English-speaking Share Purchase Agreement solicitors in Spain

What is a Share Purchase Agreement

A Share Purchase Agreement is the contract that records the sale and purchase of shares in a company. By acquiring shares, the buyer takes ownership of the company itself, including its assets, contracts and existing liabilities. This makes a share purchase fundamentally different from an asset acquisition, as the buyer steps into the company as it stands at completion.

Because of this, the agreement must deal with more than just price and payment. It needs to set out what the seller is confirming about the company, how risks are shared between the parties and what remedies are available if issues arise after completion. Matters such as historic liabilities, tax exposure, and ongoing contractual obligations are addressed in the agreement.

A well-drafted Share Purchase Agreement clarifies what is being acquired and limits the scope for future disputes. Our English-speaking solicitors ensure that each agreement is clear, accurate and tailored to the specific transaction, reflecting the commercial reality of the deal rather than relying on generic or overly broad wording.

Key legal considerations in a share purchase

No two share purchases are ever the same. Even where the structure looks straightforward on paper, the detail often reveals issues that can affect value, timing or risk. This is why early legal input is important. Many of the most serious problems we see arise not because a deal was poorly intentioned, but because certain issues were not identified or properly dealt with at the outset.

A Share Purchase Agreement is not just a record of what has been agreed commercially. It’s the document that determines who carries responsibility if something later goes wrong. Careful drafting and thorough review at each stage of the process can make a significant difference to the outcome.

Due diligence

Before committing to a share purchase, it’s essential to understand exactly what you are acquiring. Legal due diligence involves a detailed review of the company, including its corporate structure, constitutional documents, key contracts, employment arrangements, regulatory compliance and any ongoing disputes. We also look closely at areas such as tax exposure, financing arrangements and guarantees that may not be immediately obvious.

For buyers, this process helps identify risks that may affect price or require specific contractual protection. For sellers, it highlights issues that may need to be addressed before completion in order to avoid delays or renegotiation later on.

Representations and warranties

Representations and warranties are one of the most important parts of a Share Purchase Agreement. They are the formal statements the seller makes about the company’s position, covering matters such as ownership of shares, accuracy of financial information, compliance with law and the absence of undisclosed liabilities.

If these statements turn out to be incorrect, they can give rise to claims after completion. We focus on ensuring that warranties are appropriate for the transaction, clearly drafted and supported by proper disclosure, so that expectations are aligned and the risk of future disputes is reduced.

Allocation of risk and liability

In a share purchase, the buyer takes over the company with all its historic liabilities. The agreement must therefore clearly define how risk is allocated between the parties. This includes responsibility for pre-completion tax matters, unresolved legal claims, regulatory issues and any other known or potential liabilities.

We advise on the use of indemnities where specific risks have been identified, and on limitations to liability, time limits and financial caps, so that both parties have certainty as to their exposure after completion.

Conditions, approvals and completion mechanics

Many share purchases are subject to conditions that must be satisfied before completion can take place. These may include shareholder approvals, third-party consents, regulatory authorisations or refinancing arrangements. Managing these conditions properly is essential to keeping the transaction on track.

We oversee the completion process in detail, ensuring that all documents are signed correctly, shares are transferred in accordance with Spanish company law, and statutory records are updated. This attention to process helps avoid technical issues that can cause problems long after the deal has closed.

What a Share Purchase Agreement should cover

A Share Purchase Agreement is the legal foundation of a share transaction. It sets out the terms on which the shares are sold and purchased and clarifies the rights and obligations of both parties. A well-drafted agreement helps avoid misunderstandings and provides a clear framework for dealing with issues that may arise during or after completion.

• Purchase price and payment terms – this specifies the agreed purchase price for the shares, how payment will be made and when it is due. It may also include provisions for deferred payments or adjustments where appropriate.
• Transfer of shares – these provisions set out the process for transferring ownership of the shares from the seller to the buyer, and ensuring that the company’s records are updated correctly.
• Representations and warranties – both parties provide statements about the company, including its financial position, legal status and ownership of the shares. These provisions help protect against undisclosed issues.
• Covenants – covenants outline specific obligations that the buyer and seller must comply with, both during the transaction and, in some cases, after completion.
• Conditions precedent – these identify the conditions that must be satisfied before the transaction can be completed, such as regulatory approvals or third-party consents.
• Indemnification – indemnity provisions set out responsibility for specific types of loss or liability that may arise after completion.
• Confidentiality – confidentiality clauses protect sensitive information shared during the transaction.
• Dispute resolution – these provisions establish how disputes will be handled if they arise, providing clarity and certainty for both parties.

Taken together, these provisions ensure that the transaction is clearly documented, risks are properly allocated, and both parties have a shared understanding of their rights and responsibilities under the agreement.

Legal advice for international clients

We regularly advise international clients on share transactions in Spain and understand the practical and legal issues that can arise when different legal systems, languages and commercial expectations are involved. Our English-speaking Spanish solicitors are experienced in handling cross-border transactions and provide clear, straightforward advice throughout the process.

We take the time to explain the legal and commercial risks in plain English, helping you make informed decisions at each stage of the transaction. Whether you are buying or selling shares, we focus on keeping the process efficient while ensuring that your interests are properly protected under Spanish law.

If you are entering into a Share Purchase Agreement and need advice from an English-speaking solicitor, we are here to help. To arrange a no-obligation consultation, contact our team by completing the contact form, emailing info@gbabogados.co.uk, sending us a WhatsApp message or calling +44 (0)20 3137 1320 or +1 646 751 8496.