Especially succession planning for family businesses and other business interests should not be limited to testamentary arrangements (such as a will). To safeguard all parties involved, it is usually expedient to adapt the partnership agreement to the specific requirements. Such provisions can, for example, ensure that the shareholding can only be passed on within the family. However, it may also make sense to anticipate the succession and transfer shareholdings to descendants in order to prepare them in good time for the challenges of practice. This does not necessarily mean that the previous partners (usually the parents) have to give up all rights. Safeguards are conceivable through a wide variety of structures (such as usufructuary rights and bans on encumbrances and alienation). In the area of real estate, transfers during one’s lifetime can also prove to be sensible and desirable. Particularly when it comes to the residence or agricultural areas, a special protection of the transferring persons is necessary.
In the area of company law, there are very different ways of responding to issues of business succession. In most cases, the transfers should also be secured by a waiver of inheritance and/or compulsory portions. By means of fruit participation rights in shares, sub-participation, structuring via family holding companies, variants via a GmbH & Co KG or a FlexCo, profit participation rights, syndicate agreements or interpositions of private foundations, it is possible to react sensibly to the challenges of practice. Through appropriate structuring, it is also possible to differentiate between rights of influence (power) and asset protection (distributions/grants).
Further information on the subject of private foundations can also be found at www.privatstiftung.info.