The contribution or transfer of a universality or branch of activity
1. Contribution of universality
The contribution of universality is the legal act whereby a company transfers its entire assets, both assets and liabilities, without being dissolved, to one or more existing or new companies for a consideration consisting exclusively of shares in the acquiring company or companies. A cash contribution is not permitted. It is a technique by which a company transforms itself from an operating company to a holding company. In other words, a company that has a lot of operational or industrial activities and pushes them down, as it were, to a subsidiary (whether or not a new subsidiary) in exchange for shares. This is the main difference with the merger and the classic demerger, where the shares in the acquiring company are allocated directly to the shareholders of the transferring or demerging company that ceases to exist. The transfer takes place by universal title, in a tax-friendly manner, but according to a mandatory procedure as stipulated in Section 12:92 WVV.
2. Contribution of branch of activity
Contribution of branch of activity is the legal act whereby a company, without being dissolved, transfers a branch of activity and the related assets and liabilities to another company for a consideration consisting solely of shares in the acquiring company. Also here is a cash contribution not permitted. A branch of activity is a group of companies that are technically and organisationally autonomous and can operate under their own steam. Everything that objectively belongs to the defined branch of activity must be transferred.
3. Transfer of a universality or branch of activity
A transfer of a universality or branch of activity is the operation whereby the parties choose to subject the transfer to the rules applicable to the contribution of a universality or branch of activity.