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published on 16 August 2024 | reading time approx. 4 minutes
The German Reorganization Tax Act (Umwandlungssteuergesetz - UmwStG) contains several lock-up period regulations, the violation of which can cause serious tax consequences. They must be observed, particularly in the context of M&A transactions. On the one hand, the violation can result in unwanted tax burdens at the level of the target company. On the other hand, a contributor may be subject to retroactive taxation with regard to the earlier contribution at a later point in time without any own action and without receiving any liquidity. Potential protections should be examined and considered in the SPA negotiations.
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Transaction advisory | Mergers & Acquisitions