Order of liquidation or deregistration of a limited liability company

The registration authority, i.e. the Finnish Patent and Registration Office (PRH), may order a limited liability company into liquidation or to be deregistered (Chapter 20, Section 4 of the Limited Liability Companies Act). The process may be initiated by filing an application (read more below), or by the PRH on its own initiative (Chapter 20, Section 6 of the Limited Liability Companies Act).

Grounds

A limited liability company may be ordered into liquidation or to be deregistered if

  • the company has no registered and competent Board of Directors
  • the company has no registered representative as referred to in Section 6 of the Act on the Right to Carry on a Trade (122/1919; laki elinkeinon harjoittamisen oikeudesta)
  • regardless of an invitation by the registration authority, the company has not submitted its financial statements for registration within one year from the end of the financial period, as required in Chapter 8, Section 10 of the Limited Liability Companies Act, or
  • the company has been declared bankrupt, but the bankruptcy has lapsed due to lack of funds.

The order must be issued, unless it is proved before the issue of the order that the grounds for it no longer exist.

Application

An application concerning the liquidation or deregistration of the company may be filed by the Board of Directors, a member of the Board of Directors, the Managing Director, an auditor, a shareholder, a creditor or anyone whose rights may depend on appropriate registration or the placing of the company into liquidation.

Contents and enclosures

  • Written, informal application to the PRH, requesting the company to be ordered into liquidation or to be deregistered.
  • State the grounds for the request.
  • If the application concerns the liquidation of a company, we recommend that you, as the applicant, inform us in the application if you undertake to bear the liquidation costs and nominate a person as liquidator.
  • The applicant or a person he or she has authorised signs the application. If an authorised person signs the application, the original general power of attorney or a certified copy of a special power of attorney must be enclosed.
  • The handling fee is 210 euros (must be paid in advance, see payment instructions). An application based on a bankruptcy that has lapsed is free of charge.

PRH’s procedure

If the procedure has been started due to other reasons than lapse of bankruptcy, the registration authority, i.e. the PRH, will request the company to correct the deficiencies in its registered details. If no correction is made, the PRH sends an invitation to the company in writing.

The written invitation states that the company will be ordered into liquidation or deregistered unless the deficiencies are corrected by the deadline. The written invitation is published in the Official Journal no later than three months before the deadline. At the same time, the shareholders and creditors who wish to make comments on the liquidation or deregistration of the company will be requested to do so in writing by the deadline.

An entry of the invitation published in the Official Journal will be made in the Trade Register. The matter may be decided upon by the PRH even if no proof is available of the company having received the invitation.

Liquidation or deregistration

The company will be placed into liquidation or deregistered unless the deficiencies in its registered details are corrected by the deadline. The company will be ordered into liquidation only if its assets are adequate for covering the costs of liquidation or if someone undertakes to bear the costs.

If the company is ordered into liquidation, the liquidation proceedings are almost the same as in liquidations based on a General Meeting decision, but an entry stating that the liquidation proceedings have begun will automatically be made in the Trade Register.

Effects of deregistration

Deregistration takes effect upon registration. If necessary, a deregistered company may be represented by one or several representatives appointed in a shareholders’ meeting. Once deregistered, the company cannot acquire rights nor give undertakings. The representatives may however take measures necessary for the repayment of the company’s debts or the preservation of the value of the company’s assets.

Please note that the assets of the company cannot be distributed without liquidation. However, in five years from the deregistration, the representatives may distribute the assets of the company to parties entitled to shares in the distribution, if the assets do not exceed 8,000 euros and if the company has no known creditors. Those receiving assets are liable for the payment of the debts of the company up to the amount that they have received. (Read more in Chapter 20, Section 20–22 of the Limited Liability Companies Act in Finlex Data Bank.)

How to apply for liquidation of a deregistered limited liability company

If liquidation measures are needed after deregistration, the registration authority orders the company into liquidation on the application of the party to whose rights the matter pertains (Chapter 20, Section 22 of the Limited Liability Companies Act). However, no such order will be issued, if the assets of the company are not adequate for covering the costs of liquidation or there is no information on the assets, and if no shareholder, creditor or other party undertakes to bear the liquidation costs.

Application

  • Written, informal application to the PRH, requesting the deregistered company to be ordered into liquidation.
  • We recommend that you, as the applicant, inform us in the application if you undertake to bear the liquidation costs and nominate a person as liquidator. If you nominate a person as liquidator, you must submit his or her consent to the assignment together with the application.
  • State the grounds for the request.
  • If necessary, give an account of the financial position of the company.
  • The applicant or a person he or she has authorised signs the application. If an authorised person signs the application, the original general power of attorney or a certified copy of a special power of attorney must be enclosed.
  • The handling fee is 85 euros (must be paid in advance, see payment instructions).

Deregistration under the old Companies Act

If a limited liability company has been removed from the Trade Register as set out in the old Companies Act (734/1978), that act will be applied to such company (Chapter 13 of the old Companies Act). The current Limited Liability Companies Act (624/2006) does not affect the validity of deregistrations carried out under the old act.

Deregistration under Section 24 of the Trade Register Act

The registration authority may on its own initiative start a deregistration procedure if no notification has been received by the Trade Register from a company over the last ten years and there are grounds to assume that the company has closed down its business.

Please note

  • Chapter 20, Section 9(3) of the Limited Liability Companies Act applies to situations where a company in liquidation does not have a liquidator. In such case, the application procedure may result in appointing a liquidator for the company or the company being removed from the register.
  • Chapter 23, Section 2 of the Limited Liability Companies Act applies to situations where a court issues an order of liquidation or deregistration of a company.
  • If the bankruptcy has lapsed due to insufficient assets, the registration authority will automatically remove the company from the Trade Register, as soon as it has received a notification about the lapse from the court. This does not however apply to bankruptcies that have lapsed before 1 April 2001.
  • Section 21 of the Act on the Implementation of the Limited Liability Companies Act (625/2006; laki osakeyhtiölain voimaanpanosta) contains a transitional provision for dissolution of companies.
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Latest update 09.01.2014