Our lawyers in Cyprus present the company liquidation procedures available in this country. You can rely on us for support for closing a local business.
| Quick Facts | |
|---|---|
| Applicable law(s) | – Company Law Chapter 113, – Civil Code. |
Conditions to liquidate a company | – extraordinary resolution of the shareholders, – over-indebtedness, – termination of activities in Cyprus, – business relocation. |
Types of procedures | Voluntary and mandatory proceedings are available. |
| Voluntary company liquidation | Voluntary company liquidation in Cyprus can be commenced after the shareholders pass a resolution in this sense. |
| Judicial company liquidation | Judicial company liquidation is ruled in court at the request of one or more creditors. |
| Appointment of a liquidator in a voluntary procedure | The liquidator is appointed by the shareholders. |
| Appointment of a liquidator in a mandatory procedure | The liquidator will be appointed by the court of law. |
| Authorities to notify in case of liquidation | – the Companies Register, – the Tax Department in Cyprus. |
| Requirement to notify other parties (YES/NO) | Yes, the creditors, the employees, and other interested parties. |
| Notice requirements | – within 14 days from the adoption of the liquidation decision in the case of voluntary procedures, – within 3 days from the decision of the court in the case of judicial proceedings. |
| Additional accounting requirements to comply with (if any) | Drafting a final financial statement and filing it with the Companies Register. |
| Company liquidation time frame (approx.) | 12 to 18 months. |
| De-registration with the Tax Department in Cyprus required (YES/NO) | Yes. |
| Trade Register deletion requirement (YES/NO) | Yes, after completing the liquidation procedure. |
| Company liquidation support (YES/NO) | Yes, our lawyers in Cyprus can assist with the liquidation of a company. |
Table of Contents
What are the main ways to liquidate a company in Cyprus, and what do they entail?
There are two ways to liquidate a company in Cyprus:
- voluntarily: when the decision is made internally by the shareholders or at the request of the creditors;
- with a court order: when the decision is made by a judge at the request of one or more creditors.
Who can file for company liquidation in Cyprus?
Any of the following:
- the company itself: there are several reasons for a company to choose to terminate its activities;
- a creditor: in this case, the law requires that the company has a debt that is payable towards the creditor;
- a member or shareholder: to be allowed to do that, the respective party must have been a contributor in the company for a minimum period of 6 months in the last 8 months;
- the Official Receiver or the Trade Registry: under special circumstances, such as the company has failed to meet public interest requirements.
Here is also an infographic on this topic:
What does voluntary company liquidation entail?
Voluntary company winding up in Cyprus is possible:
- through a members’ (shareholders) decision;
- through a creditors’ decision.
In order to close a company voluntarily based on the decision of the shareholders, there are a few conditions and steps to complete, namely:
- the company must be able to pay its debts in a maximum timespan of 12 months;
- where a unanimous decision cannot be made, the majority of the shareholders must vote for liquidation;
- the shareholders must also appoint a licensed liquidator to carry out the procedure;
- the liquidator must notify the Companies Register about the liquidation within a maximum of 14 days from the adoption of the resolution.
In the case of a creditors’ company liquidation in Cyprus:
- the directors hold a board meeting through which a resolution for the company’s liquidation is passed;
- following this, the resolution must be approved by the shareholders and the creditors;
- in this type of procedure, the liquidator will report to the creditors on the phases of the process.
Can foreign shareholders request a Cypriot company’s liquidation?
Yes, there are no limitations in this sense.
What are the documents to prepare when voluntarily liquidating a company in Cyprus?
The following:
- the resolution of the shareholders to liquidate the company;
- the company’s audited financial statements;
- a declaration of solvency from the directors;
- the publication of the appointment of the liquidator in the Official Gazette and 2 local newspapers;
- a tax clearance certificate.
What are the steps for court company liquidation in Cyprus?
The compulsory liquidation begins by paying a fee to the Companies Registrar and the Official Receiver before submitting the request to the Court.
The application is set for a hearing in a maximum of 30 days. If during that time no objection is registered, the Court reschedules the application for proof in a maximum of 30 days, while an announcement is made in the Government Gazette and a regional newspaper mentioning the data when the liquidation hearing is appointed.
Any interested party must give 24 hours’ notice to the attorneys of the applicant before making a representation in relation to the application in Court. Any objections are resolved on a specific date appointed by the Court. If there are no complaints, the Court will make a decision within a maximum of 3 days. The Order is submitted to the Companies Registrar and the company.
Here is also a video on company liquidation:
Is there any other way to close a company in Cyprus?
Yes, through strike-off.
What are the requirements to strike off a company from the Cyprus Trade Register?
The following steps must be taken before having a Cypriot company struck off:
- close the bank account;
- pay off any debts;
- have the financial statements audited;
- meet all its tax obligations.
Is it possible to close a dormant company in Cyprus?
Yes, in this case, the strike-off method can be used.
How long does it take to liquidate a company in Cyprus?
The liquidation of a company in Cyprus may take from six months, in case of a voluntary liquidation, to one year, in case of a compulsory decision. The time frame may vary from case to case.
In case you need assistance with the dissolution procedure in other European jurisdictions, we are more than happy to recommend some of our partners, like a law firm in Germany, for instance, with whom we have worked and enjoyed a long and successful collaboration over the years.
If you are interested in the procedures for company liquidation in other countries, such as Portugal and Liechtenstein, we may help you with information from our local partners.
Our lawyers are also at the service of natural persons who can rely on us for legal support in various matters, among which marriage registration in Cyprus. We are also at the disposal of foreign citizens interested in buying properties in Cyprus.
Feel free to contact our Cypriot lawyers for support in company liquidation matters.