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Liquidation – how to proceed with the liquidation of a company in Slovakia?

One common question our clients ask is how to proceed with company liquidation. Since liquidation is a complex process, we’ve compiled this article to provide essential information in one place.

If you don’t feel comfortable managing the liquidation process on your own, you can reach out to us, and we’ll guide you through each step. The scope of the service and the price will be negotiated individually. Depending on the agreed scope of the service and the complexity of the disposal, the price ranges from 750 EUR.

In addition to liquidation, we can also advise you on other ways how to get rid of an inactive companysuch as lodging a complaint with the for dissolution of the company with the court (ex officio dissolution of the company) or transfer of the business share to another person

How a Company Enters Liquidation

Liquidation aims to satisfy the claims of creditors and others entitled to the liquidation balance.

The first step is to pass a resolution to dissolve the company and enter liquidation.When shareholders or the relevant company body decide to dissolve the company, they also appoint a liquidator.Entering liquidation also requires a change to the company’s nameto include the suffix“in liquidation.”„.

If a company has only one shareholder, the decision to enter liquidation can be made by the sole shareholder.If there are multiple shareholders, the general meeting decides.

f dissolution wasn’t decided by shareholders or the company’s relevant body, shareholders have a 60-day deadline to appoint a liquidator.The entry of the liquidator into the Commercial Register must be recorded within 90 days.

Who Can Be a Company Liquidator?

A liquidator can be:

  • A person registered as a trustee under specific law (referred to as a "bankruptcy trustee"), or
  • Another person registered in the personal register who agrees to the appointment and is eligible to serve as a member of the company's statutory body.

The partnership agreement, founding agreement, articles of association, or specific legislation may designate the person who is to serve as the liquidator.

If a court appoints the liquidator, it selects them randomly from eligible persons for bankruptcy trusteeduties, even without their consent.

If the liquidator is appointed by shareholders or the company’s relevant body, the appointed liquidator files an entry application into the Commercial Register. If a court appoints the liquidator, the court will automatically record it in the register.

Payment of Liquidation Advance

Notarial custody account. notárskej úschovyThis deposit must be made before the liquidator's entry into the Commercial Register.

The liquidation advance amount is set by the Ministry of Justice Decree No. 193/2020 Coll., which regulates certain provisions of the Commercial Code regarding liquidation. The current amount of the advance is 1,500 EURDeposit is deposited by the liquidating company.

The notary will release the advance to the liquidator who is last registered in the Commercial Register, 30 days after the company’s deletion from the register.

Entry of Liquidation into the Commercial Register

Once the liquidation decision is made and the liquidation advance deposited, a request for entry of liquidation-related changes can be submitted electronically to the Commercial Register. The court fee for registering changes is 33 EUR. The day of registration of the liquidator in the commercial register is also the day of entry into liquidation.

Required attachments for the registration of changes in the Commercial Register are:

  • Decision by the sole shareholder or minutes of the general meeting (depending on the decision-maker),
  • Liquidator’s signature specimen,
  • Record of liquidation advance deposit into notarial custody,
  • Updated company agreement or appendix to the company’s foundation document,
  • Power of attorney in case of submitting by the advokát.

Liquidation and Liquidator's Role

Upon entering liquidation, the company’s statutory authority transfers to the liquidator, except for calling the company’s highest body meetings.

With the start of liquidation, one-sided legal acts, like company orders, mandates, authorizations, and general powers of attorney, are terminated, except for court representation powers.

The liquidator only takes actions related to company liquidation.These include fulfilling company obligations, claiming receivables, accepting payments, representing the company before courts and authorities, settling disputes, and terminating legal relationships. New contracts may be entered only if they relate to concluding existing relationships.

We recommend creating a list of contractual relationships involving the company being liquidated.Some contracts may take time to terminate.

If the liquidator identifies company over-indebtedness, he must promptly file for bankruptcyunless such proceedings have already concluded due to insufficient assets.

Notification of Liquidation to Creditors

The liquidator must immediately notify all known creditors of the company’s liquidation. It is recommended to contact creditors in writing to provide proof if needed.

Notification of Liquidation to the Tax Office

According to § 67 paragraph 9 of Act No. 563/2009 Coll. on Tax Administration, tax entities must report changes related to their registration, including liquidation, to the tax administrator within 30 days of their occurrence.

If the tax subject fails to fulfil the notification obligation properly and on time, the relevant changes in the register shall be made ex officio by the tax administrator as soon as he becomes aware of the relevant facts. Notification of a company's entry into liquidation, change of the company's name, notification of the company's liquidator can be made through the portal of the Tax Administrationthrough the electronic form Application for registration, notification of changes, application for cancellation of registration for income tax, value added tax and insurance tax.

Notification of Liquidation to the Bank

Most companies have a bank account. Although notifying the bank of liquidation isn’t legally required (unless the bank is a creditor), such an obligation may be stipulated in bank contracts. Check with the bank on the agreed procedures in case of liquidation.

Liquidator's Notice Publication in the Commercial Bulletin

The liquidator is obliged to publish a notice of entry into liquidation and an invitation to the company's creditors and other persons and bodies affected to register their claims and other rights in the Commercial Bulletin.

The Commercial Bulletin includes information on liquidation, such as:

  • Liquidator’s name, address, and birthdate,
  • Company’s name, seat, ID, and registration,
  • Resolution passed (by the sole shareholder, general meeting, etc.) and its date,
  • Liquidation start date,
  • Address for claim submissions and name of the responsible person.

Liquidation and List of Claims

The liquidator continuously enters the registered claims in the list of claimsThe basic list of registered claims shall be prepared by the liquidator according to the status as of the date of expiry of 45 days from the publication of the announcement of the company's entry into liquidation. The liquidator shall deposit the list of registered claims in the collection of documents within 30 days of the expiry of the period of 30 days from the date of preparation of the list of registered claims.

Extraordinary Financial Statements

The liquidator shall draw up extraordinary accounts the extraordinary financial statements as at the date preceding the date on which the company enters into liquidation. That is to say, for the period from the filing of the last previous financial statements up to the day preceding the date of registration of the liquidator in the commercial register.

Liquidation and Asset List

Throughout the liquidation, the liquidator shall maintain an inventory of the assetsThe liquidator shall draw up a basic list of the company's assets and deposit it in the register of deeds within the same time limit as the list of registered claims.

The elements of the list of assets are established by a generally binding legal regulation, which is the Decree of the Ministry of Justice of the Slovak Republic No. 193/2020 Coll. implementing certain provisions of the Commercial Code on liquidation. In the annex there is also model list of assets.

The list of assets of the company (hereinafter referred to as the ‘list of assets’) shall list all assets belonging to the company as at the date of the deposit of the list of assets or as at the date of its completion, including disputed assets in respect of which someone else claims ownership or other property right, in the collection of deeds of the commercial register.

Satisfying Claims

The liquidator settles creditor claims progressively. The claim for the liquidation advance return is satisfied before other claims.

If a known creditor doesn’t file their claim and cannot be paid otherwise, the liquidator deposits funds for the creditor’s benefit with a notary.

Company members are not entitled to the liquidation balance share until all known creditor claims are satisfied.

Completion of Liquidation

On the date of the winding-up, but not earlier than six months after the announcement of the company's entry into liquidation, the liquidator shall draw up the inancial statements, a final report on the course of the liquidation and a proposal for the distribution of the liquidation surplus among those entitled to the liquidation surplus. The liquidator shall publish without delay the notice of the drawing up of the accounts, the final report on the winding-up and the proposal for the distribution of the liquidation surplus (notice of the end of the winding-up).

The time limit is extended by a further six months if the liquidator discovers that the company has a tax arrears at the date of the preparation of the financial statements and the final report on the progress of the liquidation, or if the company is subject to a tax audit.

Unless the members or the competent body of the company decide otherwise within 60 days after the publication of the notice of the winding-up, the financial statements, the final report on the course of the winding-up and the proposal for the distribution of the liquidation surplus shall be deemed to have been approved on the expiry of that period.

Upon approval of the accounts, the final report on the winding-up and the proposal for the distribution of the liquidation surplus, the liquidator shall publish a notice to that effect and shall forthwith remit the liquidation surplus to those entitled thereto.

Removal of the Company from the Commercial Register

The next step is to remove the company from the Commercial Register. The application for the cancellation of a company shall be submitted electronically using the form provided for that purposeAttached to the completed form are:

  • Final financial statements covering the liquidation period,
  • The final liquidation report,
  • Liquidation balance distribution proposal,
  • A declaration confirming no tax debts or ongoing audits.

Upon its removal from the register the company ceases to exist..

Removal of the Company from the Commercial Register

Finally, we cannot forget about the company's registry. The registry is the set of all registry records recorded by the originator of the registry. The originator of the registry is a legal entity or natural person from whose activity the registry originates, i.e. also a commercial company. The rights and obligations of the originators of registers are regulated by Act No 395/2002 Coll. on archives and registers and on the amendment of certain acts.

The scope of rights and obligations related to records management depends on the categorization of the record originator—that is, whether they generate records with permanent documentary value. If you are unsure which category your organization belongs to, you may request categorization from the relevant state archive.

If the registry originator ceases to exist without a legal successor (e.g. a commercial company is deleted from the commercial register), the registry originator is obliged to submit without delay to the State Archives a proposal for the disposal of registry records with permanent documentary valueThis also applies to registry records for which the retention period has not yet expired and to hand them over in an orderly manner in accordance with his instructions. Registry records without permanent documentary value must be retained until the expiry of the retention periods

Record originators whose activities do not generate records with permanent documentary value must fulfill their obligations for records retention in accordance with Section 16, paragraph 2 of the Act on Archives and Records Management (with the exception of the obligations listed in paragraph 5 of the same section).

If you didn’t find all the information you need, please reach out to us at office@lidaybasaryova.sk, and we will get back to you.

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