In Bulgaria, a business’s liquidation or dissolution may be voluntary when decided by its shareholders or when it is acquired by another entity, or it may be required when the firm is insolvent or when the judgment was made by a Bulgarian court. The Commercial Law of Bulgaria covers the legal procedure for winding up a firm. Businesses might hire a Bulgarian law company to aid with the legalities as several steps must be taken to finish this procedure. Regardless of the circumstances that led to the company’s liquidation, the Bulgarian lawyers can offer support and guidance throughout the entire process.
Bulgarian requirements for company dissolution and liquidation
A competent Bulgarian court or the company’s shareholders must decide to dissolve the business before the liquidation process may commence. Stopping all firm operations is the first step. This stage sees the dissolution of the company. The legal entity must end any continuing business relationships before the assets can be transferred to other parties, hence the corporation must first be dissolved.
A shareholder’s decision leads to the company’s demise. If a majority of the shareholders, those owning three quotas of the capital decide to take this step, it will happen. The corporate management must inform the affected parties of the decision following notifying the Tax Office of the dissolution and the start of liquidation even if the firm is still a valid legal entity in Bulgaria during the liquidation procedure, it is not permitted to conduct any business. After the process is finished, the firm no longer has a legal existence, and the Bulgarian Trade Register no longer lists it.
Clearance of outstanding debts
The resolution of any outstanding debts and claims between the company and any other third parties is the most crucial step in the liquidation process in Bulgaria. To do this, the company’s assets are distributed among the creditors, and any remaining assets (if any) are then distributed among the shareholders. This is a process that occurs outside of court between the company’s partners and the announcing the dissolution and the beginning of liquidation to the Tax Office
The company is not allowed to perform any activity during the liquidation process, even if it is still a legitimate legal entity in Bulgaria. Once the procedure is complete, the company loses its legal status and is no longer listed in the Bulgarian Trade Register. If the company’s insolvency has been noticed, another party may initiate insolvency proceedings against the corporation during the liquidation process.
Appointment of the liquidator
Once the process to dissolve the firm has begun, a liquidator must be appointed. He or she may have served as the organization’s previous management or the Bulgarian Trade Register may have selected him. The liquidator has the right to take all necessary steps to finish the liquidation and represent the business in front of the appropriate authorities. A few of the liquidator’s duties are as follows:
- Put an end to the open deals.
- Recover debts.
- Cash-out cash holdings.
- Complete a balance sheet.
- Lock up the business’s accounts.
During this time, no additional transactions will be made other than those necessary to convert the assets into cash or to complete any other tasks related to the liquidation. The Bulgarian National Revenue Agency issues a liquidation certificate. This liquidation certificate must be filed with the Trade Register along with the shareholder resolution to liquidate the business, the appointment of the liquidator, and a report outlining the specifics of the liquidation process. You can file all the required legal documents with the assistance of Bulgarian attorneys.
Bulgarian company liquidation process to end
All of the company’s creditors must submit claims, according to the corporate liquidator. There is a maximum of six months from the date of the first claim to submit the current claims. To the creditors, information about the liquidation was sent. The liquidator takes the appropriate steps to remove the firm from the Bulgarian Trade Register once all debts have been paid in full and all of the company’s assets have been dispersed.
Depending on the nature of the company and the outstanding claims, the liquidation of a commercial company in Bulgaria shouldn’t take more than six months. The Bulgarian law practice can provide you with full legal support for company dissolution and liquidation.
