The transfer of an undertaking refers to the transfer of a discrete economic entity to another party, for example, the sale of a business to a new owner. The interests of employees in such a transfer is regulated by Council Directive 77/187 of 14 February 1977 on the approximation of the laws of the Member States relating to the safeguarding of employees’ rights in the event of transfers of undertakings, businesses or parts of businesses (as amended by Directive 98/50 of 29 June 1998; consolidated in Directive 2001/23 of 12 March 2001), which applies to the transfer of an undertaking, business or part of a business. In the event of the transfer of an undertaking, the terms and conditions of employment in contracts and collective agreements are safeguarded, but employment itself is not always guaranteed.
In 2007, further regulations came into effect specifically relating to public passenger transport services by rail and by road and repealing previous regulations. Most notably, this new regulation allows Member States to safeguard the conditions of transfer of other rights of their employees other than those covered by Directive 2001/23. If necessary, therefore, Member States can take into account the social standards established in the legislation, regulations or national administrative provisions, or collective agreements or agreements concluded between the social partners. (Source: https://www.eurofound.europa.eu/observatories/eurwork/industrial-relations-dictionary/transfer-of-an-undertaking