Business Liquidation Procedure: Legal Literacy and Efficiency
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Business is always a risky endeavor. Things don’t always go according to plan, and one day the owner may decide to liquidate the company.
The liquidation procedure for a legal entity is stipulated by the legislation of the Republic of Moldova, and liability may arise for its violation. That is why more and more business owners are opting for legal assistance when liquidating their companies.
How is the liquidation of a legal entity carried out?
The liquidation of a legal entity can be initiated either by the decision of the founders themselves (voluntary) or by a court order (compulsory).
The reasons for voluntary liquidation may include:
- Business unprofitability;
- Bankruptcy;
- The necessity to close the business after completing its objectives;
Even voluntary liquidation of a company is not a quick process and can take up to 6 months. Before liquidation, the State Tax Service will conduct a tax audit of the company to identify any accounting errors or tax evasion.
To carry out business liquidation, you will need to:
- Hold a board meeting and issue a decision to liquidate the company, appointing a liquidator.
- Register the decision and file an application for dissolution of the legal entity.
- Conduct an inventory of the company’s assets by the liquidator and manager.
- Publish the decision in the Official Gazette of Moldova within 15 days.
- Notify all known creditors of the company about the decision at the same time.
- Wait for creditors to submit their claims, then draw up a liquidation balance sheet.
- Satisfy creditors’ claims.
- Draw up a final balance sheet and transfer the asset allocation plan to the manager.
The company will also need to prepare and submit documents and reports to various government agencies.
To make the liquidation process as smooth as possible, it is advisable to contact Bulr lawyers. Our experienced lawyers can help you with the legal paperwork and provide qualified support from the start of the process to the exclusion of the company from the state register of legal entities.
BULR also offers a full range of legal and accounting services for businesses, delivered through outsourcing. These services include essential business services such as: debt collection, tax planning and optimization, corporate dispute resolution, contract development and analysis, assistance with obtaining licenses and permits, appeals against decisions of regulatory authorities and Due diligence.
Our team is always ready to help you with your most challenging legal and accounting needs.