The Serbian companies registry – Business Registration Agency - announced on the 20th of October, 2017, that, as of that date, it will start implementing the provisions of the Serbian Company Law regulating the compulsory liquidation of companies. These provisions have actually been in force for more than 5 years now, but they have not been implemented by the registry thus far. The registry announced that the situation will change from now on, and in the past couple of days, more than 500 companies have been put into a compulsory liquidation procedure.
Compulsory liquidation is a procedure initiated and conducted by the registry, without the involvement of the shareholders, if the reasons set out by the Company Law are met. For example, the registry can initiate compulsory liquidation over a company which doesn't have an authorised representative for a period of more than three months or a company which failed to file financial statements for the previous business year before the end of the current year.
There are a number of unclear aspects to this procedure (which were the grounds for the delay of the implementation in the first place), such as the process of settling the creditors or the shareholders' right to reverse the liquidation. We expect that these unclear issues will be resolved soon through registry practice.
Additionally, the announced changes to the Company Law, which are to be enacted by the end of the year, are also expected to introduce certain clarifications to the process.