Dissolution and liquidation of companies has become easier

Two new laws have made the dissolution and liquidation
of companies easier because
the liquidation procedure itself is now simplified.

The law of 19 March 2012 amending the Companies Code regarding the liquidation proceedings and the law of 22 April 2012 amending the Judicial Code regarding the liquidation of companies, entered into force on 17 May 2012.

1. Dissolution and liquidation in one single deed

The main change concerns the fact that from now on it is possible to decide the dissolution and liquidation of a company in one single act, on the following conditions:

there is no liquidator appointed;

there are no liabilities;

all shareholders are present or represented at the general meeting and decide by unanimous vote;

the assets are taken back by the shareholders themselves.

2. Other modifications and simplifications

Futhermore, below is an overview of the major new elements in the law:

The competent judge: it is now the president of the Commercial Court, as sole judge, who treats the requests for appointment, confirmation, registration and replacement of the liquidator. Previously, it was the commercial court that was competent.

The procedure to appoint a the liquidator, its confirmation by the President of the Commercial Court was also adapted, as follows:

>The president of the court is seized by means of a unilateral request of the company. Also the public prosecutor or any third party may file such a request.

>That unilateral request can be executed by either the liquidator, an attorney, a notary or by a director or manager of the company, while before this was only possible by a competent organ of the company or by a lawyer; the law does not require anymore that the request is accompanied by an assets and liabilities statement.

>The law does not require anymore that the request is accompanied by an assets and liabilities statement.

>The president of the court must rule no later than five working days after the filing of the request. If no decision is taken within that period, the appointment of the liquidator is deemed to be confirmed or approved.
Until now the court had only 24 hours to rule, but there was no sanction for failure to comply with this deadline.

>The decision to appoint the liquidator may include one or more liquidator candidates, possibly in order of preference, in case the liquidator's appointment is not confirmed or approved by the president of the court. It was already a practice to mention this in the notary deed of dissolution of a corporation.

>If the liquidator is a corporate entity, the decision to appoint it, must also appoint an individual as representative for the execution of the mandate.

>In case of non-compliance of the liquidation proceedings, the public prosecutor or any third party proving to have an interest, may request the President of the competent court to replace the liquidator after having interviewed him.

The liquidator has the obligation to file a status report in the 7th and 13th month regarding the previous six months, after the liquidation started, instead of the 6th and 12th month of the first year.

The plan relating to the distribution of assets can now be signed and filed either by the liquidator, an attorney, the notary, or a director or manager of the company. It must be filed by one of the above listed for approval by the competent court, prior to closing the liquidation process.