Share transfer or capital increase
In a transfer, a partner sells all or some of their shares to someone else: another partner or a newcomer. The company does not change, and neither does its capital. What changes is who holds the shares, and the price goes to the seller (the transferor), not to the company. If you want the new partner's money to go into the company, you need a capital increase instead.
| Share transfer | Capital increase | |
|---|---|---|
| Who receives the money | The selling partner | The company |
| Share capital | Unchanged | Increased |
| Number of shares | Unchanged | Increased |
| Partners' decision | Approval if the buyer is a third party (art. 571) | Amendment of the articles by three quarters (art. 586) |
| Deed | Authentic deed of transfer | Deed amending the articles |
Approval: when the partners must say yes
A SARL is a closed company: partners choose who they go into business with. The Commercial Code therefore gives them a say over the arrival of an outsider.
- 1
Notify the plan
The seller sends the company and each partner the plan: who is buying, how many shares, at what price and on what terms.
- 2
Have the partners decide
The partners decide whether to approve the buyer. The decision is recorded in minutes.
- 3
If approval is given
The transfer can be signed before the notary on the terms notified.
- 4
If approval is refused
The partners have three months from the refusal to buy the shares or have them bought, at a price set by an approved expert. This period can be extended once, without exceeding six months.
The form: an authentic deed before a notary
In practice, the transfer is signed before the notary. The deed identifies the seller and the buyer, the number of shares, the price and its payment, and refers to the approval decision. The notary has the deed registered and collects the registration duty. For the company and third parties to have to take the transfer into account, it must then be served on the company, or accepted by it in an authentic deed, often in the same deed with the manager taking part.
Price, registration duty and capital gain
The price is freely agreed between seller and buyer, except when approval is refused, in which case it is set by an approved expert. To estimate it, you look at what the company is worth: its assets less its debts, its results, its customer base. A value you can justify protects both parties, including towards the tax authorities.
After signing: articles, BOAL, register
The articles show how the shares are split among partners: after the transfer, they are no longer accurate. The notary prepares the update and the notice of amended details for the BOAL. You then file the amendment request with the CNRC, with the amended articles and the published notice. Finally, if the people who own or control the company change, a new beneficial owners declaration is due to the CNRC within a month.
| Item | Amount |
|---|---|
| Registration duty on the transfer | 2.5% of the price according to the DGI tax guide, to be confirmed |
| Notary's fees | Depends on the notary: ask for a quote |
| BOAL notice | Publication rate |
| CNRC amendment (company, without capital increase) | About 4,032 DA at least, under the CNRC fee schedule |
If the manager or the majority changes
- The seller was the manager: appoint the new manager by a partners' decision, and have the trade register amended at the same time as the transfer.
- The manager's social security situation may change: a majority manager pays into CASNOS, a paid minority or non-partner manager falls under CNAS.
- The bank must know the new people authorised to sign.
- In an EURL, transferring some shares brings in a second partner: the company becomes a SARL. Conversely, if one partner buys all the shares of a SARL, it becomes an EURL.
Worked example (fictitious)
SARL Atlas Conseil (example) has capital of 100,000 DA divided into 100 shares of 1,000 DA: A holds 60, B holds 40. B sells all 40 shares to D, who is outside the company, at 1,500 DA per share, or 60,000 DA. B notifies the plan to the company and to A, and the partners approve D.
| Before | After | |
|---|---|---|
| Capital | 100,000 DA | 100,000 DA (unchanged) |
| A | 60 shares (60%) | 60 shares (60%) |
| B | 40 shares (40%) | 0 shares, B leaves the company |
| D | 0 shares | 40 shares (40%) |
| Price paid by D to B | 60,000 DA | |
| Registration duty at 2.5% (indicative) | 1,500 DA |
The company receives nothing: the 60,000 DA goes to B. As D holds 40% of the capital, the beneficial owners declaration must be updated within a month.
Common mistakes
- Signing a private transfer agreement without a notary: the law requires an authentic deed.
- Collecting the price before the partners have approved.
- Forgetting to notify the plan to each partner.
- Stopping at the transfer deed, without updating the articles or the trade register.
- Forgetting the beneficial owners declaration within a month.
- Leaving the former partner-manager on the register and authorised at the bank.
Two ways to get it done
This guide is all you need to do it yourself. Neuron does not do bookkeeping or routine tax and social returns; we can, however, provide your registered address.
1I do it myself
The free guide
Everything you need is on this page: documents, deadlines, a filled-in example.
Free
Follow the guide2An address for your head office
Domiciliation in Dely Brahim
Your registered office in Algiers, with a 1 or 2 year notarised contract and your mail received.
6,000 DA/ month
Register my company