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20. June, 2024

Dissolution of a company through the simplified procedure

A company can be dissolved through a simplified procedure without liquidation if all shareholders propose to the registration authority that the company be deleted from the register without liquidation. Along with the proposal, they must submit a resolution of dissolution through the simplified procedure and a notarized statement from all shareholders confirming that all company obligations have been settled and that they assume responsibility for any remaining obligations. The court may request all necessary evidence.

Key steps in company dissolution

The dissolution of a company through the simplified procedure typically takes 2–6 months, as the court must issue 3 procedural resolutions.

Creditors can claim their debts from the shareholders who provided the statement mentioned above within two years after the company is deleted from the register. Shareholders are jointly liable for obligations with all their assets.

The dissolution resolution must include:

  • The company name and headquarters
  • The body that adopted the dissolution resolution
  • An indication that it is a dissolution through the simplified procedure
  • The number of shareholders and their names and residences
  • A proposal for the distribution of assets

Responsibilities of shareholders

In the case of the simplified liquidation procedure, shareholders are responsible for any company obligations for two years.

The court publishes the dissolution resolution, including the names, surnames, and residences or company names and headquarters of all shareholders who have assumed responsibility for any remaining obligations to creditors.

Shareholders, creditors, or competent state authorities can file an objection to the dissolution resolution within 15 days of its publication. If the registration authority finds the objection justified, it will annul the dissolution resolution and inform the company’s bodies. The company must then continue the liquidation process or simply adopt a new dissolution resolution based on the circumstances.

During the dissolution process, the company continues to be governed by the Companies Act, tax regulations, and other relevant laws. If the liquidation process begins, the company must prepare a balance sheet and an income statement as of the day before the start of the process.

Before considering liquidation, the company/shareholders should review all legal, tax, and financial implications of such a process.

We recommend consulting our team of experts at Unija Consulting before deciding on liquidation or company closure. They will help you find the right solution for your company.

Contact us via the LINK to book a consultation with a tax expert.