The business closure of a LLC (limited liability companies)
To dissolve a LLC, some laws must be observed. It is similar to the dissolution of a stock corporation. The difference is that here the dissolution does not have to be decided by the general meeting, but by the shareholders’ meeting. This decision must be publicly authenticated by a notary.
Reasons for the business closure of the LLC
There can be various reasons for the business closure. A common reason is the economic situation of the LLC, that simply too little profit is generated. But also the opening of a bankruptcy can be responsible for the establishment, or it can already be specified in the statutes, under which conditions the LLC is to be given up. Under certain conditions, even the business closure can be prescribed by law.
What happens during the liquidation?
If the shareholders’ meeting resolves the dissolution of the limited liability company with at least two thirds of the votes, this enters the liquidation stage. If no official liquidators have been elected, the management or a person previously specified in the statute has the task of carrying out the liquidation. It is important that at least one of the liquidators has a residence in Switzerland and has the correction for representation. The liquidators must be registered in the commercial register. Liquidators who are not appointed by the court can be recalled at any time by the shareholders’ meeting. During the liquidation, the LLC remains fully legal and able to act, but only as far as their actions are conducive to liquidation.
Duties and obligations of the LLC during the liquidation
Before a LLC can be dissolved, the resolution must be passed by the shareholders’ meeting. This decision must be certified in public and entered in the Commercial Register. Only then does the LLC become a LLC in liquidation. The liquidators have the task to carry out the dissolution and must report to the shareholders’ meeting. The fact that the LLC is in the resolution must be visible in the company name by a corresponding note. Only when the LLC is completely dissolved, it will be deleted from the commercial register. With this formal act she officially ends her activity.
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Storage of documents
As with all other forms of business, the LLC also has regulations for the storage of the most important documents. This does not only apply to the type of documents, but also to the duration of storage. Most documents have a retention period of ten years. Different is the requirement for storage. Management and accounting documents must be kept either in writing, electronically or in a comparable form. It is important that the files and documents must be legible at all times or made legible. Vouchers that were a reason for entry in the master share book must also be kept.
For them, they must either have a qualified electronic signature or be signed on paper in the original. For revision documents and business documents, the legislator provides for storage as an electronic file with a correspondingly qualified signature or as an original document with signature. The legislator stipulates that the directories of the cooperative and the master share book, as well as annual reports, must be accessible at all times. The documents must be kept securely in the place where it is determined by the liquidators or the competent commercial register office. For all documents, the retention period begins at the end of the current financial year.
What is the liquidation?
The tasks in the dissolution of a LLC (limited liability companies, in German GmbH) are very versatile. Not only must the assets be liquidated, but also the repayment of debts must be organized. A liquidation can take up to two years and involves numerous costs. During the entire dissolution, the responsibility lies with the liquidators over the assets and the liquidation. You have to complete unfinished business as it was agreed with the current LLC. Contracts must be adhered to the end. Until complete deletion from the commercial register, the liquidators must represent the company in all legal transactions that belong to the liquidation of the LLC. If necessary, they can enter into new business, conclude settlements and arbitration agreements or conduct necessary processes.
Another task of the liquidators is the balance sheet, which they have to create with deadline of the dissolution of the LLC. In this way, it should be ensured that the corporate assets of the company are correctly identified at the time of dissolution. If the dissolution of the limited liability company extends over a longer period of time, interim financial statements must be prepared.
Following this, all creditors of the company must be notified. This also applies to unknown creditors. In order to find these, a public debt call must be made three times in the Swiss commercial office SHAB. The creditors then have the possibility to register their claims until the distribution of the company assets. If this does not happen, the amount due to them must be deposited in court. The same applies to liabilities of the Company which are not yet due or in dispute.
Shell company sale as a better alternative
A much cheaper and faster alternative is the sale as a shell company. Compared to the liquidation of a limited liability company, this process is relatively simple and you can also make a profit by selling the company. When a shell company sales only the legal form of the LLC is sold without any assets such as cars or inventory. For you as a salesman this sale brings beside the financial profit also an enormous time saving.