What the deed must tell the buyer

A business bought for 180 000 € may carry a charge registered six years earlier. The deed of sale must state it, just as it must state the turnover of the last three financial years and the exact terms of the commercial lease.

What the business carries, and what stays outside

A business brings together tangible items — furniture, equipment and tools used in the trade — and intangible ones: clientele, trade name, sign, lease right, trademarks, patents and licences. The clientele is its fundamental element.

Some things do not come by default. The debts of the undertaking and the premises, where the seller owns them, stay outside the perimeter unless agreed otherwise. The parties may add them in, but they must put it in writing.

That boundary settles the negotiation. A buyer who believes they are acquiring the whole and discovers the premises stayed with the seller ends up the tenant of a landlord they did not choose, on the terms of the existing lease.

Buying a business is therefore not buying a company. Shares carry the whole estate, assets and liabilities alike; a business carries only the operating items listed in the deed. The choice between those two routes governs everything that follows.

Five particulars the deed must carry

• The origin of the business: identity of the predecessor, date and price at which the seller acquired it
• The turnover and operating result of the three financial years preceding the sale
• The schedule of charges granted to creditors over the ten years before the sale, or a statement that there are none
• The terms of the commercial lease: date, term, rent, renewal conditions, identity and address of the landlord

The fifth particular concerns the seller's personal situation: the spouse's consent is required where the seller is married under the community regime. Its absence weakens the deed, and the buyer has no way of putting it right alone.

The origin of the business serves more than curiosity. Comparing the price paid by the seller with the price now asked reveals any capital gain, and that gain weighs on the seller's tax position as much as on the conduct of the negotiation.

The turnover and operating result of the last three years form the backbone of the valuation. They read alongside the origin of the business: three declining years after a recent acquisition do not tell the same story as three steady ones.

The schedule of charges, by contrast, does not read as information: it reads as a burden. A charged business stays encumbered in the buyer's hands where the creditor is not paid out of the price, which is why the objection mechanism matters.

The municipality may step in first

The commercial pre-emption right lets the municipality take priority on the purchase, to preserve the diversity of trade within a perimeter set by a decision of the municipal council: a town centre, a district, sometimes a handful of streets.

Where the business lies inside that perimeter, the seller files a prior declaration with the town hall, stating the price and the terms of the intended sale. The mayor then has two months to exercise that right for the municipality.

Where it is exercised, two outcomes are possible. The municipality and the seller agree on a price, and the sale is concluded with it. Failing agreement, the procedure carries on without the intended buyer being able to predict its outcome.

The buyer therefore has every reason to ask the question early. Knowing whether the premises sit inside a trade-protection perimeter changes the calendar by two months, and that information is asked of the town hall before any advanced negotiation.