THE VOLUNTARY DISSOLUTION OF AN ARUBAN LIMITED LIABILITY COMPANY
The liquidators must wind up the company?s affairs
The management board of an Aruba public limited liability company (‘NV‘) is not authorized to dissolve the company. Dissolution requires a shareholders? decision. The decision to liquidate a company must be announced in the Aruba Gazette (in which the government publishes its official announcements). Notice of liquidation shall also be filed for registration at the office of the chamber of commerce. As long as these requirements have not been complied with, the liquidation shall not be effective vis-a-vis third parties who declare in good faith that they had no knowledge thereof.
After it has been resolved to liquidate the company, the company continues to exist insofar as this is necessary for the liquidation of its affairs. From then on, the words ‘in liquidatie‘ written in full shall be added at the end of the company?s name on any document, for instance on the letterhead of the company.
The general meeting of shareholders shall appoint a liquidator or liquidators. The liquidator shall be charged with the winding up of the company’s affairs. However, in the event the general meeting of shareholders fail to appoint a liquidator, the board of directors of the company shall automatically be required to act as such.
The supervisory directors, if any, shall have the same duty with regard to the liquidator as they had with regard to the managing director prior to the liquidation.
The first stage of winding up a company’s affairs is payment of its creditors. After the creditors (if any) have been paid, the remaining assets of the company will be distributed among the shareholders in accordance with the provisions of the articles of association of the company. Certain shareholders, for example owners of preference shares, may have preferential rights to these distributions.
The liquidator is required to first draft a distribution plan containing the principles of the distribution. The distribution plan should be filed for public inspection at the office of the company and the chamber of commerce, followed by an announcement thereof in the Aruba Gazette. Any distribution may not be made until two months have elapsed since the date of publication thereof by the liquidators.
Within the two months period, every interested party may oppose the distribution or form of the distribution. Such opposition is made by means of a writ served upon the liquidator at the office of the company, followed by a petition to the judge of the court of first instance on Aruba. The service of the writ of opposition shall cause the announced distribution to be suspended, until the opposition is withdrawn or until the court judgement rendered thereon, has become final.
The judge of the court of first instance may, pending the proceedings, after the expiration of the two month period term, at the request of the liquidator or one or more other interested parties, authorise the liquidator to make a provisional distribution determined by the judge in such a manner, that the interests of the opposing parties shall not be adversely affected.
Within three weeks from the date of the decision of the judge, such decision may be appealed by both the petitioners as well as the opposing parties at the court of appeals.
After the balance left on liquidation has been distributed, and there are no other assets to the knowledge of the liquidator, the distribution has been completed. The liquidator shall register the same at the chamber of commerce. The registration marks the end of the liquidation. Prior to the registration, the completion of the liquidation shall have no effect with respect to third parties that in good faith relied on the fact that the liquidation of the company was not completed.
Karel Frielink
Attorney (Lawyer) / Partner
