Dissolution of Spółka z o.o (equivalent of limited liability company)

If for some reason you do not want to run a company (Sp. z o.o), or transform it into another form of legal entity or even put it as an asset into another company, it is nothing left but dissolution. You should know, however, that this will be a formal, time consuming so costly process.

The purpose of the dissolution of the company is termination of its activity, ie termination of its current affairs, repayment of liabilities, recovery of receivables and transformation into cash any other assets hold by the company.
At that time of liquidation any company’s undertakings are only possible within the scope necessary only to complete any undertakings that are already in progress.

Dissolution of the limited liability company (sp. z o.o. ), takes place in few stages:

1. Commencement of liquidation due to:
– as defined in the company’s agreement, or
– a resolution of the shareholders of the company.

2. Appointment of Liquidators of the Company, who represent the Company during the liquidation process.
Usually members of the Management Board of the Company, are the Liquidators unless the Shareholders decide otherwise.

3. Opening the liquidation proceedings to the Registry Court and publication of the announcement of the opening of liquidation in the “Monitor Sądowy i Gospodarczy”, together with the request to creditors of the company to submit claims. Creditors have to file for claims within 3 months from the date of publication of the announcement in the MSIG.

4. Preparation of the opening balance sheet of liquidation.

5. During the liquidation process, no profit can be paid to the shareholders.

6. In the moment of the opening of the liquidation process all proxies appointments expires.

7. The division of assets remaining after the repayment of liabilities can take place only after the expiry of six months from the announcement of the opening of liquidation process.

8. If there are disputable claims or not yet due, the amounts needed to satisfy such claims should be lodged with the court.

9. After completion of the liquidation proces but on the day preceding the division between shareholders any remaining assets, should be prepared Financial Report. This report must be announced at the company headquarters and must be approved by company’s shareholders.

10. Finally, the application is submitted to the Court to remove the company from the Register (KRS).

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