Under the Act of August 10 2016 modernising the Company Law 1915 (which entered into force on August 23 2016) Luxembourg law now officially recognises that companies can be wound up by means of a simplified procedure. This is an unquestionably useful tool which will further enhance Luxembourg's business-friendly reputation.
Pursuant to Article 141 of the Company Law 1915 on commercial companies, as amended by the new act and Article 1865bis of the Civil Code, a company with a sole shareholder can be dissolved without liquidation pursuant to a resolution adopted by the shareholder. In such cases, all of the company's assets and liabilities will be transferred to the shareholder by operation of law. Creditors will have 30 days from the date on which the decision to wind up is published to petition the district court president for additional security.
This new means of winding up is a faster and cheaper alternative for single shareholder companies to the traditional three-step liquidation procedure, which required three shareholder meetings and the appointment of a liquidator and an auditor. Although a simplified procedure had previously existed in notarial practice, it lacked a clear legal basis.
In practice, the new procedure requires the issuance of three certificates by various administrative bodies in order to ascertain that the company is in compliance with its obligations regarding the payment of taxes and social security contributions.
For further information on this topic please contact Greet Wilkenhuysen, Romain Sabatier or Yoanna Stefanova at NautaDutilh Avocats Luxembourg Sàrl by telephone (+352 26 12 29 1) or email ([email protected], [email protected] or [email protected]). The NautaDutilh Avocats Luxembourg Sàrl website can be accessed at www.nautadutilh.com.
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