Order and Procedures for Dissolving a Single-Member LLC under a Court Decision

How is the dissolution of a single-member limited liability company under a Court decision carried out? Within how long from the date of receipt of the Court’s dissolution decision must the company submit the dissolution dossier?

1. What is the order and procedure for dissolving a single-member limited liability company under a Court decision?

Article 209 of the Law on Enterprises 2020 regulates the dissolution of an enterprise in cases of revocation of the enterprise registration certificate or under a Court decision, as follows:

The dissolution of an enterprise in cases of revocation of the enterprise registration certificate or under a Court decision shall be carried out in the following order and procedures:

– The business registration authority must announce the enterprise’s status of undergoing dissolution procedures on the National Portal on Enterprise Registration at the same time as issuing the decision to revoke the enterprise registration certificate, or immediately after receiving the Court’s dissolution decision that has taken legal effect. The announcement must be accompanied by the decision to revoke the enterprise registration certificate or the Court’s decision that has taken legal effect;

– Within 10 days from the date of receipt of the decision to revoke the enterprise registration certificate or the Court’s decision that has taken legal effect, the enterprise must convene a meeting to decide on the dissolution. The dissolution resolution or decision and a copy of the decision to revoke the enterprise registration certificate or the Court’s decision that has taken legal effect must be sent to the business registration authority, the tax authority, and the employees of the enterprise, and must be publicly posted at the head office, branches and representative offices of the enterprise. Where the law requires newspaper publication, the enterprise’s dissolution resolution or decision must be published in at least one printed or electronic newspaper in 03 consecutive issues.

Where the enterprise still has unpaid financial obligations, it must at the same time send to creditors and persons with related rights and obligations, together with the enterprise’s dissolution resolution or decision, a debt settlement plan. The notice must contain the creditor’s name and address; the debt amount, time limit, place and method of payment of such debt; and the manner and time limit for resolving creditors’ complaints;

– The payment of the enterprise’s debts shall be carried out in accordance with Clause 5, Article 208 of this Law;

– The enterprise’s legal representative shall submit the enterprise dissolution dossier to the business registration authority within 05 working days from the date of full payment of all the enterprise’s debts;

– After 180 days from the date of announcement of the enterprise’s status of undergoing dissolution procedures under Clause 1 of this Article without receiving a written objection from any related party, or within 05 working days from the date of receipt of the dissolution dossier, the business registration authority shall update the legal status of the enterprise on the National Database on Enterprise Registration;

– Relevant company managers shall bear personal liability for damage caused by failure to comply or improper compliance with this Article.

2. What does the dissolution dossier of a single-member limited liability company comprise?

Article 210 of the Law on Enterprises 2020 provides as follows:

“Article 210. Enterprise dissolution dossiers

1. An enterprise dissolution dossier comprises the following documents:

a) A notice of enterprise dissolution;

b) A report on the liquidation of the enterprise’s assets; a list of creditors and the debts already paid, including full payment of tax debts and debts of social insurance, health insurance and unemployment insurance contributions for employees after the decision on enterprise dissolution (if any).

2. Members of the Board of Directors of a joint-stock company, members of the Members’ Council of a limited liability company, company owners, private enterprise owners, Directors or General Directors, general partners, and legal representatives of the enterprise shall be responsible for the truthfulness and accuracy of the enterprise dissolution dossier.

3. Where the dissolution dossier is inaccurate or forged, the persons specified in Clause 2 of this Article shall be jointly liable for payment of unresolved employee benefits, unpaid taxes and other unpaid debts, and shall bear personal liability before the law for consequences arising within 05 years from the date of submission of the enterprise dissolution dossier to the business registration authority.”

Thus, the dissolution dossier of a single-member limited liability company comprises:

+ A notice of enterprise dissolution;

+ A report on the liquidation of the enterprise’s assets; a list of creditors and the debts already paid, including full payment of tax debts and debts of social insurance, health insurance and unemployment insurance contributions for employees after the decision on enterprise dissolution (if any).

3. Within how long from the date of receipt of the Court’s dissolution decision must the company submit the dissolution dossier?

Clauses 2 and 4, Article 209 of the Law on Enterprises 2020 provide as follows:

“Article 209. Dissolution of an enterprise in cases of revocation of the enterprise registration certificate or under a Court decision

[…]

2. Within 10 days from the date of receipt of the decision to revoke the enterprise registration certificate or the Court’s decision that has taken legal effect, the enterprise must convene a meeting to decide on the dissolution. The dissolution resolution or decision and a copy of the decision to revoke the enterprise registration certificate or the Court’s decision that has taken legal effect must be sent to the business registration authority, the tax authority, and the employees of the enterprise, and must be publicly posted at the head office, branches and representative offices of the enterprise. Where the law requires newspaper publication, the enterprise’s dissolution resolution or decision must be published in at least one printed or electronic newspaper in 03 consecutive issues.

Where the enterprise still has unpaid financial obligations, it must at the same time send to creditors and persons with related rights and obligations, together with the enterprise’s dissolution resolution or decision, a debt settlement plan. The notice must contain the creditor’s name and address; the debt amount, time limit, place and method of payment of such debt; and the manner and time limit for resolving creditors’ complaints;

[…]

4. The enterprise’s legal representative shall submit the enterprise dissolution dossier to the business registration authority within 05 working days from the date of full payment of all the enterprise’s debts;

[…]”

Accordingly, within 10 days from the date of receipt of the Court’s decision that has taken legal effect, your company must convene a meeting to decide on the dissolution. And the company’s legal representative shall submit the enterprise dissolution dossier to the business registration authority within 05 working days from the date of full payment of all the enterprise’s debts.