A division of a legal entity is the process of dividing its assets and liabilities between two or more newly created enterprises.
It is also necessary to know that the decision on the division of an enterprise is made by its supreme body, which simultaneously approves the charters of new enterprises, and, if necessary, approves the supreme bodies of new enterprises. In this case, the old enterprise ceases to exist.
Reorganization of an enterprise in the form of division is a laborious and time-consuming process, during which numerous questions, nuances and problems may arise. Therefore, before proceeding with these actions, it is necessary to carefully consider all future steps and seek help from highly qualified specialists who work for LegalAct and will accurately carry out the reorganization process as soon as possible.
The separation balance sheet must contain a provision on legal succession for all obligations of the reorganized legal entity in respect of all its creditors and debtors, including the obligations disputed by the Parties. The separation balance sheet is approved by the founders (participants) of the legal entity or the body that made the decision on the reorganization of the legal entity, is submitted together with the constituent documents for state registration of the newly emerged legal entities.
If the separation balance sheet does not make it possible to determine the legal successor of the reorganized legal entity, the newly emerged legal entities shall be jointly and severally liable for the obligations of the reorganized legal entity to its creditors.
Finally, the general meeting of the founders of each company created as a result of the division approves the charter and elects the governing bodies of their company.
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