Protecting businesses
Without precautionary arrangements, the statutory matrimonial property regime of “sharing of accrued gains” may also include revenues of a company, even if not distributed during marriage. In the event of a divorce, this can lead to substantial equalization claims and liquidity pressure on your company. We protect business assets using a combination of matrimonial property law instruments such as prenuptial or postnuptial agreements, corporate law measures such as transfer restriction and preemptive purchase clauses, and—in the case of international structures—holding companies and trusts. To this end, we work closely with tax advisors, notaries, and family offices. The goal is to create a structure that ensures the company’s continued existence and operational capacity in the event of a separation, without infringing on the other spouse’s matrimonial property rights.
Company shares acquired or accumulated during the marriage are generally considered part of the marital property and are therefore subject to a 50-50 division in the event of a divorce. This applies not only to the shares themselves but often also to any increase in their value during the marriage if such increase is linked to undistributed revenues. Since company shares are generally illiquid, a claim for equalization under matrimonial property law in cash can tie up significant liquidity or force a sale. Holding structures are often spread across multiple companies and, in some cases, multiple countries, which renders valuation and allocation more complex.
Prenuptial or postnuptial agreement with allocation of marital property—company shares and any increase in their value are allocated to separate property or are completely excluded from the spouse’s share of marital gains.
Shareholder agreements – restriction-of-transfer clauses, preemptive rights, and consent requirements prevent shares from being transferred to outside third parties or the spouse in the event of a separation.
Holding structures – grouping operating companies under a holding company facilitates the allocation of assets under matrimonial property law and creates a clear separation between business and private assets.
Valuation clauses – contractually agreed-upon valuation methods provide clarity in the event of a separation and reduce the potential for disputes regarding the company’s value.
We assess on a case-by-case basis which combination of these instruments is best suited to your corporate structure, financial situation, and family circumstances. In cases with an international dimension, a trust or foundation structure is often considered suitable as an additional, independent instrument.
INTERNATIONAL HOLDING AND
ASSET STRUCTURES
For entrepreneurs with companies or investments in multiple countries, an additional question arises: which matrimonial property law and which corporate law actually apply? We determine the applicable legal framework, align the matrimonial property arrangements with the existing business structure, and work closely with our international network of partners in more than 80 countries. This is particularly relevant when a change of residence is planned or when equity interests are to be restructured.
HOW WE WORK
We specialize in the protection of corporate assets under family law and coordinate matters related to matrimonial property law, corporate law, and—in collaboration with our network—tax law. Our approach includes analyzing the existing corporate and asset structure, coordinating with tax advisors and family offices, drafting prenuptial agreements and shareholder agreements, and assisting with their notarization. Upon request, we periodically review existing structures, for example following a capital increase, a change in ownership, or a move abroad.
Without a prenuptial or postnuptial agreement, business shares and any increase in their value during the marriage may be considered marital property and are therefore subject to a 50-50 division. This can lead to substantial equalization claims that must be financed by the business itself.
No. A holding structure may render the allocation and valuation of equity interests more complex, but it does not replace a matrimonial property agreement. In addition, a prenuptial or postnuptial agreement is generally required.
A prenuptial or postnuptial agreement governs the relationship between spouses, while a shareholders’ agreement governs the relationship between shareholders. To ensure effective protection, we often use a combination of both instruments.
Trusts can provide a means of separation in appropriate, typically internationally oriented arrangements. Whether a trust structure is appropriate and legally sound depends on the specific case and the applicable legal system.
If a company is not listed on a public stock exchange, the valuation is conducted in accordance with recognized business valuation methods and can be specified in advance in an agreement to minimize disputes in the event of a separation. We work with specialized valuation experts for this purpose.
Generally, as early as possible—ideally before marriage or immediately upon establishing or acquiring the equity interest. However, a postnuptial agreement can also be entered into or amended during an existing marriage.
In this case, we first determine which matrimonial property regime applies and tailor the protective structure accordingly. A change of residence can alter the applicable legal system, which is why existing arrangements should always be reviewed in such cases.