Liquidation of a legal entity
Liquidation of a legal entity is quite a costly process both in terms of time and finances. The company “First Legal” provides legal support to the client at all stages necessary for a successful liquidation of a legal entity with minimal costs and achieving the required result.
According to the norms of current legislation, a legal entity may be terminated as a result of reorganization (merger, accession, division, transformation) or liquidation.
As for the liquidation of a legal entity as one of the forms of termination, it may occur in the following cases:
- By decision of its participants (participant) or the authorized body of the legal entity to make a decision on the termination of the legal entity; in connection with the expiration of the term for which the legal entity was established; in connection with the achievement of the goal for which the legal entity was created, and in other cases provided for by the founding documents.
- By a court decision on the liquidation of a legal entity.
The most popular method of liquidating a company, and one that is often used by clients, is the adoption of their own decision by the participants (participant) on termination (applicable to limited liability companies and private enterprises).
The liquidation process has several stages that are necessary and important to achieve the desired result, namely, the entry in the Unified State Register of Legal Entities, Individual Entrepreneurs, and Public Formations regarding termination.
The main stages of liquidation of a legal entity include:
- Adoption by the participants (participant) or the authorized body of the legal entity of a decision on the liquidation of the legal entity, which is documented in the minutes (decision of the participant). At the same time, the composition of the liquidation commission is formed and approved or a liquidator is appointed.
- Entry in the Unified State Register on the decision to liquidate the legal entity and on the composition of the liquidation commission or the liquidator, thereby announcing the start of the liquidation procedure.
- Notification of the supervisory authorities about the start of liquidation and the need for audit inspections.
- Identification of the creditors of the legal entity and notification of them about the start of liquidation.
- Preparation of liquidation reporting, conducting an inventory, closing separate subdivisions of the legal entity, and settling accounts with creditors.
- Conducting a tax audit, audits by the Pension Fund and social insurance funds, followed by deregistration of the legal entity with these supervisory authorities.
- Transfer of documents subject to mandatory long-term storage to the archive, destruction of seals and stamps.
- Entry in the Unified State Register of Legal Entities, Individual Entrepreneurs, and Public Formations regarding liquidation.
Before starting the liquidation procedure, the client must prepare and provide the following documents:
- The founding documents of the legal entity: the charter, an extract from the Unified State Register, certificates of registration with the supervisory authorities;
- Minutes of general meetings or the participant’s decision, orders on the appointment and dismissal of the director;
- Accounting documents, bank statements, data on payroll calculation, statements from accounting records;
- Contracts, acts of completed works, primary accounting documents, etc.
During the liquidation procedure, and especially during inspections by supervisory authorities, the list of documents may change and be supplemented.
At first glance, the liquidation of a legal entity seems like a simple procedure, but in practice, it is quite complicated, even considering some “simplifications” on the part of the legislator. It should be noted that there is case law regarding the cancellation of the liquidation of a legal entity, even after an entry on termination has been made in the Unified State Register. Therefore, contacting the specialists of the company “First Legal” in this matter will significantly simplify all stages of the liquidation procedure of a legal entity from its beginning to completion.