Introduction
In Switzerland, acquisitions of a business mainly take two forms: the share deal, where shareholders sell (or simply transfer) their shares in a company to a buyer, and the asset deal, where a company transfers some or all of its assets, liabilities, and/or contracts to another company. In other words, in a share deal, the company is the target; in an asset deal, it is a party to the transaction agreement, the asset purchase agreement or, if there is no consideration for the transfer of the assets, the asset transfer agreement (APA/ATA).
The question of whether to transfer a business by share deal or asset deal is a commercial decision, and often it is tax driven. There also can be practical reasons for choosing an asset deal, e.g., for the carve-out of certain assets within a share deal transaction or in case of incurable title chain issues, where it is preferable to transfer the assets instead of tainted shares.
Once it has been decided that an asset deal is the way to go, there are again two legal concepts from which to choose under Swiss law: the asset transfer by 'singular succession' according to the Swiss Code of Obligations (CO), and the asset transfer by way of 'partial universal succession' according to the Swiss Merger Act (SMA).1
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