Company liquidation in Azerbaijan
- Emil Khudiyev (Lawyer)
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Have you opened a company, but did not calculate your strength and the project did not pay off, and now you are forced to close the company and cease operations in Azerbaijan?
Now you are faced with an incomprehensible and contentedly long procedure for liquidating a company. And what a frightening word – “liquidation” … What to do with it? Where to apply? Where to begin? Of course, there are more questions than answers. The help of a lawyer in the liquidation of the company is most welcome, so as not to mess things up and run into unnecessary fines.
So how is it right to liquidate (close) a company in Azerbaijan and carry out this whole procedure? I’ll tell you in order…
What is company liquidation?
Company liquidation in Azerbaijan – procedure of complete termination of the company’s activities with the subsequent closure of corporate bank accounts, full settlement of debitor & creditor debts for the final elimination of information about the taxpayer from the state register of legal entities.
Process of liquidation of a company in Azerbaijan is regulated by the provisions of the Civil Code, the Tax Code, as well as the Law on State Registration and State Register of Legal Entities and the Rules for Cancellation of State Registration of Commercial Organizations and Taxpayers.
Procedure of company liquidation in Azerbaijan
1. The executive body of the company accepts an official statement confirming solvency.
2. The participants of the company or the authorized body of the company make a decision on liquidation and by this decision appoint a liquidation commission (or a liquidator).
3. Liquidation commission (liquidator):
– publishes the initial information on the procedure and terms of liquidation of the company and the statement of creditors’ claims. This information should be published in the same way 2 more times;
– submits a decision on liquidation, an official statement confirming solvency, a document confirming the publication of the first information and a company stamp to the Tax Service of Azerbaijan;
– notifies all known creditors about the liquidation of the company, applies to the Ministry of Finance of Azerbaijan to determine the presence of debt.
4. Upon the expiration of the period for presenting creditors’ claims, an interim liquidation balance sheet shall be drawn up by the liquidation commission (liquidator) and approved by the company’s participants.
5. After the completion of the settlements, the act drawn up by the liquidation commission (liquidator) reflecting the liquidation balance sheet and the plan for the division of the remaining property between the participants is approved by the participants of the company or a body authorized to do so by the charter.
6. After the approval of the liquidation balance sheet, the remaining property is distributed among the participants of the company in accordance with the division plan.
7. After the division of the remaining property, the liquidation commission (liquidator) submits the liquidation balance sheet, a report, a document confirming the transfer of property to the participants, the original of the technical passport and charter and a stamp to the Tax Service of Azerbaijan.
8. The liquidation of a legal entity is considered completed from the moment, when relevant information is entered in the state register of legal entities.
Documents required for company liquidation
Liquidation commission (liquidator) within 15 days from the date of appointment, must submit to the tax authority the following documents of the legal entity:
1) Application form;
2) Decision on liqudation;
3) Official statement (declaration) confirming solvency of the company;
4) Document confirming the publication in media of the information on the procedure and terms for the liquidation of a legal entity and notification of creditors’ claims (at least 60 days);
5) Company stamp.
If the company is declared bankrupt, the tax authority must be provided with a court decision on declaring it bankrupt or a decision of the initial meeting of creditors on declaring the debtor bankrupt.
To exclude a company from the state register of legal entities in Azerbaijan, the liquidation commission (liquidator), must submit the following documents within 10 days after the division or use of the remaining property to the Tax Service of Azerbaijan:
1. Liquidation balance;
2. Report on the plan for the division (use) of the remaining property and a document confirming the presentation of property to the participants (act confirming the final settlement with the participants; account statement confirming the deposit of the amount allocated to the participant opened in the bank in his name; payment order and other payment documents);
3. The original of the registration certificate and the charter (regulations) of the legal entity, seal (with the inscription “in the process of liquidation”);
4. For joint-stock companies – a certificate from the National Depository Center of the Republic of Azerbaijan on the exclusion of shares from register. If the submitted documents comply with the requirements of the law, the tax authorities ensure that the company is excluded from the state register within 7 days.
FAQ
How to liquidate a branch / representative office in Azerbaijan?
Liquidating a branch or representative office of a foreign company, the same rules are applied as for liquidating local company.
What is terms for liquidation of the company
Total duration of the liquidation process should not exceed 1 year from the date of entering information on the process of liquidation of a company in the state register of legal entities. If this period expires, the liquidation process starts again.
Is it possible to start process of liquidation of company by issuing a power of attorney?
Yes. To proceeds with this procedure, we will draw up a text of the power of attorney and submit it to you for notarization.
How EMZE can help you?
Just finished reading this article, but still not sure that you can start and go through the process of liquidation a company in Azerbaijan yourself? No problem! I am always ready to provide you with legal assistance, advise you on the liquidation of a company in Azerbaijan and help you at all stages of this procedure.
Need a Lawyer in Azerbaijan? Just Call Emil!
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