أثر الاندماج على استمرارية عنصر الإجارة للشركة المندمجة

Abstract EN

The merger is one of the methods in which the legal personality of merged companies is demised; which entails a transfer of all its rights and obligations to the merging company, in accordance with the provisions of Article 238 of the Jordanian Companies Law.

However, this may not be so clear when it comes to the right to lease as an element of the business (lease continuity).

Does the merger require the continuity of the lease and be transferred to the merging company? The Jordanian judiciary, represented by the Court of Cassation, consecrated the non-continuity of the lease contracts in such case in accordance with the provisions of Article (5-C-3) of the Landlords and Tenants Law, which allows the evacuation of the rented property “if the tenant or part of the rented property is rented to another person or allowed to be occupied it without the owner’s consent, or vacated to someone else without that consent”.

The problem of the study is that there is a clear vision on the possibility of moving the element of leasing as an element of the business from the merged company to the merging company without the consent of the landlord.

This study discusses the effectiveness of this legislative and judicial trend from the lack of continuity of leases in the case of merger and the extent of its agreement with the legislator’s philosophy in the idea of merger.

The study suggests solutions to avoid imbalance, lack, and contradiction of such trend.

It concluded with a set of findings and recommendations.

Finally, the study highlighted the need to expressly state, in Article 238 of the Companies Law, the transfer of the right to rent, as a component of the business elements, to the merging company, and to be considered as an element of financial disclosure that is transferred to the merging company with the remaining rights and obligations