Summary of liquidation proceedings

[Lead]There are many cases in the life cycle of a company when the owners decide to terminate the operation of the company. There are several ways to terminate a company in Hungary. In this article we highlight the most common way of termination: The liquidation proceeding.[/lead]

1. Attorney’s preparation at the initiation of the proceedings

1.1. The decision of the supreme body on the
termination of the company without succession, or
determination of the starting date of the winding up
appointment of the liquidator and the determination of the remuneration
future of legal entities with the involvement of the company
information of workers on the liquidation

1.2. Notification of the authorities – within 15 days following publication, the liquidator notifies the
real estate supervisory authority
agencies maintaining authentic records of the company’s assets
competent customs authority, state tax authority, pension funds, certification authority
government employment office competent for the area
competent environmental protection agency
all financial institutions where the company has bank accounts
authority or court hearing any pending proceedings opened against or by the company

1.3. Publication (initialisation) of the liquidation
the Company Court publishes it, within 15 days following the making of the decision, with the sending of the amendment notification
Related task:
publication of the creditors claim(s) within 40 days following the publication, the making of the list of receivables, and
submission of the list to the Courts of Registry, and the notification of the creditors of disputed claims

2. Attorney’s preparation at the termination of the liquidation

2.1. Decision of the supreme body on the
approval of the above mentioned
distribution of assets, the date of delivery of the distributed assets. Note: the liquidation may not be concluded as long as the company has any known claim or debt that has not been addressed in the distribution of assets.
storage and safeguarding of the complete company’s documents of operation
dismissal, remuneration and costs of the liquidator
declaration of the termination of the company without succession (adding, that the company shall be deemed terminated upon being stricken from the companies register)

2.2. The liquidator makes further statements on:
assignments and any transfer of liabilities
official or legal proceedings
storage of the company’s documents
undertaking of the enforcement of the distribution of assets

2.3. Submission of the request of cancellation and its annexes to the Courts of Registry

2.4. Liquidator shall ensure the enforcement of the distribution of assets, but only after when the order concerning the termination of the company has been made

3. Accountant’s preparation

3.1. A request for the delivery of the verification of the national pension insurance fund and the national tax authority about the information of the persons insured by the company.

3.2. Closing report and tax returns
Within 45 days following the starting date the
a report for closing out the company’s accounts, the preparation and submission of the related tax returns information of the receiver concerning all ongoing matters
must be prepared.

3.3. The opening balance sheet of liquidation
shall be prepared within 45 days following the starting date
shall asses the company’s financial position and compile a tracking of claims

3.4. The followings shall be prepared and submitted to the supreme body for the conclusion of the liquidation:
tax returns
the closing balance sheet (report) according to the Accounting Act
a proposal for the distribution of assets, containing a proposal for the fee of the receiver as well
a summary report (closing statement) on the economic events that took place during the period of dissolution proceedings
a proposal for the future of legal entities in which the company maintains a financial interest

Are you in interested in liquidationg a company in Hungary? We, as a Hungarian Budapest based law firm (ügyvédi iroda) can assist you.

Dobos István attorney at law (ügyvéd; Budapest)

E: dobos@doboslegal.eu

Phone / Whatsapp: +36303088151

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