Since 2012, the basis for the 5% registration duties applicable in case of sale of shares in a real estate rich company is the fair market value of the real estate property or property right held by the company increased by the fair market value of its other assets decreased only by liabilities linked to the acquisition of the property. This measure has raised many issues of interpretation in particular, in case of refinancing, construction, shareholding chain of companies, therefore creating uncertainty, tax risks and insecurity. The French tax authorities never issued administrative guidelines on that text.
Further to a strong lobbying of the tax community, the finance bill has cancelled this specific provision so that the 5% registration duty is assessed under standard rules, i.e. based on the sale's price of the shares (or their fair market value if higher) as it was the case prior to 2012.
Entry into force: applicable to sales as from 2 January 2015