01.09.2022

THE INCORPORATION OF ANY COMMERCIAL COMPANY MAY BE CONTESTED

The Commercial Law defines general conditions and rules to which all commercial companies are subject, regardless of whether they are limited liability companies (LLC), joint-stock, limited partnerships, general partnerships. Among them are, for example, that a commercial company is an association of two or more persons for carrying out commercial transactions with common funds, that in some cases they may be made by only one person - for example, a sole proprietorship EOOD or a sole proprietorship EAD. The general rule is that commercial companies are legal entities.

Among the other general provisions are those that the company is considered to have arisen from the day of its entry in the commercial register, as well as that the application for entry is made by the elected governing body.

The Commercial Law also provides for responsibility for the actions of the company until registration. It is expressly stated that the actions of the founders, performed on behalf of the incorporated company until the day of registration, give rise to rights and obligations for the persons who performed them. When carrying out the transactions, it is mandatory to indicate that the company is in the process of being established, and the persons who concluded the transactions are jointly and severally liable for the assumed obligations. When the transaction is carried out by the founders or by a person authorized by them, the rights and obligations pass by law to the resulting company.

And here comes the invalidity of the established commercial company. The Commercial Law determines that the incorporation of the company is invalid only when one of the violations expressly listed in the law has been committed. This may be the case if there is no founding agreement or it is not drawn up in the form prescribed by law, if certain requirements are not met when establishing a joint-stock or limited partnership. It is also a violation if "the subject of the company's activity is against the law or good morals", as well as if the founding agreement or the statute does not contain the company, the subject of the company's activity or the amount of contributions, as well as the capital, when the law requires it. Such are also the case if the part of the capital prescribed by law has not been contributed and if less than the number of legally capable persons participated in the establishment of the company.

If any of these violations are present, any interested party, as well as the prosecutor, can request the district court at the seat of the company to declare the company invalid. However, this can only be done within one year after the establishment of the company. Then the possibility of this claim disappears.

If the request is due to good morals, due to an unpaid part of the capital, as well as in the case of problems with the articles of association or the founding act, the court declares the company invalid only if the violation has not already been remedied or will not be remedied within an appropriate period, which the court gives by ruling .

If, however, the decision of the court to declare the company invalid is reached, it produces an action from its entry into force. From that moment, the company is considered dissolved and the court sends the decision for entry in the commercial register, after which liquidation is carried out by a liquidator appointed by the registration official at the Registration Agency.

If after that actions were performed on behalf of the declared invalid company, the founders are jointly and severally liable for the assumed obligations.