invoked
  • Ceiling amount compensation: the maximum amount of compensation that the donor undertakes to pay. Beyond this amount, the damage is not covered by the guarantee clause
  • Implementing arrangements : this information specifies how the guarantee can be activated by its beneficiary (justification of the liability, methods of sending the claim for compensation...))

Transmission of guarantees in the event of a donation

In case of donation of shares, the donor has the possibility to transmit to the donee a guarantee of liabilities from which he was able to benefit under the terms of the initial deed of acquisition. This transmission is possible even if the initial act did not provide for this possibility.

The tax administration collects a tax when a donation is made: these are the registration fees (also called donation rights or free transfer tax).

Donation fees are in principle due by the beneficiary of the donation (the donee). However, the donor has the option to take them at his expense, without this additional advantage being considered for tax purposes as a gift.

The amount of these donation rights is determined by different parameters:

  1. Value of the donation
  2. Amount of contingent liabilities abatements to be deducted
  3. Tax rate of the donation

The amount of the allowance and the tax rate vary depending on the relationship between the donor and the donee. The tax rate also varies depending on the amount given.

Example :

A partner wishes to give his son corporate titles for a total value of €320,000.

In this situation:

  • The abatement of €100,000 applies. The taxable amount is therefore reduced to 320 000 - €100,000 = €220,000.
  • The tax rate shall be 20%.

The transfer duties therefore amount to 20% from €220,000, or €44,000.

Additional discounts may apply in 2 special cases :

Dutreil Pact

The transmission of family companies is facilitated by the Dutreil system, which entitles the partial exemption donation rights, up to 75% the value of the securities transferred.

In other words, only a quarter (25%) of the value of the company will be taken into account in calculating the amount of donation rights.

A Dutreil Pact may be concluded when the 4 cumulative conditions the following are combined:

  • Conclusion with one or more partners of a collective commitment to conservation securities, for a period of at least 2 years. We are talking about commitment unilateral of conservation when taken by a single partner. This commitment must be in progress at the date of transmission. In addition, it must cover at least 17% financial rights and 34% voting rights of the business.
  • Each beneficiary of the donation commits individually to keep the securities transmitted during 6 years. This period shall start to run from the date of expiry of the conservation commitment made by the donor.
  • One of the beneficiaries or one of the partners signing the conservation commitment (collective or unilateral) must practice in the business and for 3 years sound main activity (or a function of leader in the case of a business submittedIS: titleContent). This period shall start to run from the date of expiry of the conservation commitment made by the donor.
  • The company exercises a industrial, commercial, craft, liberal or agricultural activity. This condition must be met from the conclusion of the 2-year collective conservation commitment until the end of the 4-year individual conservation commitment by each of the beneficiaries.

The Dutreil device also benefits businesses holding animators whose main activity is active participation in the conduct of their group’s policy. On the other hand, companies that have as their object the management of movable or immovable assets (for example, SCI) are excluded of the device.

Please note

This advantage is combined with the legal allowance to which the recipient of the donation is entitled (the amount of this allowance depends on his relationship with the donor).

Early transmission

Where the donor has under 70 at the time of transmission, an additional reduction of 50% a transfer tax applies on the taxable portion of the gift. The application of this reduction is however only possible if the donee undertakes to keep a number of shares for a period of at least 2 years.

Example :

A 67-year-old partner wishes to give his son corporate titles for a total value of €320,000.

In this situation:

  • The abatement of €100,000 applies. The taxable amount is therefore reduced to 320 000 - €100,000 = €220,000.
  • The tax rate being fixed, in that situation, at 20%, transfer duties shall be €44,000 ( 20% from €220,000).

With the application of the reduction of 50%therefore, the fee payable is the sum of €22,000.

This reduction can be combined with any reductions and the benefits of the Dutreil Pact.

The donation of shares must be recognized by a authentic act. The act is null if this condition is not met.

The tax registration of the donation is therefore directly carried out by the notary to the competent tax authorities (registration tax department or land advertising and registration service).

It is also on this occasion that the notary pays the donation fees (if any) on behalf of his clients.

A donation of shares modifies the distribution of shares. This event may involve accordingly an amendment to the statutes.

Warning  

When the donation is made to a person already associated, the amendment of the statutes taking account of the new allocation shall not not required. This avoids all the procedure (general meeting...) as well as the costs associated with this formality (filing of the statutes at the registry...).)

This approach is broken down into 3 steps: consult and have the partners vote, draw up a record of decision and update statuses.

1Consult and vote the partners

In order to amend the articles of association, the decision must be taken by the members meeting in general assembly.

Please note

The statutes may authorize a statutory amendment to be made by means of a written consultation associates (i.e. a vote by post) or even a act establishing the consent of all partners.

The meeting must first be convened by the business manager.

Once the meeting is regularly convened, the decision to amend the statutes must be adopted according to the majority rules provided for by law or by the statutes.

In a SC: titleContent, the decision to amend the statutes must be voted on and approved in accordance with the procedure laid down by the statutes themselves. They shall determine the majority required to adopt the amendment to the Staff Regulations, whether it is a simple majority, by a majority of 2/3, 3/4 or any other majority determined in the articles of association.

They shall also specify, when a decision is taken at a meeting, the quorum necessary, i.e. the minimum number of associates present or represented allowing the deliberation to be validly adopted.

Where no indication is given in the statutes, theunanimous agreement of all partners is required.

Once the decision is adopted, it must be recorded in a minutes.

It is then appropriate to update statuses by replacing the old entries with those resulting from the shareholders’ decision.

2Write the minutes of decision

Decisions amending the statutes of a SC: titleContent shall be recorded in a minutes of general meeting (minutes of the AGM) (or in a written consultation PV if applicable). These minutes are then kept in the register of minutes of the business.

In the event of a GA (the most common case), the minutes must include the following information :

  • Date and place of meeting
  • Terms of convening
  • Agenda
  • Identity of the session chair
  • List of partners present or represented with the indication of the number of shares held by each
  • Documents and reports submitted to the Assembly
  • Summary of the discussions
  • Text of resolutions put to the vote (subjects on which decisions are to be taken)
  • Detailed results of votes
  • Mention of the articles of association concerned by the amendment and indication of their new wording
Temporarily one-person civil business

If the donation has the consequence of leaving only one partner within the business, it is not necessary to organize a meeting, nor to convene a meeting for a vote of the single partner.

FYI  

When the donation is granted to the last remaining partner within the business, the latter becomes single-person. If this situation is not regularized in 1 year delay, any interested party may then apply for dissolution business.

When a civil business is reduced to a single member, the modification of the statutes results from a unilateral decision of the sole shareholder, which must simply be established in writing.

This decision must be dated, signed and recorded in the register of decisions of the sole shareholder.

The unilateral decision of the sole shareholder shall include the following information :

  • Identity of the sole partner
  • Decision adopted
  • Mention of the articles of association concerned by the amendment and indication of their new wording

3Update statuses

Once the decision to amend the statutes has been adopted, the statuses must be updated to take into account the donation and the new distribution of shares between shareholders.

It is appropriate to edit item articles of association relating to the distribution of shares in order to indicate the identity of the members after the donation and the number of shares held by each.

Please note

The donation of shares does not change the amount of the share capital. Only the distribution of shares among the partners is updated.

Once the changes have been made, the updated statuses must be dated and certified as true to the original by the legal representative of the business.

Warning  

Amended statutes must be filed at the registry of the commercial court (regardless of the amendment to the statutes). This process is carried out via the company formalities window.

4Publish a legal ad in a legal ad medium, if necessary

The obligation to publish a legal announcement in a legal announcement medium (Shal) does not apply to all statutory amendments.

Only certain amendments imply such an obligation: this is the case, for example, of a change of manager, or a change of corporate purpose.

The notice is then published in a Shal: titleContent of the department of head office of the business.

Publication must be carried out within a period ofone month from the decision to amend the statutes.

The notice of publication shall contain the following items :

  • Reason or corporate name
  • Legal form
  • Share capital
  • Social object
  • Address of head office
  • Location and registration number at RCS: titleContent or at RNE: titleContent
  • Decision or minutes of the general meeting dated and signed
  • Description of the statutory changes subject to disclosure (e.g. change of manager, change of corporate object or corporate name). The donation of shares, in itself, does not have to be mentioned in the legal announcement.

FYI  

Once the publication is completed, a certificate of publication the notice of amendment shall be issued. This is one of the documents to be sent to the companies' formalities desk in the amendment file.

The donation of shares usually leads to a change in the beneficial ownership of the business. In this case, a amending declaration of beneficial owners must be deposited at the companies' formalities desk.

This declaration is mandatory when a natural person acquires or loses control of the business, or when his holding percentage exceeds the threshold of 25% capital or voting rights.

That is the case if the holding percentage changes :

Example :

Before the donation, Mr. X holds 20% and Ms Y 80%. After the donation of shares, Mr X holds 30% and Ms Y 70%.

The beneficial ownership statement needs to be updated as Mr. X's percentage of ownership has evolved and it is becoming beneficial owner.

A declaration of beneficial ownership may also be required when the holding percentages remain the same, but the persons holding the shares change :

Example :

Before the donation, Ms. Y holds 70% of capital and Mr X 30%. Ms Y gives all her shares to Mr Z, who now holds 70%, while Mr X retains 30%.

The beneficial ownership statement needs to be updated to replace Ms. Y with Mr. Z, without changing the ownership percentages.

After the signing of the deed of donation and the amendment of the statutes (if necessary, i.e. when the donation has led to a change of partners), the business must complete certain mandatory formalities allowing the donation to be made enforceable with regard to business but also with regard to third parties.

Opposability with respect to the business

Third-party effectiveness against the business allows, for example, the donee to assert his status as a member, and consequently to benefit from all the rights attached to it (voting rights, right to dividends...))

This third-party effectiveness can be achieved in several ways:

  • Either by means of a meaning by extra-judicial act of the donation to the business,
  • Either by having the donation accepted by the manager directly in theauthentic act
  • Either, where the statutes so provide, by a transfer to the registers of the business

Third-party effectiveness

This third-party effectiveness allows the donor to no longer be considered as a partner with regard to third parties. When it is effective against third parties, the donation allows, for example, the donor to no longer be liable for the debts of the business towards the creditors.

This third-party effectiveness is acquired when the following conditions are met:

  • The formalities of third-party effectiveness to the businesses have been carried out (meaning...))
  • The donation or the amended statutes have been deposited at the registry of the commercial court, via the company formalities window

The donation of shares (or amended statutes) must then be declared within a period ofone month at RCS: titleContent via the website of the company formalities office :

Window of company formalities

The file to be submitted must include the following supporting documents :

  • In the absence of a statutory amendment: an authentic copy of the deed of donation
  • In the event of a statutory amendment:
    • Copy of the minutes of the meeting which decided to amend the statutes
    • Copy of the statutes updated, dated and certified as true to the original by the legal representative
    • Certification of publication of the notice in a Legal Advertising Support (Shal) if necessary
    • Request for Amending Enrollment

Please note

Since May 6, 2026, no need to transmit the registered deed of donation in the change folder.

Once the formality has been recorded, theregistration certificate (excerpt RNE: titleContent or Kbis) will be updated with the identity of the new partners if necessary.

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