How does an ordinary liquidation procedure work?

By 7 September, 2018October 8th, 2018No Comments

Under Dutch law a company can be wound-up voluntarily by signing a resolution to that effect by the general meeting of shareholders of the company. The shareholders will also file a notice of winding-up with the trade registry. As a rule, the winding-up is followed by the liquidation of the estate of the dissolved company. The members(s) of the company’s board of directors will act as liquidator(s), unless the general meeting of shareholders chooses the appoint a different liquidator. The dissolved Company only continues to exist to the extent the liquidation of its assets so requires. In documents and announcements issued by the company, the words ‘in liquidatie’ (in liquidation) must be added as a suffix to its corporate name, so that it is clear to the public that the legal entity is in liquidation and that the scope of the company’s objectives has to be assessed in this light. After the company has been wound up, a document retention period of seven years applies with respect to the books, records and other data. The custodian (bewaarder) shall be the party designated in the articles of association or by a resolution of the general meeting of shareholders. The liquidation will end after conversion of the fixed assets into liquid assets, collection of all claims and payment of all debts. A possible remaining credit balance will be at the disposal of the shareholders for distribution. The last steps are to file the “account of liquidation” and “plan of distribution” with the trade registry and to inform the trade registry of the liquidation.

Services provided by KC Legal

  • Preparation and filing of the notice of winding up with the trade registry;
  • Appointing the liquidator of the dissolved company of your choice (not being KC Legal);
  • Acting as custodian;
  • Advising the shareholders on the disposal/distribution of remaining assets;
  • Preparing and filing the account of liquidation with the trade registry;
  • Preparing and filing the plan of distribution with the trade registry;
  • Preparing and filing the final corporate income tax returns;
  • Drafting shareholders resolution for liquidating the company;
  • Arrange for publication of the resolution to liquidate the company in a national newspaper;
  • Request for deed of non-objection from the Dutch courts.