Assets in a registered partnership
According to the law, separate ownership of each partner's property applies in a registered partnership. In this case, each partner manages their own assets, there is no joint property, and each partner is liable for their own debts with their own assets. It can be contractually agreed that other provisions apply. In particular, the so-called community of accrued gains, which applies by law to marriages, can be agreed. This is done with a property agreement.
What are the features of the community of accrued gains?
Here, a distinction is made between own property and the acquired property of the spouses. Own property includes personal items and the assets owned prior to the registration of the partnership, as well as gifts and inheritances. Acquired property includes assets that the partners acquire against payment during the duration of their registered partnership, such as salary, or earnings from own property (interest, dividends, etc.). Upon dissolution of the partnership, for example through death or divorce, each of the partners keeps their own property and each receives a half of the acquired property of the other partner less any debts (so-called “surplus”). This settlement is not necessary in the case of separation of property, since the assets remained separate. You can find additional legal information in this article How do you set up your marriage contract correctly?.
Why does it make sense to have a property agreement?
The partners can use a property agreement to agree that the financially weaker partner is better protected financially and/or that the interests of the children of the partner are taken into account.
What has to be in the agreement?
The content and scope of the property agreement depends on the parties’ individual situations. In particular, the property contract can also be combined with an inheritance agreement ( appointment of the partner as sole heir, bequests, etc.).
However, some points should definitely be included:
- First name, last name, address of the parties to the contract;
- Day the partnership was registered;
- Details of any children and the parents of the partners;
- Information on the property regime of the community of accrued gains;
- Date and personal signature of both parties to the contract and that of the notary.
In addition to the change of property regime, the registered partners – as with spouses in a marriage contract – can adapt the community of accrued gains to the model of their partnership. The law allows various modifications.
For example, the partners can choose to agree arrangements regarding the division of property that differ from that of the legally prescribed one-half share. Especially in the case of death of one the partners, it can be stipulated that the entire “surplus” is assigned to the surviving partner (see section I.A.3.1 of the sample agreement). Here, it must be noted that the mandatory shares of the children cannot be infringed upon. On the other hand, the mandatory shares of the partners’ parents are not protected.
It may also make sense to regulate the surplus share in case the surviving partner registers a new partnership at a later date. Here, the privilege may, under some circumstances, no longer correspond to the will of the deceased partner (see section I.A.3.2 of the sample agreement).
By means of a property contract, the partners can also declare the assets of the community of accrued gains to be own property that is defined for the exercise of an occupation or for the operation of a company. The partners can also agree that the earnings from own property are to be excluded from joint property.
What form does a property agreement have to be drawn up in?
The property agreement must be concluded in writing, signed by the partners, and officially certified. This ensures that the contractual parties have been informed of the legal situation by the notary and the effective will of the parties has been clarified. The formal regulations apply even after the amendment or dissolution of the property agreement by mutual agreement.
Can the property agreement only be drawn up after we register our partnership?
No. A property agreement can also already be concluded before the partnership is registered. The agreement takes effect as soon as the entry has been made. A property agreement can also be concluded at any time after the entry. In particular, it can also be agreed that the new property regime of the community of accrued gains applies retroactively from the date of registration.
How can the agreement be dissolved?
The property agreement can be dissolved or amended by mutual agreement of the parties at any time. By doing so, the ordinary property regime of separation of property can be reinstated. This can also be done retroactively.
If there is no mutual agreement of the partners regarding the property agreement, then a unilateral request of one of the partners for separation of property by court order can be submitted. However, there must be grounds for doing so, such as the overindebtedness of the other partner.
What else needs to be borne in mind?
An asset inventory can be drawn up by the partners for the purpose of having evidence and to create clarity regarding ownership.
You will find a sample property agreement and asset inventory below (available only in German, French and Italian).