Company liquidation in Iceland

Suspending a venture’s functioning is an intricate course of action that requires cautious considerations to regulatory demands and laws. Entities usually resort to that procedure either when all of their primary duties are completed or they are unable to satisfy their fiscal duties, which causes bankruptcy. 

It is principal to comprehend the concept of closing down the organization, mainly in the boundaries of the country in question. This guide will help you to sort out all nuances and complicated details regarding the topic in case you plan to liquidate a company in Iceland.

Company Dissolution and Liquidation in Iceland: Overview

The course for shutting down a venture is governed by specific legal guidelines outlined in the Insolvency Act. No 70/2016. It contains two schemes for closing down the organization.

Voluntary Liquidation

It happens when the owners decide that the venture has carried out its goal and can be shut down. In order to commence the course of action, owners are obliged to make an official decision and then hire an official assignee.

Involuntary (Bankruptcy) Liquidation

When a venture is financially incapable of fulfilling its commitments, lenders can request a legal ruling to declare it insolvent. An appointed official assignee takes charge of selling its property, settling outstanding liabilities, and allocating the remaining funds to lenders based on legal precedence.

Understanding the legal structure is mandatory for entities considering closure or lenders looking to launch proceedings related to liquidation and reorganisation processes in Iceland. It is also compulsory to prepare all obligatory papers, which are vital for provision of an effortless course of action.

General points

The primary considerations encompass:

• Documentation: Prepare and maintain all necessary legal and fiscal materials to support the process;
• Stakeholder Communication: Maintain transparent communication with all stakeholders, including owners, lenders, and employees, throughout the process;
• Regulatory Abidance: Ensure abidance by all relevant laws and regulations, including tax obligations and employment laws;
• Timing and Process Management: Prompt valuing and selling belongings to maximize returns, settling debts according to legal priorities, and allocating proceeds in adherence to regulatory standards.

Understanding these considerations and following the appropriate legal procedures are vital for a smooth and lawful process of closure.

Our support and services

Specialists of Eternity Law International company are always ready to assist you in the whole course of closing the enterprise, because it is sometimes difficult to sort out all the nuances without professional help.

Lawyers of our firm have unparalleled understanding of operational nuances across numerous international jurisdictions. We elaborate solutions which are contingent on the inspection of law-making and develop forward-thinking approaches, examining feasible alterations in the rules of various regions.Contact us, and we will guide you through the whole plan of action in case you strive to know how to close a company in Iceland.