What is Contract Transfer?

Contract transfer requires that the transferring party and the receiving party draw up a written agreement and that the counterparty (the other contract party) gives consent. Without that consent, the transfer is not valid.

Contract transfer occurs in business acquisitions, mergers, restructurings, and situations where a company divests an activity. An IT firm selling its helpdesk division to a specialised provider transfers the existing service contracts to the buyer. A wholesaler being acquired transfers all its supplier contracts to the new owner.

The distinction from assignment of claims is important. With assignment, you transfer only a right to receive payment (for example, the right to collect an invoice). With contract transfer, you transfer everything: the right to deliver, the duty to pay, warranty obligations, confidentiality duties, all rights and all duties.

In practice, contract transfer can be complex when the contract contains specific personal elements. A consulting agreement where the service is tied to a specific consultant cannot simply be transferred. The counterparty entered into the contract precisely because of that person.

Consent from the counterparty can be given in advance in the contract itself, through a clause that permits contract transfer in the event of an acquisition. This saves time when the situation arises.

During business acquisitions and restructurings, contract transfer is unavoidable. Weshare (2025) reports that 95 percent of organisations lack full visibility into their contractual obligations. If you do not know which contracts you have, you cannot transfer them properly. Incomplete transfer leads to contracts that nobody manages, deadlines that nobody monitors, and obligations that are not fulfilled.

For SMBs being acquired or acquiring a business, an inventory of all active contracts is the first step. Each contract must be assessed for transferability, and consent must be requested from each counterparty.