Quevedo & Ponce - Noticias Legales
Dissolution, Liquidation, and Cancellation of Commercial Companies in Ecuador
- February 26th, 2025
- Quevedo & Ponce
When a company ceases operations, generates no income, or becomes unprofitable, the most prudent course of action is to close it as soon as possible. This helps to avoid the accumulation of fiscal and administrative obligations with entities such as the Superintendency of Companies, Securities, and Insurance (SCVS) and the Internal Revenue Service (SRI), as well as reducing unnecessary expenses and minimizing the risk of fines or sanctions.
The closure may be necessary for various reasons, such as unsatisfactory results, conflicts among shareholders, lack of operations, or the personal decision to finish the project. The following are the options available perform out this procedure, each one suitable for different circumstances:
- Volontary and early dissolution: This procedure allows the shareholders to decide in advance to close the company. It involves the formal dissolution of the company, liquidation of assets and liabilities, and subsequent cancellation of registration.
- Expedited procedure for voluntary dissolution, liquidation, and cancellation request: If the company has no outstanding debts, this option offers a more agile process, allowing the dissolution, liquidation, and cancellation to be completed in a single administrative act.
- Expedited cancellation: In this case, if the company has no pending obligations and all shareholders agree, a fast and efficient cancellation can be conducted before the Commercial or Corporate Registry, as appropriate.
At Quevedo & Ponce, we offer comprehensive legal counsel for the dissolution, liquidation, and cancellation of companies. Our experts ensure an efficient process, in compliance with current regulations, tailored to meet the specific needs of each client.
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The Companies Act allows to request the exclusion of a company from a massive dissolution resolution if the grounds for dissolution have been remedied and the resolution has not been registered before the Mercantile Registry. This alternative avoids to initiate a reactivation process and enables the company to maintain its legal standing. This article explains the circumstances under which this option may be exercised and the requirements that must be complied.
