Liquidation, bankruptcy or closing a company in Poland, for whatever reason, can be daunting if you are unaware of the potential steps or pitfalls involved. Without specialist knowledge you may fall at the first hurdle and it is better to close or wind up the company in Poland cleanly without leaving a stack of administrative liabilities behind you. Our staff at Close a European Company can provide a full package of bespoke services according to your individual/corporate requirement as follows:
We offer the following services for dissolving/winding up a company:
- Accountancy advice
- Taxation services
- Legal advice
- Liquidation and insolvency services
- Personal Liability Advice
- Advisory/Restructuring Services
OPTIONS FOR DISSOLVING/WINDING UP A POLISH COMPANY?
The procedure for liquidation of a company is highly formalised, comprising several stages. Dissoluton of the company by way of liquidation is possible only if the company is solvent and has sufficient funds available to complete the process of liquidation (or if these will be financed by the shareholder). This means that funding must be available to satisfy the rights of creditors and shareholders. The process in practice last for between 9-18 months. In order to ensure that the Polish company is closed in the proper manner and in the quickest possible timeframe you will need to follow the steps below:
- A balance sheet as at the opening of the liquidation is prepared
- A meeting of shareholders is convened and held; resolutions approving the opening of the liquidation and appointment of a liquidator are passed
- Documentation is filed at the company registration court
- The company's name is extended by a suffix "in liquidation"
- The liquidator assumes the role, duty, responsibilities and liabilities of the board of directors
- An announcement regarding the liquidation is placed in official publications inviting creditors to come forward
- A period of 6 months from the date of publication of such announcements passes
- The liquidator causes the company to satisfy the claims of creditors
- Following such 6 month period and in the event that the liquidator is satisfied that all creditors' claims are sufficient, the liquidator may start actions to close the company
- Further shareholder resolutions, balance sheets and filings at court are required
- The company must continue, until the moment of its liquidation, to satisfy all normal company secretarial and compliance obligations of the company, including maintenance of accounts, tax and other filings.
- No dividends may be paid during the process of liquidation.
- Liquidation proceeds may be distributed only at the close of the liquidation.
ADVANTAGES OF LIQUIDATION
- This is the only straightforward way of ensuring that your company is closed in the correct manner
DISADVANTAGES OF LIQUIDATION
- Expensive but the only way that a company can be dissolved in the most efficient manner
- If the company is not dissolved in the proper manner then this could take time and money, please contact us on +44 (0)203 114 5113 for assistance and fees for winding up your company in Poland
If a company becomes insolvent, the directors have a duty to file for bankruptcy of the company within 14 days of the moment that the company becomes insolvent. A company is insolvent if it is not able to settle a debt on the date when it becomes due in the ordinary course of business. Please call us for further assistance in these cases.
What happens if a company becomes insolvent?
- The directors have a duty to file for bankruptcy of the company within 14 days of insolvency
- If directors fail to comply with this obligation, the directors can be liable for the company's liabilities towards creditors (including the company's tax liabilities)
- This would also be a criminal offence
- The liability can be avoided if an application for bankruptcy is filed on time
- In the event that a bankruptcy proceeds, court appointed receiver carries out the process of gathering in assets and satisfying liabilities. The State Budget (taxes etc) the court, the receiver and staff are among the preferred creditors.
- The court will reject an application for bankruptcy if the company unable to pay even the cost of the bankruptcy proceedings
- This is a common situation for private companies (S.p. z.o.o.) since, if the company is insolvent, it is unlikely that the company will be able to cover such a cost.
- To close the company, the shareholders would need to consider financing the company, thereby making it solvent and to carry out the liquidation process described above.
- Failure to act either to close the company or to ensure its continued solvency exposes the directors.
- Please contact us urgently if this is the case and our insolvency lawyers will assist you.
For both options it is important to take care to protect the assets of the business, to conform to the liquidator's wishes and to act responsibly. Please contact us for further information and advice as to how to proceed.