Demerger

Sometimes circumstances dictate that reorganization is the only solution to continue the activities of a legal entity. It may involve a merger of several companies, the attachment of a new company, the reconstruction or separation of a company, and a demerger.

What does the demerger include?

Demerger means the creation of a new legal entity. It is important to understand that in this process a new legal entity succeed part of rights of the first legal entity.

Moreover, the existing legal entity continues its activities.

What you should know during the demerger in Belarus?

One of the important steps to justify the reorganization is to draw up a separation balance sheet.

The separation balance during the demerger should reflect what rights and obligations are transferred to the new legal entity. It also helps to analyze to what consequences for the company the reorganization will lead.

If you have decided to demerge a LLC or a legal entity of another form of ownership, you need to take into account several nuances recorded in the legislation of the Republic of Belarus.

Before the reorganization you should make sure that your existing company is not on the list of business entities in which an audit by the State Control Committee of the Republic of Belarus is planned in the current six months.

If your legal entity is not in the audit plan, you can proceed to the stage of notification of the upcoming reorganization of employees and creditors.

After notification, your employees are entitled to early termination of the employment contract. At the same time, creditors may request the fulfillment of obligations to them ahead of schedule.

However, you do not need to obtain approval from them to make reorganization.

When registering a new legal entity in a result of the demerger, the procedure for registering a newly created legal entity should be observed.

The founders of a new legal entity may be the founders of the main (reorganized) legal entity.

By the time of registration, the authorized fund of the new organization must be formed. It is formed at the expense of the assets of the reorganized legal entity.

We also recommend you to reflect the changes in the company's charter in a timely manner so that no further questions arise as to who is the legal successor of the enterprise and how the corporate history of the company has developed.

If you want to carry out the reorganization of the company and want to be sure that you are doing everything correctly, an excellent solution would be to get a legal assistance from professionals.

The lawyers of Beliaevs & Partners have rich experience and knowledge in the field of reorganization of legal entities and will always be able to provide you with the necessary assistance. To contact us, leave a request on our website or call us at the numbers indicated below.