How can a company be liquidated in Hungary?
If a legal entity decides to be liquidated, the regulations of the Hungarian Act IV of 2006 on Companies must be followed.
What are the steps for company liquidation in Hungary?
If the company liquidation is initiated at the request of a creditor based on an overdue amount of an invoice, he may elaborate a request not sooner than 20 days from the due dateof the invoice related to the company liquidation. The request for company dissolution must show the reason why is requested, the amount that is due and the deadline of payment. The usual term is five days from receiving it. The claims are usually delivered through post, this way the creditor proving the delivery.
A civil action may be instituted if the debtor considers that the claim is not correct but he/she must pay it first in order to avoid the company liquidation which may occur before ending the civil action.
All the claims are deposited at the Court who must notify the debtor immediately. A 45 days delay in payment may be requested by the debtor but if the debtor doesn’t send an answer in 8 days the Court has the right to begin the process of company liquidation.
The announcement regarding the company liquidation is posted in the Company Gazette. The announcement will state the due amount, the procedure of delivering the claims, the maximum term of stating the claim. Usually the claims must be delivered to the appointed liquidator within 40 days since posting the announcement and no later than 180 days.
The same day the announcement in published in the Gazette, the process of company liquidation may begin. An appointed person, called liquidator, is taking all the necessary measures to end the process with success. The liquidator has the same authorities as the former management, except that all his attributions must be used with the final scope of company liquidation. He has the authority to close or start new contracts, audit and auction the company’s assets in order to accomplish his tasks for liquidating the business.
The liquidator must be aware that in the first stage all the claims of the creditors must be satisfied and only after that, the rest of the assets are distributed among the company’s members.
The Court is requesting the cancellation of the Hungarian company from the commercial registers after all the claims are covered and all the remaining assets are distributed among the members.
How long does it take to liquidate a company in Hungary?
Normally the Hungarian company liquidation process takes from a few months to several years depending on the size of the company, if the claims are disputed or not or if other conflicts occurs.