When we talk about demerger-merger, we are not dealing with the simple joining of two or more companies into one (merger) or the division of one company into two or more (demerger). The demerger-merger is characterized by combining elements of both operations: a company divides, and parts of its assets become part of other existing companies.

Although this figure is not expressly provided for in the law, the doctrine recognizes it as a legitimate operation, albeit atypical, resulting from the combination of demerger (articles 118 et seq.) and merger (articles 97 et seq.), both Commercial Companies Code.

When carried out by increasing the capital of the beneficiary company, this operation can benefit from the tax neutrality regime, provided that the companies involved are owned by the same partner(s). This avoids the taxation of capital gains or income, which, under normal conditions, would be subject to taxation.

This regime thus allows business reorganization without adverse tax effects, provided that the legal requirements set out in Article 73 of the IRC Code (CIRC) are met.

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