Pharmacy sales: requirements, licences, taxes and employees in a secure transfer

In this article we analyse, based on case law and notarial practice, the keys to a secure pharmacy transfer, both for the seller and the buyer.

Pharmacy offices are private healthcare establishments of public interest, according to article 1 of the Law 16/1997, on the Regulation of Pharmacy Office Services.

Although they belong to individual pharmacists, their operation is subject to administrative authorisation and to the health planning of each autonomous community.

This dual nature explains why the transfer of a pharmacy is not governed by the simple commercial rules of business sale, but requires a mixed procedure, in which administrative, civil, tax and labour law converge.

Thus, the Supreme Court, in its Judgment 259/2013, of 30 April, emphasised that the pharmacy, although its ownership is highly personal, has an economic value susceptible to transfer, as it integrates an asset set formed by the health authorisation, the clientele, the furniture and the goodwill.

Any pharmacy transfer requires prior authorisation from the competent Health Department and the Official College of Pharmacists.

In Catalonia, this is established by Law 31/1991, of 13 December, and Decree 40/1992, which regulate pharmaceutical organisation.
The buyer must be a registered pharmacist, meet the legal requirements for professional practice and obtain the authorisation for change of ownership.

The health licence cannot be freely transferred: it is personal in nature and can only be transferred with express authorisation.

Therefore, the sales contract usually includes a suspensive condition, with its effectiveness subject to administrative approval.

Case law and notarial doctrine agree that the licence, although an administrative right, has patrimonial value and forms part of the business assets. In the words of the Supreme Court, “the administrative authorisation is not community property, but its economic value can be”.

The Notary plays a decisive role in the transfer of pharmacies.
They must verify the ownership, the validity of the licence, the capacity of the parties and the legality of the transaction, ensuring compliance with health, civil and tax regulations.

The pharmacy sale deed usually includes:

• Identification of buyer and seller (both registered pharmacists).
• Reference to the health authorisation and professional association certificate.
• Description of the establishment (address, licence number, inventory).
• Price and payment method, with identification of the means in accordance with Law 36/2006 on fraud prevention.
• Inventory of stock valued separately.
• Labour subrogation clause.
• Declaration of being up to date with tax and labour obligations.
• Warnings about taxes (VAT, ITP and AJD).

The Notary must expressly warn that, although the sale is not of real estate, the deed is subject to AJD as it is registrable in the Registry of Movable Property, according to the Supreme Court Judgments 1607/2020 and 1608/2020, both dated 26 November.

If the premises where the pharmacy is located are rented, the buyer can take over the contract with the landlord's consent, in accordance with article 32 of the Urban Leases Act (LAU).

In some cases, the health Administration requires proof of the right to use the premises (ownership or lease with the right of transfer).

The notarial deed must expressly reflect this continuity in the right to occupy the premises.

The transfer of a pharmacy involves a business succession, in accordance with article 44 of the Workers' Statute.

This means that the buyer automatically takes over the employment contracts, maintaining the seniority, salary, and conditions of the employees.

The buyer inherits the labour rights and obligations of the previous owner, so the dismissal of workers without cause would be unfair.

Employees who are pregnant, on maternity leave, or working reduced hours are especially protected.

In practice, during the negotiation, the so-called labour liabilities are analysed: seniority, severance payments and wage costs.
According to Asefarma, there are two common scenarios:

1. Pharmacy free of staff: the seller dismisses the team beforehand, assuming the severance payments and settlements.
2. Pharmacy with subrogation: the buyer accepts the staff, deducting from the price the cost of possible severance payments.

The subrogation clause must be included in the deed, with the nominal list of workers and their conditions.

The seller must prove that the payroll, extra payments and holidays are settled up to the date of the transfer.

The pharmacy team is not just a cost: it is an asset.

Their knowledge of the clientele, management software, and internal procedures can be decisive for the continuity of the business.

As Gómez Córdoba highlights, retaining part of the team facilitates the transition and preserves customer trust.

The total transfer of a pharmacy (licence, goodwill, stock and lease) is not subject to VAT, according to article 7.1.a) of the VAT Law (37/1992).

It is also not subject to the Property Transfer Tax (ITP), as it is a business transaction (art. 7.5 of the TRITPAJD).

However, the Tax on Documented Legal Acts (AJD) is payable, as it is documented in a public deed and registered in the Register of Movable Property.

This was confirmed by STS 1607/2020 and 1608/2020, mentioned above, which declared it subject to AJD with a taxable base based on the declared value.

When the transfer is partial (for example, a quota or share), it may be subject to VAT and equivalence surcharge, according to the seller's tax regime.

For the buyer:

• The loan interest, notarial and registration expenses are deductible as financial expenses.
• The goodwill can be amortised for tax purposes (art. 12.2 of the Corporate Tax Law).

For the seller:

• Labour compensation arising from the transfer is a deductible expense.
• Capital gains are taxed under the Personal Income Tax or Corporate Tax, depending on their tax regime.

In the case of a donation between pharmacist family members, a 95% reduction applies in the Inheritance and Donations Tax (art. 20.6 LISD), if the new holder maintains the activity for five years.

The health licence is personal, but its economic value is part of the transferable assets.

This was recognised by the STS 259/2013 of 30 April , stating that the licence “forms part of the asset value of the pharmacy” and can be included in inheritances or marital settlements.

The process of changing ownership requires:

1. Application to the Department of Health.
2. Proof of the buyer's qualifications and professional registration.
3. Certificate from the College of Pharmacists.
4. Submission of the public deed of sale.

In Catalonia, the resolution usually takes between three and six months. During this time, the sale may be held in notarial deposit until the transfer is formally authorised.

According to STS 469/2003 of 14 May, the ownership of the pharmacy belongs exclusively to the pharmacist, but the economic value generated during the marriage may be community property.
This means that, in a community property settlement or inheritance, the non-pharmacist spouse or heir cannot be the owner, but can receive the economic compensation equivalent to the patrimonial value.

This criterion, followed by the Directorate General of Legal Security and Public Faith, must be reflected in wills before a Notary or marriage agreements, to avoid succession conflicts.

The purchase and sale of pharmacies is one of the most regulated operations in the healthcare and notarial fields.

It involves coordinating healthcare, tax, civil, and labour regulations, and ensuring the continuity of the public service.

The Notary plays an essential role in verifying the legality of the contract, advising on taxation, and warning of labour and administrative obligations.

Only through a well-structured public deed, with the corresponding healthcare authorisation and appropriate tax warnings, can a valid, secure, and sustainable transfer over time be ensured.