Business Termination and Restructuring in Azerbaijan - FChain

In recent years, Azerbaijan has been attracting an increasing number of foreign investors establishing companies here. Against this backdrop, there is also a growing number of cases where businesses change their organizational structure, cease operations, or undergo insolvency procedures. Below are practical legal aspects to consider.

If you are considering business restructuring, company liquidation, or corporate bankruptcy in Azerbaijan and want professional legal support, contact Financial Chain Corporation.

Corporate Restructuring
Under Azerbaijani law, corporate restructuring refers to the change in the structure and/or type of activity of a legal entity. The initiator can be the general meeting of participants (founders) or another competent body specified in the charter. In certain cases, explicitly provided by law, the division of a business into several legal entities or separation from its composition is carried out solely based on a court decision.

Common forms of corporate restructuring include:

• Merger with an existing legal entity;
• Consolidation of two or more companies into one;
• Transformation (change of organizational-legal form);
• Division of one legal entity into several successors;
• Separation of a new legal entity from an existing one.

Company Liquidation
Liquidation is the final termination of a company’s existence without the transfer of its rights and obligations to other parties. The legal procedure for company liquidation in Azerbaijan is determined by the Civil Code of the Republic of Azerbaijan.

A company may be liquidated, in particular, in the following situations:

• A court recognized the registration invalid due to violations committed during its establishment;
• The term of activity specified in the founding documents has expired, or the purpose for which the legal entity was created has been achieved;
• By court decision, the company operated in violation of legal requirements;
• The organization is recognized as insolvent (bankrupt);
• Other grounds explicitly provided by legislation.

Bankruptcy
If an enterprise is objectively unable to satisfy creditors’ claims, it can be declared bankrupt only by a court. Rules and procedures are established by the laws of the Republic of Azerbaijan “On Insolvency and Bankruptcy” and “On Banks”.

Legal Support from Financial Chain Corporation
Financial Chain Corporation provides comprehensive support: situation analysis and selection of the optimal procedure, preparation and submission of documents, interaction with state authorities, support during court stages, and closing actions. Contact us to receive consultation and an action plan tailored to your business needs.