Can a company be sold (liquidated) during the war in Ukraine?

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Unfortunately, the war had a particularly adverse impact on business, which in many cases became unprofitable. Companies, especially those with foreign shareholders, were no longer profitable and no longer fulfilled their functions. Owners have no choice but to liquidate the company or try to sell it in order to raise some money.

In our article lawyers will tell you how to properly organize the liquidation of a company under martial law.

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How to sell a company, including through an alternative liquidation procedure in time of war?

The liquidation procedure is quite a long process, which often takes years. The best solution is “alternative” liquidation, which we have mentioned repeatedly.

The procedure consists of two stages. First, you need to formalize the purchase and sale of shares in the authorized share capital of a limited liability company with a notary. You must also certify the act of transfer and acceptance with the notary. Prior to the war, this document was drawn up in a notarial form. Now it can be executed on an ordinary sheet, but notarization still remains a must.

The purchase and sale agreement shall be notarized only at will. Usually it is executed in a simple form, rather than notarial form.

Please note! Not all notaries work during the war.

Even from the very beginning of hostilities, a register of notaries working during the war was prepared. Notaries had to be included there. We add a link to this list, as it may be useful: https://notar.npu.ua/.

The second stage in the alternative liquidation procedure is change of management, if necessary. If the director was one of the foreigners who also wants to leave the company, then the appropriate decision is needed. This decision shall also be certified by a notary.

If foreigners do not have the possibility to come to Ukraine personally to certify necessary documents (and in the time of war even if they have possibility, they will hardly have desire), we can offer to issue power of attorney to our employees, who will take appropriate actions on behalf of foreign shareholders. The power of attorney is drafted by our specialists. Foreign shareholders will need to have it notarized and certified according to international treaties between our states (in most cases it must be apostilled).

Here it is worth remembering that the power of attorney for signing the act of acceptance and transfer of the share is valid for two months from the moment of its issuance. Moreover, it does not depend on the validity period specified in the power of attorney itself (unless, of course, it is specified that it is valid for a period of one month). That is, it looks like this: even if the power of attorney is valid for three years, it must still be used within two months from the date of issue. Therefore, it makes sense to send it to Ukraine immediately after certification. 

You also need to remember that it takes a few days here in Ukraine to translate the power of attorney into Ukrainian. But our company can take care of this, because we cooperate with translators who need no more than two working days for this.

You may also like: Liquidation of a Foreign Company’s Representative Office: Procedure and Documents

What other difficulties may arise during the liquidation of the company?

During the war, registration actions are not carried out in all those bodies where this procedure was carried out earlier. Before the war, it was possible to submit documents to any administrative services center of the territorial unit where the company is registered, or to any private notary engaged in registration activities (and there were quite a few of them).

For some time, documents were accepted by individual regional justice departments and some centers for the provision of administrative services, where the reception was scheduled a month in advance. Now, in regions where the situation is more or less stable, registration actions can again be carried out by private notaries.

Despite all the complexities of the process and the state of war in the country, our specialists will help solve your issue as quickly and efficiently as possible.

If you want to liquidate a company in Ukraine safely and as soon as possible, contact us.

Didn’t find an answer to your question?

Everything about liquidation of the foreign company’s representative office in Ukraine here.

Publication date: 27/05/2022

About author

Name: Marina Losenko

Position: Associate

Education: National Aviation University

Knowledge of languages: Russian, Ukrainian

Email: [email protected]

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