Division of company shares in a commercial company (OOD): what is permissible and how it is done

When we talk about the “division” of shares in an OOD (LLC), we must first clearly distinguish three things: splitting a specific single share, co-ownership of shares, and transfer/inheritance of shares. The law explicitly regulates all three hypotheses.

By virtue of the Commercial Act, the splitting of a single company share is not free: it is permitted only with the consent of the partners, unless otherwise agreed in the articles of association. This means that a judicial or unilateral “division” of a share without the will of the partners is not possible; a decision is required within the regime provided by the company. The provision is brief and categorical: “The splitting of a single company share is permitted only with the consent of the partners, unless otherwise agreed” (Art. 131 of the Commercial Act).

If a single share or a set of shares belongs to several persons (e.g., heirs), the law does not necessarily require a split: these persons exercise the rights under the shares only jointly, are jointly and severally liable for the obligations attached to them, and appoint a person to represent them before the company. This is the classic co-ownership of a share—functional when division has not been achieved or is not desired. The rule is in Art. 132 of the Commercial Act.

The transfer and inheritance of shares are separately regulated in the current chapter “Company Shares.” A company share may be transferred and inherited. The transfer agreement is concluded in writing with notarized signatures (unless the articles of association provide for written form only), and its effect is subject to registration in the Commercial Register. Between partners the transfer is free; to third parties—only in compliance with the rules for admitting a new partner and in the absence of unpaid due wages and social security contributions to employees. Such is the regulation of Art. 260z, paras. 1–2 of the Commercial Act, as well as the constant case-law of the Supreme Court of Cassation on registration issues around Art. 129/Art. 260z.

The current regulation upon the death of a partner is particularly important: if not otherwise agreed in the articles of association, the heirs who have expressed a desire to do so within three months from the opening of the inheritance enter the company. If the heirs do not wish to enter or do not submit a statement within the time limit, the company pays them the value of the shares under the law (their liquidation equivalent). This follows directly from Art. 260z, paras. 3–4 of the Commercial Act. In practice, when there are multiple heirs, they can either remain co-owners of the shares and exercise their rights jointly (Art. 132 of the Commercial Act), or—subject to the partners’ consent—request the splitting of a share/shares (Art. 131 of the Commercial Act).

From a procedural perspective, registration in the Commercial Register is the mandatory “external” step after a valid transfer agreement; it is precisely the registered circumstances that are relevant to the registration officer, including in subsequent dispositions with shares. This is also emphasized in the interpretative practice of the Supreme Court of Cassation (General Assembly of the Commercial College, Interpretative Judgment of 31.05.2023). In addition, the Registry Agency has provided methodological guidelines on applying the required form and evidence for the transfer of shares.

Very briefly: a “division” of a share in an OOD in the sense of private law cannot be imposed without the will of the partners—the law allows it only with consent (Art. 131 of the Commercial Act). When, instead of division, co-ownership is maintained, the co-owners exercise their rights together through a common representative (Art. 132 of the Commercial Act). Transfer and inheritance are possible in the form and procedure of Art. 260z of the Commercial Act, and upon the death of a partner the regime today is “entry of the heirs who so wish within three months,” or payment of the value of the shares if no entry occurs. This is the applicable positive law and it is the starting point for the assessment in every specific case.