Frank Buitenwerf and Roos Jongeneel of Taxand Netherlands examine the main considerations of the tax clauses of a share purchase agreement under Dutch law. A sales contract is mainly concluded when you sell (or buy) products. In the sales contract, make sure that the product is clearly described and what it is suitable for. Most discussions in a sales contract usually occur when the parties declare the agreements reached independently of each other. All questions relating to the true intentions of the parties must be avoided. If you use the terms and conditions of sale or purchase, you must ensure that they are applicable. The general conditions of sale are generally insufficient. You should refer appropriately to these terms and conditions. This means that you must actively inform your contractual partner that you wish to validate your general terms and conditions of sale (exclusively) for the sales contract (and all future contracts). Whether it`s a machine, a production line, or another business, you should be aware of it in all situations. If you need full protection for the seller or buyer, take a hit at our seller-friendly SPA or spa. This often results in a negotiation process in which we can advise you. If the dispute ends in the Netherlands, we may defend on your behalf the cancellation or termination of the sales contract.

Simple Dutch law regulated the share purchase agreement (SPA) in Dutch between a single seller and a single buyer. The SPA contains balanced language to facilitate a “see where is” transaction such as.B. the sale of a troubled asset. In our daily practice in M&A tax matters, it is common for a share purchase agreement to be concluded under Dutch law for the acquisition of taxable Dutch companies, while not all parties involved are familiar with Dutch civil law or Dutch tax law. As a result, the parties may have an opposite view of the content and importance of the necessary tax clauses. In such a situation, it can be difficult to explain the necessity and impact of formulation in the negotiation process and shows that working with a standard model share purchase agreement (SPA) is neither sufficient nor effective. In addition, in the case of cross-border transactions, the amount of the tax compensation often varies according to the habit of both parties. Tax compensation may be included as an obligation to reimburse damages related to the infringement (in this case, the amount of damage must be determined first) or as an obligation to pay the historical tax debt, including, for example, penalties and interest.

Over the years, several nuances have been made to this criterion in the case law. Important circumstances affecting the interpretation of an SSS are, inter alia, whether a professional lawyer participated in the formulation of the text in a certain way and in which language the agreement was drafted. The interpretation of the terminology used, for example, in the English language and legal practice, may have an impact on the interpretation of such a clause by Dutch law. It often happens that the buyer and seller (too much) wait a long time before being advised by a lawyer on the transaction they wish to conclude.. . . .