Company Liquidation in Croatia
Company Liquidation in CroatiaUpdated on Wednesday 24th April 2019
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How can a company be liquidated in Croatia?
There are two ways of liquidating a company, through a non-judicial procedure or by bankruptcy procedure with the approval of the Bankruptcy tribunal. The Bankruptcy Law, Obligatory Relations Law, and the Company Law govern the process of liquidation in Croatia.
What are the steps for company liquidation in Croatia?
A company may be liquidated through non-judicial procedure only if there are no claims raised by creditors or no unpaid debts to the providers. This procedure is taken by dividing all the company's assets among the members. The company is then erased from the Commercial Register. A bankruptcy procedure may be initiated with the help of the Bankruptcy tribunal and is started mostly by the creditors that haven’t received a positive answer to the request of covering the claims. The following steps are also part of the company liquidation in Croatia:
- • the parts involved in the process of bankruptcy are the creditors’ committee, the trustee in insolvency, the bankruptcy judge, and tribunal;
- • the balance sheet with all the companies’ assets must be submitted to the authorities;
- • a public auction for the assets will then be organized;
- • the contracts will be settled on behalf of the debtor, and then periodically reports regarding the status of the liquidation process will be elaborated;
- • all the claims will be verified by the creditors, in order to find ways to cover it;
- • new contracts may be signed only if they are in the liquidation’s interest;
- • at the end of the process, the trustee will elaborate a final balance sheet.
Liquidation of an LLC in Croatia
Who supervises the trustee in bankruptcy?
The trustee in bankruptcy is supervised by the creditors' committee, a body appointed by the bankruptcy tribunal. Some of its responsibilities are supervising the liquidation course and checking the company’s books and records. Also, the balance sheet must be checked by this authority. The bankruptcy tribunal is composed of three judges, one of them being president. The tribunal has the power to appoint the trustee and the creditors’ committee and check the availability of the liquidation decision. The activity of the committee of creditors is also verified by the judges of the tribunal.
How long does it take to liquidate a company in Croatia?
Closing down a business may take from a few months (in case of a non-judicial procedure) to several years (when the bankruptcy is declared). It is strongly recommended to solicit the support offered by a legal advisor, in order to properly control the entire company liquidation process.
For more information about liquidating a company, you may contact our law firm in Croatia.