Liquidation is not just a registry filing. Under the Law on Entrepreneurs, distinguish cessation of business, creditor claims, tax matters, asset distributions and final deregistration. Closing a bank account does not erase existing liabilities or complete the statutory process.
Applicable legislation: Law of Georgia on Entrepreneurs, Tax Code of Georgia, Civil Code of Georgia
Liquidation is not merely a registry filing
A company’s dissolution requires identification of assets and liabilities, proper creditor treatment and closure of tax-related matters. Alongside registry steps, document pending contracts, employees, litigation and archive retention.
If unpaid supplier invoices and shareholder loans remain outstanding, classify them accurately before distributions. A transfer to founders should not sidestep valid creditor rights.
Relevant statutory provisionApplying the rule in practice
Where the company is owed GEL 40,000 and owes suppliers GEL 15,000, both belong in the liquidation account. Premature distribution to shareholders may create risk before liabilities and required procedures are resolved.
Inactivity is not the same as legal closure
Ceasing operations does not dissolve a company or its liabilities. Review contracts, taxes, employees, assets, creditors and litigation. Lack of revenue does not extinguish management and compliance responsibilities. The closure route should reflect the actual financial and legal position.
Corporate approvals and liquidator authority
Corporate dissolution decisions require compliance with the Law on Entrepreneurs and governing documents. Confirm who may represent the company during the process and what filings are required. Corporate resolutions and registry records should align. Shareholder disagreement can complicate the process, making approval thresholds important.
Identify and address liabilities
Prepare a liability register covering bank debts, trade payables, tax, employment settlements and guarantees. Creditor protections under current law must be respected. Distributing assets while liabilities remain unresolved may create exposure. Insolvency may call for a distinct statutory procedure rather than ordinary voluntary liquidation.
Contract and data close-out
Closure requires contract termination, receivables collection, creditor payments and transfer of records. Employee and customer information require lawful retention or deletion decisions. Do not assume outstanding obligations vanish simply because the company is dissolved. Review each unresolved claim with supporting documents.
Practical preparation checklist
Gather articles, resolutions, registry data, recent financials, contracts, creditor/debtor lists, tax records and dispute status. Assign responsibility for documents and timing. Confirm exact current forms and periods from the governing law and competent agencies rather than assuming a universal timeline.
Example: the company has stopped trading but has liabilities
Inactivity does not erase loans, leases, guarantees, employment commitments or tax reporting. Before liquidation, inventory all liabilities, including disputed ones, and obtain financial and contractual records. Consider whether the company's financial condition calls for a different legal process. Plan employee matters, retention of records and outstanding client obligations. Distribution of assets must be assessed against creditor claims and the applicable statutory process.