Sale Of Business As A Going Concern Agreement for the Netherlands

Sale Of Business As A Going Concern Agreement Template for Netherlands

A comprehensive legal agreement governed by Dutch law that facilitates the transfer of an entire business operation as a going concern from one party to another. The document covers all aspects of the business transfer, including assets, liabilities, employees, contracts, intellectual property, and ongoing operations. It ensures compliance with Dutch legal requirements, particularly the Dutch Civil Code (Burgerlijk Wetboek), employment regulations, tax laws, and competition rules. The agreement includes detailed provisions for purchase price, completion mechanics, warranties, and post-completion obligations, while addressing specific Dutch legal considerations such as works council requirements and transfer of undertaking provisions.

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What is a Sale Of Business As A Going Concern Agreement?

The Sale Of Business As A Going Concern Agreement is a crucial document used in the Netherlands when transferring an operational business from one owner to another while maintaining its operational continuity. This comprehensive agreement is essential when the intention is to transfer all or substantially all of a business's assets, employees, contracts, and operational capabilities as a single functioning unit. The document is structured to comply with Dutch legal requirements, including the Dutch Civil Code, employment laws, tax regulations, and competition laws. It's particularly important for ensuring proper treatment of employee rights under Dutch transfer of undertaking regulations, VAT implications of going concern transfers, and works council consultation requirements. The agreement typically includes detailed provisions covering purchase price mechanisms, warranties, indemnities, and post-completion obligations, making it suitable for complex business transfers where operational continuity is paramount.

What sections should be included in a Sale Of Business As A Going Concern Agreement?

1. Parties: Identification of the Seller and Buyer, including full legal names, registration details, and addresses

2. Background: Context of the transaction, brief description of the business, and purpose of the agreement

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules of interpretation

4. Sale and Purchase: Core agreement to sell and purchase the business as a going concern

5. Purchase Price: Specification of the purchase price, payment terms, adjustments, and payment mechanics

6. Completion: Details of when and where completion will take place and what will happen at completion

7. Assets and Liabilities: Specification of assets and liabilities included in the sale

8. Employees: Treatment of employees, transfer of employment contracts, and related obligations

9. Warranties: Seller's warranties regarding the business, assets, liabilities, and operations

10. Tax Matters: Tax-related provisions, including allocations, indemnities, and VAT treatment

11. Seller's Restrictions: Non-compete and non-solicitation provisions

12. Confidentiality: Obligations regarding confidential information and announcements

13. Further Assurance: Obligations to execute further documents and take additional actions if needed

14. Notices: Process for giving formal notices under the agreement

15. General Provisions: Standard boilerplate clauses including governing law, jurisdiction, and entire agreement

16. Governing Law and Jurisdiction: Specification of Dutch law as governing law and jurisdiction for disputes

What sections are optional to include in a Sale Of Business As A Going Concern Agreement?

1. Intellectual Property: Detailed provisions for transfer of IP rights, when the business has significant IP assets

2. Real Estate: Provisions dealing with transfer or assignment of property leases, when applicable

3. Environmental Matters: Specific provisions for environmental liabilities and permits, necessary for businesses with environmental impacts

4. Data Protection: Specific provisions regarding transfer of personal data, required when significant personal data is involved

5. Pensions: Provisions dealing with pension schemes and obligations, needed when the business has pension arrangements

6. Earn-out Provisions: Structure for additional payments based on future performance, used when part of purchase price is contingent

7. Third Party Consents: Process for obtaining necessary third party consents, required when key contracts need consent for transfer

8. Transitional Services: Arrangements for post-completion services by seller, needed when business cannot operate independently immediately

What schedules should be included in a Sale Of Business As A Going Concern Agreement?

1. Schedule 1 - Assets: Detailed list of all assets included in the sale

2. Schedule 2 - Excluded Assets: List of assets specifically excluded from the sale

3. Schedule 3 - Properties: Details of owned or leased properties

4. Schedule 4 - Employees: List of transferring employees and their key employment terms

5. Schedule 5 - Material Contracts: List and copies of key business contracts

6. Schedule 6 - Intellectual Property: Details of all IP rights owned or used by the business

7. Schedule 7 - Warranties: Detailed warranties given by the seller

8. Schedule 8 - Completion Obligations: List of documents to be delivered and actions to be taken at completion

9. Schedule 9 - Permitted Encumbrances: List of permitted liens or encumbrances on assets

10. Appendix A - Completion Accounts: Format and principles for preparation of completion accounts

11. Appendix B - Tax Covenant: Detailed tax indemnity and related provisions

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Netherlands

Publisher

Genie AI

Document Type

Contract to Sell

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Manufacturing

Retail

Technology

Professional Services

Healthcare

Hospitality

Construction

Agriculture

Transport and Logistics

Energy

Financial Services

Real Estate

Education

Media and Entertainment

Relevant Teams

Legal

Finance

Corporate Development

Mergers & Acquisitions

Human Resources

Operations

Tax

Compliance

Risk Management

Business Development

Strategy

Relevant Roles

Chief Executive Officer

Chief Financial Officer

General Counsel

Corporate Lawyer

Financial Director

Commercial Director

Operations Director

Human Resources Director

Tax Director

Merger & Acquisition Manager

Business Development Manager

Company Secretary

Risk Manager

Compliance Officer

Finance Manager

Legal Counsel

Corporate Development Manager

Industries
Dutch Civil Code (Burgerlijk Wetboek): The fundamental law governing contracts, obligations, and property transfers in the Netherlands. Book 2 covers corporate entities, while Book 6 deals with general contract law provisions.
Dutch Transfer of Undertaking (Protection of Employment) Regulations (Wet overgang van onderneming): Implements EU Directive 2001/23/EC, protecting employees' rights during business transfers and ensuring automatic transfer of employment contracts.
Dutch Competition Act (Mededingingswet): Regulates merger control and competition aspects of business transfers, potentially requiring notification to the Authority for Consumers and Markets (ACM).
Dutch Value Added Tax Act (Wet op de omzetbelasting): Governs VAT treatment of business transfers, including special provisions for transfer of a going concern which may be exempt from VAT.
Dutch Corporate Income Tax Act (Wet op de vennootschapsbelasting): Regulates tax implications of business transfers, including potential fiscal unity break-ups and transfer pricing considerations.
Dutch Works Councils Act (Wet op de ondernemingsraden): Requires consultation with works councils for significant business decisions including transfers of business.
Dutch Environmental Management Act (Wet milieubeheer): Governs environmental permits and obligations that may need to be transferred as part of the business sale.
Dutch General Data Protection Regulation Implementation Act (Uitvoeringswet AVG): Implements GDPR requirements regarding transfer of personal data during business acquisitions.
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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