How does the liquidation of an Estonian company work?

If your business plans in Estonia don’t unfold as anticipated and you wish to cease operations, you have two primary options: selling the company or proceeding with the liquidation of your Estonian company.

Selling the company

Before opting for liquidation, consider selling your Estonian company. Provided the company is free from debts and has no history of illegal activities, it is possible to find a buyer. If the buyer possesses a digital ID, the transaction can be completed entirely online via the e-Notary system. In cases where one party lacks a digital ID, traditional notary services are required, either by visiting Estonia or granting power of attorney to a service provider like Silva Hunt OÜ. Once a buyer is identified, the sale process typically concludes within approximately two weeks.

Liquidating the Estonian company

If selling isn’t feasible, the liquidation of your Estonian company is the alternative. Prior to initiating liquidation, ensure all annual reports are filed, there are no outstanding debts, and accounting records are accurate.

Note: If your latest annual report is pending, we can assist with its preparation.

Although the liquidation process spans about eight months, your involvement is minimal, as we handle the majority of tasks as your appointed liquidator.

Your Responsibilities:

• Provide the company registry card.
• Submit the latest financial report.
• Offer an overview of accounting transactions (typically a printout from the accounting software).
• Digitally sign the dissolution document we prepare.
• Appoint us as your liquidator; the state fee to commence the process is €25.

Our Role:

• Draft and send the shareholder resolution on dissolution.
• Guide you through initiating the liquidation process in the Company Registration Portal, including completing the petition and appointing us as liquidator.

The court will review your petition and typically respond within 1-2 weeks to confirm the official start of the liquidation process. Following the court’s decision, we will publish the liquidation notice in Avalikud Teadaanded (the Estonian official Gazette), incurring a state fee of €7. There is a three-month window to submit the opening balance sheet of the liquidation and the annual report. After four months from the publication of the liquidation notice, we proceed with:

• Settling any creditor claims.
• Preparing the final balance sheet and asset distribution plan.
• Distributing assets among shareholders.
• Submitting an application to remove the private limited company from the commercial registry.