Compulsory dissolution (tvangsopløsning)
Also known as referred for compulsory dissolution, forced dissolution, sendt til tvangsopløsning, tvangsopløsning
Compulsory dissolution is when Erhvervsstyrelsen (the Danish Business Authority) refers a company to the bankruptcy court because it fails to meet its obligations — for instance by not filing its annual accounts.
Key facts
- Initiated by
- Erhvervsstyrelsen
- Often ends in
- Bankruptcy
In practice
Compulsory dissolution is not bankruptcy, but it is often the stage before it: a company that fails to file its annual accounts is rarely a company with its finances under control.
For a creditor it is one of the clearest warning signals there is — and it is a matter of public record. If your customer has been referred for compulsory dissolution, the time to act is now, not in three months.
Where it commonly goes wrong
- Not spotting it. Without monitoring your customers’ company status, you find out only when the trustee writes to you.
- You give up when the company is sent for dissolution. If it is reinstated the claim lives on — and if it turns into bankruptcy, it has to be filed.