In light of the recent amendments to the Commerce Act, effective as of September 2024, a new proceeding for liquidation of commercial companies has been introduced, known as the “Expedited liquidation proceeding.” This procedure provides companies with the opportunity for a quicker termination of their business activities under certain conditions. The primary objective of these amendments is to reduce the administrative burden and costs associated with liquidation.
The new regulations allow for expedited liquidation if the company has ceased its operations by resolution of the general meeting and/or with the consent of the shareholders, subject to meeting the following additional requirements:
- The company has not engaged in business activities or has ceased its operations for a period longer than 12 months;
- The company has not been registered for VAT purposes or has deregistered at a time preceding the last 12 months;
- No new workers and employees have been hired for a period longer than 12 months, or the employment relationships with workers and employees have been terminated at a time preceding the last 12 months;
- The company has no outstanding liabilities to the state or municipalities and is not involved as a party in any court or enforcement proceedings.
The procedure begins with submitting an application for starting a liquidation at the Commercial Register, after which the liquidators have a period of three months to settle any potential claims from creditors. A key advantage of the newly introduced proceeding is the reduction of the liquidation period, compared to the time periods under the general liquidation procedure.
The expedited proceeding will save a considerable amount of time and costs for the large number of companies which have not performed activities for a continuous period and whose liquidation poses no risk for the rights and interests of third parties.
Our law firm has considerable experience in handling liquidations and provides full legal assistance during all steps of the liquidation process – starting from the preparation of necessary documents and up to the final closure of the company.
If you require assistance with the liquidation of a company or similar matters, please do not hesitate to contact us.