Transfer of Shares (SARL) or Stock (SA) in Morocco: Understanding the Rules and Formalities

The transfer of shares in a Limited Liability Company (SARL) or stock in a Public Limited Company (SA) in Morocco represents a crucial step in a company's life. These operations, while similar in their objective of transferring ownership, are subject to distinct legal frameworks and formalities. Understanding these differences is essential for anyone looking to transfer or acquire corporate securities.

Transfer of Shares in SARL in Morocco

The transfer of shares in an SARL involves the transfer of ownership of shares from one partner to another, whether an existing partner or a third party. In Morocco, this operation is primarily governed by articles 56 to 60 of Law No. 5-96 on SARLs. It requires a structured procedure to ensure the company's stability and the protection of its partners.

Mandatory Formalities for SARL Share Transfer

To be valid, any SARL share transfer must comply with several key steps:

• Deed of Transfer: The transaction must be formalized by a written deed, which can be authentic (notarized) or private. This deed must clearly state the identity of the transferor and transferee, the number of shares transferred, their unit price, and the total price.
• Partner Approval: A fundamental condition is obtaining the approval of the other partners. This decision is generally made during an extraordinary general meeting (EGM). For personalized advice on these procedures, feel free to consult our Legal Advice & Dispute Resolution services.
• Statutory Update: Following the transfer and approval, the company's articles of association must be updated to reflect the new capital distribution and the identity of the partners. This process is part of our Statutory Modifications services.
• Tax Registration: The deed of transfer, accompanied by the EGM minutes confirming approval, must be registered with the Tax Administration.
• Filing with the Commercial Court: The registered deed and updated articles of association are then filed with the clerk of the competent commercial court.
• Legal Publication: Finally, a notice of the transfer must be published in the Official Bulletin and a Legal Announcements Journal, making the operation enforceable against third parties.

It is crucial to note that failure to comply with these formalities may result in the nullity of the transaction.

Transfer to a Third Party: Enhanced Approval Procedure

The transfer of shares to an external party of the SARL is subject to a strict approval procedure. It requires the consent of the majority of partners representing at least three-quarters of the share capital. This procedure unfolds in several phases:

• Project Notification: The transferor must notify their transfer project to the other partners by registered letter with acknowledgment of receipt.
• Partner Deliberation: An ordinary general meeting (OGM) is convened to rule on the approval of the proposed transferee. Partners have a 30-day period to approve or refuse the transfer.
• Holding an EGM: In case of acceptance, an extraordinary general meeting is necessary to validate the transfer and proceed with the Statutory Modifications.

Transfer between Partners, Spouses, Ascendants, or Descendants

Share transfers between partners are generally free, unless otherwise stipulated in the company's articles of association which might require approval. Similarly, transfers by succession and transfers between spouses, relatives, and allies up to the second degree inclusive are free, unless the articles of association expressly provide for a prior approval clause. The taxation of these transfers must also be taken into account, potentially involving Corporate Tax (IS) or Income Tax (IR) for the transferor. For optimized tax management, our accounting services can assist you.

Transfer of Stock in SA in Morocco

In a Public Limited Company (SA), the transfer of stock is in principle more flexible than that of SARL shares. Law 17-95 relating to public limited companies provides for the free transferability of shares. However, this freedom is not absolute, and the company's articles of association may impose restrictions.

Conditions and Restrictive Statutory Clauses

Although stock transfer is generally free, it is highly recommended to establish a written deed of transfer, even if the law does not formally require it. An SA's articles of association may include clauses limiting this freedom, such as:

• Approval Clause: This clause subordinates the transfer of shares to the prior approval of other shareholders or the board of directors. The notification and response procedure is similar to that of the SARL. In case of refusal, the company is often obliged to have the shares acquired by a shareholder, a third party, or itself with the transferor's agreement.
• Inalienability Clause: This clause prohibits the transfer of shares for a determined period, which must be time-limited.
• Pre-emption Clause: This clause grants existing shareholders a priority right to acquire the shares offered for sale before they are proposed to third parties.

Non-compliance with these statutory clauses may result in the nullity of the transfer. After obtaining the necessary approvals, if applicable, the deed of transfer must be registered with the tax administration.

Conclusion

The transfer of corporate securities in Morocco differs significantly between SARL and SA. While the SARL emphasizes the intuitu personae nature and rigorously regulates the entry of new partners via approval procedures, the SA favors the free transferability of shares, subject to specific statutory clauses. A thorough understanding of these mechanisms is essential to secure your operations and ensure legal compliance. For any questions or assistance in your procedures, the iHub team is at your disposal to guide you.