Dissolution of a Slovak company without liquidation
The dissolution of a company without liquidation is considered a voluntary form of company dissolution. In this process, the company’s assets are transferred to a legal successor. A company without liquidation can be dissolved in several ways, including by merger, amalgamation, division, or by changing the company’s legal form.
Dissolution of a Slovak company with liquidation
The dissolution of a company with liquidation is applicable when a company is dissolved without a legal successor or when its entire assets are not transferred to a legal successor. In such cases, the company enters into liquidation, which is carried out by a liquidator based on authorization from the company or a court.
Liquidation in Slovakia occurs in several phases, and the entire process lasts at least six months, during which potential creditors may submit their requests for payment of outstanding debts to the liquidated company.
The goal of liquidation is to satisfy all creditors, settle property rights, and prevent the company’s insolvency. If the company becomes insolvent during liquidation, the liquidator is obliged to file for bankruptcy. Liquidation is tied to the date of the company’s dissolution.
If the company voluntarily enters into liquidation based on a shareholders’ decision, it begins on the effective date of record of the appointed liquidator into the Slovak commercial register (not earlier).
During the liquidation process, the company uses its business name with the addition of “in liquidation.”
The company’s managing directors have limited authority to only actions related to the liquidation. The liquidator acts on behalf of the company, assuming the authority of the directors. The liquidator fulfills the company’s obligations, collects receivables, enforces claims, represents the company before state and other authorities, concludes settlements and agreements with third parties, and notifies the entry of the company into liquidation.
If any assets remain after the liquidation is completed, these assets are subject to settlement. Each shareholder has a legal right to a share of the liquidation surplus. The share of the liquidation surplus is determined by the ratio of the shareholder’s contribution to the paid-in capital of all shareholders.
The liquidation process ends with the distribution of the liquidation surplus or the payment of proceeds from the sale of the company’s assets and the subsequent removal of the company from the commercial register, after which a final tax statement has to be submitted.
The liquidator is required to file an application for the removal of the company from the commercial register, which can be done based on a prescribed form by the Ministry of Justice of the Slovak Republic. The competent court shall remove the company within two days of the submission of the application. The company ceases to exist on the day it is removed from the commercial register.
Please note that the liquidation process in Slovakia requires several steps to be completed, including arranging a shareholders’ meeting, drafting all the necessary documents, arranging a meeting with a notary public to draft a notary deed, and coordinating with the accounting department or accounting service providers, as several financial statements need to be submitted to the tax authority.
Several applications to be addressed to the registrar court and the commercial journal administrator have to be submitted as well.
Therefore, it is recommended to cooperate with a local attorney who can handle all the procedures related to the liquidation on behalf of the client.
