What happens in the event of compulsory dissolution?

The video is part of our video series where the lawyers at Halvorsen & Co answer frequently googled questions about tort law, family law, inheritance law, labour law and bankruptcy law.

Click here to see an overview of all the videos.

If a company does not fulfil the requirements set out in the Companies Act, this may lead to the compulsory dissolution of the company. This may be due to, for example, failure to submit annual accounts by the deadline, failure to have a registered auditor when required, or an illegally constituted board of directors.

Forced dissolution does not happen immediately. The companies will first be given an opportunity to rectify the deficiencies, and they will receive a notice of the deficiencies from either the Register of Business Enterprises or the Register of Accounts at the Brønnøysund Register. If the company does not rectify the deficiencies within the specified deadline, it will be announced in the Brønnøysund Register that the company is given a final deadline. If the deficiencies are still not corrected within this deadline, the Brønnøysund Register will notify the local district court to compulsorily dissolve the company. The district court will then make a decision on compulsory dissolution in accordance with the Bankruptcy Act and the Coverage Act. A trustee will then be appointed to take care of the further process with the compulsorily dissolved company.