Liquidation of enterprises in Germany

Voluntary company liquidation procedures

The shareholders of a company may agree on the dissolution of the business by their decision. At least 8 quarters of the votes at a general meeting are required for such a resolution. Within a company liquidation, the responsible persons proceed according to the following algorithm: 

• preparation of the Decision on closing a company with the reason for dissolution and notarization;
• sending a notification to the German Commercial Register;
• termination of customer contracts;
• preparation of the termination of employees according to the working contracts;
• preparation and termination of contracts for services received by the company: rental of office space, communication services, banking services and others;
• control of the registration of the dissolution in the Commercial Registry. 

When closing the company, it is necessary to perform all of the above items step by step. It will help the owner to maintain an impeccable business reputation and avoid problems with German law. The company liquidation process is completed when the company has ceased all activities and has been removed from the commercial register. This usually takes at least 12 months.

Dissolution, liquidation, and termination of a GmbH: What documents are required

You should contact the company liquidation service in Germany to be able to do this successfully. Its specialists will help to prepare a package of necessary documents: 

• a copy of the list of founders;
• a copy of the foundation agreement;
• an up-to-date extract from the commercial register;
• copies of annual reports for the last three years;
• a copy of the contract for the office of the company;
• Summe and Salden mit Debitoren/Kreditorenliste;
• contact details of the director, founders and accountant, copies of their passports;
• details of the bank that serviced the firm;
• additional information useful for the audit of the company.

Company liquidation can last more than a year, because the removal from the commercial register is not carried out earlier than a year after the first notification to creditors. And in some cases, it lasts even longer.

Compulsory liquidation in Germany

The company is often unable to pay its debts and is in a deplorable situation. Then, the creditors can start a forced termination of a GmbH. 

To do this, they go to the High Court and report that the company owes them a certain amount, but cannot pay it. This procedure is similar to a voluntary one, but a liquidator is appointed by the court and oversees the whole process.

There is also another procedure, CVL, which differs from compulsory liquidation in that the directors of the insolvent company choose and appoint an insolvency administrator themselves.

During company liquidation, there is active work with the accountants for the proper distribution of the company’s remaining assets among the creditors. You can contact a company liquidation service in Germany for this, which will help you to prepare reports and other financial documents according to German law. 

The main advantage of contacting such an organization will be the comfort of all participants in the process. The help of its employees is useful because the service will undertake the execution of documents and the conduct of the entire process up to the winding up and removal of the company from the Commercial Register. This means that it will save the participants time, nerves and money.