REALWorld Law

Sale and purchase

Due diligence

Do buyers usually carry out due diligence?



Yes, usually before the execution of the sale and purchase agreement. For a single asset transaction due diligence normally takes around two to three weeks. In particular, investigations include verification of the title and encumbrances, leases and the zoning and planning situation.

It is common to agree on an exclusivity period for the buyer to carry out due diligence. 

The seller has to provide the necessary documents for the due diligence process. Following a decision of the Federal Administrative Court from 15 September 2023, the seller can additionally be required to inform the buyer about all substantial circumstances that are recognizably of particular importance to the buyer and about which the buyer can demand information in good faith. This obligation can in particular arise if the buyer only has a short period to carry out due diligence or if the relevant information are provided at the end of the due diligence process.