The Commercial Code distinguishes two phases of winding up of a company. In the first phase, a company is wound up with or without going into liquidation and in the second phase the company ceases to exist upon its removal from the Commercial Register.
When is it possible to wind up a company without going into liquidation?
Winding up a of company without going into liquidation is possible if the company has no debts or assets, or if the company’s assets are to be transferred to another legal successor (upon merger or division or change of a company’s corporate form). Liquidation is not required either where the company has gone bankrupt and bankruptcy has been rejected, cancelled or discontinued due to insufficient assets. A decision issued by a court is required.
Winding up of a company due to insolvency
If a company has no assets, the preconditions provided by the Commercial Register have ceased to exist. Partners are not entitled to approve winding up of a company without liquidation due to insolvency, but they have to file a petition to the competent court to issue a decision ordering the winding up of the company and accompany it by a statutory declaration as to the company’s insolvency with their authenticated signatures. The court then publishes a notification in the Commercial Journal of the Slovak Republic for a period of 6 months. After this deadline, the company is removed from the Commercial Register ex officio.
What does winding up of a company with liquidation mean?
Liquidation of a company is one of the legal actions preceding the winding up of a company based on the decision of the competent body on winding up of the company with liquidation (without legal succession). Liquidation of a company is a voluntary winding up of a company (unless the liquidation is ordered by court).
The purpose of liquidation is to identify all assets of the company or cooperative, settle any liabilities toward creditors including liabilities toward the state budget and distribute a potential liquidation balance among partners, shareholders or cooperative members according to the principles set out in the memorandum of association or the cooperative’s articles of association. Partners may stipulate the principles of distribution of the liquidation balance in the memorandum or articles of association. If this is not the case, the distribution of the liquidation balance is governed by principles established in the Commercial Code for the individual corporate forms of companies and cooperatives. Liquidation is governed by principles established in the memorandum of association or the Commercial Code only if bankruptcy and restructuring are not governed by other means of settlement and liquidation of a company.
Basic steps leading to liquidation of a company
- Adoption of a decision of the general meeting or the sole shareholder on winding up of the company – the decision should contain the date of winding up of the company, appointment of a liquidator, the remuneration of the liquidator and how the liquidator should act on behalf of the company.
- Submission of an application for the registration of changes in the relevant Commercial Register within 30 days from winding up of the company. Territorial jurisdiction of registration courts (only in Slovak) for proceedings in matters concerning the Commercial Register is determined based on the registered office of entrepreneurs or their place of business. Applications to the Commercial Register may be submitted in paper form (only in Slovak) or electronically via the service called Application for registration, change or deletion of data in the Commercial Register (only in Slovak). The service requires the application form to be downloaded. The forms can be downloaded at: Electronic forms for individual corporate forms of registered entities (only in Slovak). The application must contain a document certifying the winding up of the company without a legal successor and its going into liquidation, and a document confirming the appointment of a liquidator.
- Notifying all known creditors of the company about the company's going into liquidation.
- Publishing the notification in the Commercial Journal about the company going into liquidation.
- The fact that a company has gone into liquidation (and that it has been liquidated) must be notified to the tax office within 30 days and to the Social Insurance Agency and the health insurance company (if the company has employees) within 8 days.
- Preparing extraordinary financial statements as of the date preceding the date of going into liquidation.
- Drawing up a liquidation balance sheet as of the date the company goes into liquidation and sending an overview of the company’s assets to every member who requests this.
- Realising assets, satisfying creditors, drawing up liquidation documents, distributing and paying out the liquidation balance (or depositing the liquidation balance in a custodial account).
Note:
Effective from 1 October 2020, significant changes are to occur in the process of liquidation as well as its subsequent registration in the Commercial Register. The first change concerns the requirement to make an advance for liquidation and the second consists in submitting applications for registration in the Commercial Register in electronic form. As of 1 October 2020, submissions in paper form will no longer be accepted. Changes in applicable court fees also become effective on 1 October 2020. |
Removing a company established for a definite period from the Commercial Register
At the end of the period, the company is dissolved and must approve a decision on going into liquidation and appointment of a liquidator. Therefore, once the amendment to the Commercial Code takes effect on 1 October 2020, if a company established for a definite period does not appoint a liquidator or make an advance payment for liquidation within 60 days of the dissolution of the company, itis considered a company established for an indefinite period.
What documents are required for applying for removal of a company from the Commercial Register?
- decisions of the members or the competent company body on winding up of the company and on its going into liquidation;
- approved financial statements as of the date of completion of the liquidation (profit and loss statement, balance sheet, notes);
- approved final report on the liquidation accompanied with an approved proposal for distribution of the liquidation balance except in the case of a procedure under a special act;
- other document certifying facts under specific legislation;
- in the case of removal of a joint stock company or a simplified joint stock company, the application for removal must be accompanied by documents proving that all paper shares of the joint stock company have been destroyed or declared null and void, or that all book-entry shares of the joint stock company or simplified joint stock company have been cancelled;
- approval of the tax administrator, i.e. approval of the tax or customs office (approval of the municipality is not required);
- approval of the Social Insurance Agency is not required, unless the company is included in the list of the Agency’s debtors.
Fees
A court fee of EUR 66 applies for filing an application to register the company’s going into liquidation in paper form and a fee of EUR 33 for an electronic filing. Administrative fee for issuing an approval of the company’s removal from the Commercial Register is EUR 9.50 (EUR 4.50, if submitted electronically). An application for removal of a company from the Commercial Register is exempt from any fees.
Note:
Effective from 1 October 2020, significant changes are to occur in the process of liquidation as well as its subsequent registration in the Commercial Register. As of that date, only electronic submission of applications for registration in the Commercial Register will be accepted (i.e. as of 1 October 2020, submissions in paper form will no longer be accepted), changes in applicable court fees will also take effect. Furthermore, as of 1 October 2020, the tax administrator’s approval under a special act will no longer be required for the application for the removal of the company from the Commercial Register. Instead, a written declaration of the company’s liquidator that there are no tax arrears or that a tax inspection has been completed, with the authenticated signature of the liquidator, is required. |
Assistance
2. Insolvency proceedings
In particular, insolvency proceedings are intended for bankrupt debtors who are insolvent or in excessive indebtedness, as well as for the debtors’ creditors. This information provides a basic overview of handling of debtors’ bankruptcies by realising their assets and collectively satisfying debtors’ creditors or gradually satisfying creditors based on an approved restructuring plan. It also applies to addressing situations where debtors are at risk of going bankrupt and debt discharge in the case of natural persons. The following courts have jurisdiction in bankruptcy and restructuring proceedings: District Courts – Bratislava I, Trnava, Trenčín, Nitra, Žilina, Banská Bystrica, Prešov, Košice I.
A party must be represented by a lawyer in disputes arising from or related to a bankruptcy or restructuring. This does not apply if the party is a natural person with legal qualifications (higher education, second level), the party is a legal entity and its employee or a member acting on its behalf has legal qualifications (higher education, second level).
Bankruptcy proceedings
Authorised to submit an application for bankruptcy are debtors, creditors, liquidators on behalf of the debtor or another person as provided by law.
The application must include:
The application must include the general formalities. The applicant’s signature must be authenticated, the application must be submitted in two copies. When the application is submitted by a creditor, it must include the facts from which it can be reasonably assumed that the debtor is insolvent, and identify the creditor’s claim as well as another creditor with a claim. Creditors are required to attach all documents proving their claims.
Debtors are required to attach a list of their assets, their liabilities and related parties. If debtors keep accounts under a special act, they must provide the latest statutory individual financial statements together with extraordinary individual financial statements, if applicable.
Applicants must document claims with:
- written acknowledgement by the debtor;
- an enforceable decision or another document, based on which the enforcement of the decision is to be ordered or executed;
- confirmation of the auditor, trustee, or judicial expert;
- confirmation of the Ministry of Finance of the Slovak Republic on existence of a claim by the State related to a contribution provided to the debtor from European Union funds; or
- written declaration with authenticated signatures of at least five employees or former employees of the debtor, who are not related persons, on failure to fulfil their wage claim, severance allowance or discharge benefit 30 days past the due date.
Before filing a petition for bankruptcy, the applicant must pay an advance payment to the court’s bank account.
Restructuring proceedings
Authorised to file the petition are debtors and creditors. The petition for authorisation of restructuring must include the general formalities. The petitioner’s signature must be authenticated.
The petitioner must provide the following with the petition:
- opinion of the trustee;
- list of the debtor’s assets;
- list of the debtor’s liabilities;
- list of persons related to the debtor;
- list of legal acts executed by the debtor with related persons over the last 2 years in the amounts provided by law;
- the latest statutory individual financial statements of the debtor together with extraordinary individual financial statements, if applicable.
The creditor must attach an authenticated declaration that the debtor is insolvent and consent regarding the filing of a petition for authorisation of restructuring.
Discharge of debt
Debtors may seek the discharge of debt in the form of bankruptcy or repayment plan. Debtors are entitled to file an application for debt discharge only if they are subject to execution proceedings or similar enforcement proceedings; in the case of a petition for bankruptcy, this is not possible earlier than 1 year after the issue of an execution order or similar enforcement order. The debtor is required to provide a declaration of insolvency with the application.
For the role in the proceedings for debt discharge, the trustee is entitled to a flat-rate fee and compensation for costs incurred in connection with the proceedings of EUR 500 in total. The debtor has the right to receive legal aid upon request addressed to the Centre for Legal Aid, subject to meeting the conditions defined by law.
A. Bankruptcy
Petitions for bankruptcy are to be submitted electronically. In addition to the general formalities, a petition for bankruptcy is to include:
- the debtor’s CV;
- list of persons related to the debtor;
- list of current assets and list of assets of greater value;
- list of creditors;
- the debtor’s declaration of insolvency;
- a document confirming that the debtor is subject to execution proceedings or similar enforcement proceedings.
When filing a petition for bankruptcy/petition for setting up a repayment plan, debtors must be represented by the Centre for Legal Aid or a lawyer appointed by the Centre for Legal Aid.
B. Repayment plan
The application for setting up a repayment plan is submitted electronically. It should include:
- the debtor’s CV;
- list of related persons;
- list of current assets and list of assets of greater value;
- list of liabilities;
- overview of past revenues and expenditures;
- overview of estimated expenditures and revenues;
- the last five tax returns;
- the debtor’s declaration of insolvency;
- a document confirming that the debtor is subject to execution proceedings/similar enforcement proceedings;
- the debtor’s bank account details;
- information on the residential building administrator/identification data of the association of property owners.
When filing a petition for setting up a repayment plan, debtors must be represented by the Centre for Legal Aid or a lawyer appointed by the Centre for Legal Aid.
Assistance
Last modified: 22. 2. 2021
Publication date: 7. 10. 2020