A general or limited partnership is compulsorily dissolved on the basis of a court order. There can be various reasons for compulsory dissolution, usually due to non-compliance of the company or its activities with the law. If it is possible to eliminate the circumstance or defect that is the basis of the compulsory dissolution, before deciding on the compulsory dissolution of the partnership, the court sets a deadline for the partnership, during which it is possible to eliminate the defect and continue its activities afterwards.
Reasons for compulsory dissolution
The most common reasons for the compulsory dissolution of a general partnership and limited partnership:
- the partners of the partnership have not adopted the resolution on dissolution, although its adoption was mandatory in accordance with the law or the partnership agreement;
- the partnership does not meet the requirements established by law;
- the purpose or activity of the partnership does not meet the requirements stated in the law or is contrary to public order or good manners;
- the partnership agreement is in conflict with legislation.
Other cases provided by law.
Compulsory dissolution process
Submit an application for compulsory dissolution to the county court that has jurisdiction over the location in which the partnership is registered. A compulsory dissolution may also be initiated by a court.
Compulsory dissolution enters into force as of the entry into force of the relevant court decision. The court sends the corresponding information to the business register for making an entry of dissolution.
If the court decides on liquidation, the compulsory resolution on dissolution is followed by the liquidation of the general or limited partnership. Read about liquidation on the voluntary dissolution page.
Deletion of a general or limited partnership from the register without dissolution and liquidation
An exceptional procedure is provided for the deletion of a general or limited partnership from the register due to failure to submit an annual report.
If a general or limited partnership has not submitted an annual report by the deadline prescribed by law, the registrar sets a deadline for submitting the annual report to the partnership when warning the partnership of deletion from the register. If the partnership does not submit an annual report within the deadline set by the registrar and at least three months have passed since the statutory deadline for submitting the annual report, the registrar may delete the partnership from the register. For this, the following prerequisites must be met:
- the legal person does not have any assets in accordance with the land register, the ship register, the business register, or the Estonian securities register;
- the legal person is not a party to any ongoing court proceedings, criminal proceedings, or enforcement proceedings;
- certain persons and agencies have consented to deletion from the register.
In addition, the registrar publishes a notice to creditors about the deletion of the partnership from the business register in Ametlikud Teadaanded.
A partnership deleted due to failure to submit an annual report may submit an application for reinstatement in the register within three years from the date of deletion if it wishes to continue its activities. In order to be reinstated in the register, annual reports that have not been submitted in the meantime must be submitted.