Shareholder's Agreements and Succession Pacts

The family protocol is a legal instrument that, regardless of the applicable corporate regulation, intends to organize the interaction between a family and their family-owned business, to clearly distinguish both spheres and most importantly, to plan the succession of the closely-held family business to the next generation. Adopting the recommendations of the European Forum on the Transfer of Business that took place in Lille in 1997, this research paper studies the succession provisions generally included in family protocols, specifically the role of contractual agreements as the legal instrument that ensures a successful transfer of the closely-held family limited partnership. The regulatory framework of this paper is, on one hand, the last reform of the Spanish Civil Code regarding closely-held family limited partnerships and on the other, the present debated reform of the Fourth Volume of the Catalan Civil Code concerning succession agreements that aims to be a step further from the regulation currently in force. This paper also points out the risks that may arise from the use of succession agreements outside of the contexts of family relations or of the closely-held family limited partnerships