With the title ‘The succession of the family business’, on Thursday 12 May 2022 was held the second day organized by the Chair of the Family Business Bosch Aymerich of the International University of Catalonia (UIC Barcelona), the Catalan Association of Family Business (ASCEF) and the College of Economists of Catalonia.
Experts of recognized prestige passed through the headquarters of the latter entity, in order to analyze the challenges that await a business modality that accounts for 89% of all Spanish companies and that generates 59% of GDP and 67 % of employment.
The conference was presented by Carmen Jover, president of the Tax Commission and secretary of the Governing Board of the Col·legi d’Economistes de Catalunya, Jaume Alsina, secretary of the Board of Directors of the Catalan Business Association Familiar, and Dr. Jordi de Juan, director of the Bosch Aymerich Family Business Chair, the only one of the 37 chairs dedicated to this subject in Spain that, in addition to addressing economic analysis, is dedicated to investigating legal aspects.
The UIC Law School has also been a pioneer in incorporating a specific subject on Family Business Law into its program. The first table, dedicated to the challenges and risks of succession, was moderated by the notary Antoni Bosch Carrera and featured Dr. De Juan and Dr. Pilar Marquès, professor at the University of Girona. Both agreed to consider the transfer of this type of company as a process that should start with the creation of a “family protocol”, from which other documents will be born, such as marriage chapters or the succession agreement.
In family organizations, the change can be somewhat complex, since the founder is usually the “soul” of the project, and it is not easy to find a follower. This explains why only 30% of companies go to the second generation and 12% to the third. For De Juan, “all families have heirs, but the successor must be someone who knows the business thoroughly. The lawyer has to accompany the family in this process, seeking balance, managing expectations and also frustration”.
Marquès, for his part, pointed out that dialogue is a fundamental tool for reaching successful agreements, especially in the area of the Family Council. The second table, focused on the corporate governance of the family business, brought together Olga del Castillo, lawyer and partner of Corporate de Crowe, and Josep Maria Cervera, director of Corporate
Despite the importance of the latter, only 28% of family businesses have developed a succession plan; a fact that can determine its future viability. As Cervera points out, 60% of companies of this type close due to family problems. For this reason, it is necessary to create guidelines to ensure the succession of management and ownership, which address aspects such as the decision structure or the management of the business and talent portfolio.
The third table dealt with everything related to legal certainty and fiscal neutrality, combining the vision of law and economics, led by Ramon Santos Lloberas, lawyer and partner at Fiscal de Crowe, and Jordi Bertran, economist and partner at Bertran Ribera Asesores, with Dr. Jaume Menéndez, economist and member of the Governing Board of the Col·legi d’Economistes de Catalunya, as moderator.
Santos began by pointing out that, despite the fact that taxation should not be a key factor in a succession process, it usually has a great impact on many of these processes. He then examined the impact that taxes can have on companies of different sizes and proposed interesting succession planning measures. Bertran, for his part, pointed out the lack of synchrony between state law and the regulatory capacity of the Autonomous Communities, which has generated various administrative and jurisprudential interpretations.
The person in charge of the closing was Natàlia Caba, general director of Taxes of the Generalitat de Catalunya, who spoke about the succession agreements in the Inheritance and Donations Tax. In her intervention, she advocated considering inheritance processes as a single attributable event that occurs in two different phases, instead of as an accumulation of donations, as currently established by law.
Caba concluded the act by encouraging all those involved, Administration and representatives of the family business, to “join and coordinate efforts to enjoy greater legal certainty that allows the family business to continue to play a role of special relevance in our society”.
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