How To Close A Company In Italy

An Italian company may be voluntarily deregistered even if the balance sheet is not zero. Partnerships limited by shares and limited liability companies may be dissolved in this way given the following circumstances: company term expiry; if the business has already fulfilled/cannot fulfil its purpose unless it specifically changes its statutes; operations become impossible or remain dormant for a prolonged amount of time; capital falls below the legally required minimum; board decision; other reasons listed in the Companies Act.

No closure of an Italian company is quick but this is by far the most straightforward route to go down.

In order to ensure that the Italian company is closed in the proper manner and in the quickest possible timeframe you will need to follow the steps below:

• • Move the company to a "pending dissolution company" (SRL in liquidazione). This can be done by our lawyers in Italy.
  • Ensure that you have a registered office and accountant in place during this whole period of time – we can assist you with this.
  • Shareholders hold a general meeting in front of the notary and they state their intention to wind up the company; a liquidator for the company should be appointed (usually the director)
  • The company is frozen from this moment and will remain in a state of "pending dissolution" for 12 months (to ensure that creditors and tax are paid)
  • The company can then be dissolved. This can be taken care of by our accountants in Italy.

ADVANTAGES OF VOLUNTARY DISSOLUTION

• • This is the only straightforward way of ensuring that your company is closed in the correct manner
  • Dissolution is less costly than liquidation in terms of fees and expenses.

DISADVANTAGES OF VOLUNTARY DISSOLUTION

Directors of a company that fail to file annual returns with the registrar and tax returns to the relevant tax authorities may be liable for fines and penalties

• • If the company is not dissolved in the proper manner then this could take time and money, please contact us for assistance and fees for winding up your company in Italy

This is not a choice. The company is put under compulsory liquidation where the company is unable to pay its debts, bankruptcy, revocation of an activities licence or a winding up petition is made in the public's interest. This is an expensive course of action and clear advice needs to be taken. This usually involves taking the debtor to the high court. Please call us for further assistance in these cases.

What happens in a compulsory liquidation?

• • The business owner, creditors and public prosecutor can apply to the competent court for a bankruptcy declaration.
  • The owner must lodge all financial and commercial details for the previous three years, an assessment of activities and a list of creditors with the office of the court.
  • Once declared bankrupt, the business owner loses his or her corporate assets, which are administered by a court-appointed receiver.
  • Within 60 days of the declaration of bankruptcy, the receiver must submit a report on the circumstances behind the bankruptcy. This must include an inventory of assets and a liquidation programme.

For both options it is important to take care to protect the assets of the business, to conform with the liquidator's wishes and to act responsibly. Please contact us for further information and advice as to how to proceed.