How to Liquidate a Non-Governmental Organization in Ukraine?
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We received a request from a Client regarding the fastest and easiest way to liquidate a non-governmental organization. As in most cases the Client was concerned about two aspects - time and cost. The procedure is not simple, it is multistage and takes a very long time to wait for the decisions of state authorities, especially when it comes to de-registration of the NGO.
For example, the appointment of an inspection of a non-governmental organization with the tax authority can take months, if you do not constantly remind the inspector about yourself and do not take measures to speed up the inspection.
It is clear that the liquidation of any form of activity in Ukraine by a professional lawyer is always a time-saving solution in comparison with persons, who carry out such a procedure for the first time. However, when it comes to the liquidation of a non-governmental organization, legal assistance in the procedure becomes a necessity.
We offer NGO liquidation services on a turnkey basis, which means a certain period of liquidation, the minimum participation of the Client in the procedures and agreed cost of the NGO liquidation at the start of our cooperation.
What is the NGO liquidation procedure?
The NGO can at any time make a decision on liquidation, this is also called self-dissolution.
The process of the NGO liquidation begins with the decision on the liquidation made by the relevant governing body of the NGO, according to the charter, which shall be recorded in the minutes. The liquidation is carried out by the liquidation commission or the governing body of the organization, which is authorized to do so. The decision on finances and property management is obligatory.
After the approval of the decision on the liquidation, it is necessary to apply to the state registrar (Interregional Department of the Ministry of Justice of Ukraine at the location) with a certain package of documents to report about the start of the liquidation process. As a result the authorized body records information about the self-dissolution of the NGO in the Register of Non-Governmental Organizations, and the corresponding information is recorded in the Unified State Register.
After the records are made and the process of dissolution begins, the liquidation commission conducts the main activity.
What shall the liquidation commission do when liquidating a non-governmental organization:
Carry out activities aimed at repayment of accounts receivable;
Perform the termination of the existing units, branches, representative offices;
Dismiss employees of a non-governmental organization;
Lawyer’s note: During the liquidation of a company, employees can be dismissed by agreement of the parties, at the initiative of the owner (it is necessary to notify employees no later than 2 months in advance) or at the employee’s own will.
The first option often has advantages, because it reduces the period of the NGO liquidation - there is no need to notify the employees 2 months in advance. Although the 2-month provision can be bypassed in another way - if the employee expresses in writing his/her desire to terminate the employment relationship sooner, without taking into account the deadline.
Close the bank accounts of the NGO;
Provide the STI with the accounting (for the last period of declaration) and primary documents for the implementation of the necessary checks and registration of the document on absence of debts to state funds and budgets;
Such inspections are usually the most time-consuming and problematic stage, where problems can arise with filed or incorrectly filed reports to the tax or financial institutions, non-payments, debts. An important element of a successful inspection is monitoring the process of the inspection, as well as the correct execution of the necessary documentation.
Passing inspections without delays and unnecessary questions from the controlling bodies is one of the main tasks of our lawyers in the process of the NGO liquidation.
Settle the claims of creditors.
It is necessary to analyze accounting documents, to identify creditors and independently send letters with information about the claims and deadlines.
Lawyer’s note: Property and funds that remained after settling creditors’ claims are transferred for statutory or charitable purposes to another (several) non-governmental organizations. This step also requires the corresponding decision, and in case of failure to make such a decision, the remaining property and funds shall be credited to the state or local budget according to the requirements of the current legislation.
After all settlements, a liquidation balance sheet is formed and a corresponding act is drawn up.
Documents are sent to the state archive, which shall be kept for a long time. A certificate of acceptance of these documents is issued.
The last step in the liquidation of the NGO will be to send the documents to the state registrar to register liquidation actions. These documents include:
Completed registration card for state registration of termination of a legal entity due to liquidation;
Document from the state tax authorities about absence of tax and other debts, including the single social security tax;
Archive certificate on transfer of documents for storage.
The state registrar terminates the legal entity in connection with the liquidation, and provides the corresponding notice to the liquidator or the head of the liquidation commission.
What is an “alternative liquidation” of a non-governmental organization?
Some cases require the immediate liquidation of a non-governmental organization, or when and in some cases it is impossible to liquidate the NGO at the moment for some reason, and the owner no longer needs it. In this case you may use an alternative liquidation of the NGO. However, for the implementation of liquidation activities correctly and quickly you need certain knowledge and skills. Taking into account our experience and best practices, we can offer the following algorithm of actions:
Existing members of the NGO write an application for withdrawal, their membership is terminated on the day of such an application and does not require state registration, unlike the change of the director, the deputy or a person who is a member of the governing body, but two new members (for example, our representatives) join the NGO.
At that time, the director of the NGO transfers managerial powers to our person, who then takes care of the fate of the NGO and its liquidation.
In the case of alternative liquidation, you need to be very careful about to whom you transfer the NGO. This is the only way you can be sure that the NGO will be liquidated and your rights will be protected.
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Legal services for the liquidation of a non-governmental organization in Kyiv or other regions of Ukraine
If you want to terminate your non-governmental organization, our lawyers offer the following services:
Analyzing your situation and finding the best way to solve it;
We minimize the risks for the members of the non-governmental organization;
Assistance with preparing documents for the liquidation of the NGO and the liquidation procedure;
We carry out liquidation of NGOs on a turnkey basis.
The cost of liquidating a non-governmental organization with the help of our lawyers will depend on the type of liquidation you choose, the timeframe in which you plan to complete the liquidation and the amount of legal services you will need. On our services page you can choose a package of services for the liquidation of a non-governmental organization.
Do you want to dissolve the non-governmental organization in Ukraine? Don’t hesitate to contact us! Our lawyers will help to terminate the NGO safely and reliably within the required period of time.
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Learn more about the NGO Liquidation Procedure in Ukraine here.