Inheritance in a Family Business: The Articles of Association Decide
Business succession and succession clauses: how family businesses prevent inheritance disputes and deadlock
According to media reports, a long-running inheritance dispute in a well-known business family is once again occupying the public. The pattern is common: where there is no coordinated succession arrangement, the death of a shareholder becomes a stress test for the company. What matters in such cases is often not the will, but the articles of association (Gesellschaftsvertrag).
GmbH: Shares Are Always Heritable
§ 15 Abs. 1 GmbHG provides: “The shares are transferable and heritable.” The articles of association cannot exclude inheritance as such. The share therefore initially passes to the heirs – including those whom the other shareholders do not wish to see in the business.
Several heirs form a community of heirs (Erbengemeinschaft). Under § 18 Abs. 1 GmbHG they may exercise the rights attached to the share “only jointly”. If the co-heirs disagree, shareholder resolutions risk being blocked. Moreover, vis-à-vis the company only the person entered in the shareholder list (Gesellschafterliste) filed with the commercial register counts (§ 16 Abs. 1 GmbHG); the list should be updated promptly after the death.
Steering Through the Articles of Association
The circle of eligible successors can be limited by provisions in the articles of association:
Redemption clause (Einziehungsklausel): The company may redeem – that is, cancel – the share of an heir who is not entitled to succeed, against compensation. Redemption must be permitted by the articles of association (§ 34 Abs. 1 GmbHG). If it is to take place without the heir’s consent, its conditions must have been laid down before the death (§ 34 Abs. 2 GmbHG).
Assignment clause (Abtretungsklausel): The heir must transfer the share to a fellow shareholder or a specified third party.
The key point is the compensation. Restrictions are in principle permissible, but must not be grossly disproportionate to the market value (BGH, judgment of 16.12.1991 – II ZR 58/91). For the case of death, more extensive restrictions are discussed; their limits must be examined in each individual case.
Partnerships: The Contract Decides
In the case of the general partnership (OHG) and the legally capable civil-law partnership (GbR), a partner in principle leaves the partnership upon death; the partnership continues without the heirs (§ 130 Abs. 1 Nr. 1 HGB, § 723 Abs. 1 Nr. 1 BGB). The heirs then receive a compensation claim, unless the contract restricts it. If the partnership agreement provides for continuation with the heirs, the share, where there are several heirs, passes directly to each of them in proportion to their share of the estate (§ 711 Abs. 2 BGB). Where only one particular heir is to succeed, this is called a qualified succession clause (qualifizierte Nachfolgeklausel). If an heir becomes a personally liable partner, the heir may apply to become a limited partner (Kommanditist); if the other partners refuse, the heir may terminate without notice – within three months (§ 131 HGB, for the GbR § 724 BGB). On the death of a limited partner, the partnership is, under § 177 HGB, “continued with the heirs” in the absence of a contractual provision to the contrary. In a GmbH & Co. KG, the KG interest and the interest in the general-partner GmbH must be regulated in parallel.
Coordinate the Will and the Articles of Association
A frequent source of error is a contradiction between the two documents: the will, for instance, appoints all children equally as heirs, but the articles of association admit only one successor. The consequences may be compensation claims against the company and compulsory-portion (Pflichtteil) or equalisation claims against the successor. The inheritance-tax relief for business assets is currently pending before the Federal Constitutional Court (Bundesverfassungsgericht); tax questions should be coordinated with the tax adviser.
Practical Checklist for Companies
Review the succession clauses in the articles of association and adapt them to the family situation
Coordinate the will, the marital agreement (Ehevertrag) and the articles of association
Review the compensation provision for validity and affordability
Provide for a joint representative for communities of heirs
Consider an arbitration clause for shareholder disputes
Conclusion
An inheritance dispute cannot always be prevented, but its consequences for the company can be limited. Please do not hesitate to contact us if you have any questions.
Status: 19 October 2026
NIETZER Rechtsanwälte · Attorneys at Law (USA) · Heilbronn · www.unternehmensrecht.com
This article is for general information purposes and does not replace legal advice in an individual case.
