2 — 2 — Liquidation of the Company and Division of its Assets
Article (325)
a— Every company shall be in a state of liquidation upon dissolution.b— The powers of the managers or the board of directors shall terminate upon the dissolution of the company. However, the managers shall continue to manage the company, and shall be considered towards third parties as liquidators until a liquidator is appointed and they give him their accounts and all the company's assets, books and documents.Article (326)
a— The company shall maintain its corporate entity during the liquidation period to the extent necessary for liquidation.b— The phrase (under liquidation) shall be added to the name of the company during the period of liquidation.c— The company's bodies shall remain during the period of liquidation, but their powers shall be confined to the liquidation measures falling outside the liquidators' competence.Article (327)
Relevant provisions in the company's memorandum or articles of association shall apply to liquidation. If they do not contain such provisions, the provisions of the following articles shall apply.
Article (328)
a— The partners or the extraordinary general assembly shall appoint, from among the partners or non-partners, a liquidator or more to undertake the company's liquidation, and determine his remuneration. The liquidator shall be appointed by the simple majority by which the company's resolutions are passed.b— If the company's dissolution or nullity is decided by the court, the court shall specify the manner of liquidation and appoint the liquidator and determine his remuneration. The liquidator's job shall not terminate upon the partners' death or if they are adjudged bankrupt or insolvent or if a distraint order is passed against them even if he was appointed by them.Article (329)
a— The liquidator's name and the partners' agreement on the liquidation manner or the court decision thereon shall be marked in the Commercial Registry and shall be published in one of the local daily newspapers. The liquidator shall follow up the entry procedures.b— The liquidator appointment or the manner of liquidation shall not be effective towards third parties before the day following the date of publication.Article (330)
a— The liquidator shall be dismissed in the same way he was appointed.b— In all cases, the court may, at a request by a partner and for acceptable reasons, decide to dismiss the liquidator.c— Any decision dismissing the liquidator shall appoint whoever replaces him.d— The dismissal of the liquidator shall be entered in the Commercial Registry and shall be published in one of the local daily newspapers, and it shall not be effective towards third parties before the day following the date of publication.Article (331)
a— The liquidator shall, on his appointment and in agreement with the board of directors or the managers, carry out an inventory of the company's rights, assets and liabilities. A detailed list thereof and a balance sheet shall be prepared and signed by the liquidator, the board of directors and the managers.b— The board of directors or the managers shall submit their accounts to the liquidator and hand him over the company's property, books and documents.c— The liquidator shall maintain a register to enter therein the liquidation acts, and such register shall be subject to the provisions of the Commerce Code regulating the commercial books.Article (332)
a— The liquidator shall take the necessary actions to safeguard the company's property and rights.b— He shall recover the company's rights with third parties; however, he shall not request the partners to pay the unpaid part of their shares unless liquidation so requires and provided that all partners shall be equally treated.c— The liquidator shall immediately deposit the amounts he receives in the account of the company under liquidation with any of the banks.Article (333)
The liquidator shall undertake all tasks required for liquidation, and in particular the following:
a— Representing the company towards third parties before the courts of law and accepting reconciliation and arbitration.b— Selling the company's movable and immovable property by public auction or by any other method unless the liquidator's appointment document provides for other methods of sale.c— Paying the company's due debts and setting aside the deferred or disputed debts.Article (334)
a— The liquidator shall not initiate new activities unless they are necessary for the completion of previous activities. If he initiates new activities that are not necessary for liquidation he shall be liable to the extent of all his property for such activities. If there is more than one liquidator they shall be jointly liable.b— The liquidator shall not sell the assets of the company as a whole without permission from the partners or the ordinary general assembly.Article (335)
a— The liquidator shall notify all the creditors of the commencement of liquidation and invite them to submit their claims. The notification shall be made by a registered letter with a delivery note or by publishing it in a local daily newspaper if the creditors are not known or if their domiciles are not known.b— Without prejudice to the rights of the privileged creditors, the liquidator shall pay the company's debts in proportion thereto.c— If some creditors fail to submit their claims, their debts shall be deposited with the court's treasury.d— Funds adequate enough to pay the disputed debts shall be deposited with the court's treasury, unless the owners of these debts obtain adequate guarantees or unless the distribution of the company's funds is deferred until the dispute on the said debts is resolved.Article (336)
If there is more than one liquidator, their acts shall not be valid unless they unanimously agree thereon in case the document of their appointment does not provide otherwise. This provision shall not be effective towards third parties before the date of its publication in one of the local daily newspapers.
Article (337)
The company shall be bound by the liquidator's acts undertaken in its name if such acts are necessary for liquidation purposes, even if he uses the company's signature for his own account unless the person he contracted with is mala fide.
Article (338)
Debts arising from liquidation shall have priority in payment from the company's funds over other debts.
Article (339)
a— The liquidator shall complete liquidation within the period specified in his appointment document. If such period is not specified, each partner may take the matter to the competent court to specify the period within which liquidation shall be completed.b— However, the period specified for liquidation may be extended by a resolution by the partners or by the general assembly after considering the liquidator's report in which he states the reasons justifying the incompletion of liquidation in the specified period. If the liquidation period is specified by the court, it shall not be extended without the permission thereof.Article (340)
a— The liquidator shall submit every six months to the partners or to the general assembly an interim account on liquidation.b— He shall furnish the partners with the details and information they request to the extent that does not cause any harm to the company's interests or delay liquidation.Article (341)
a— The company's funds shall be distributed on all partners after the payment of the debts referred to in article (338) of this law and after honoring the rights of the company's creditors.b— Each partner shall receive an amount equivalent to the value of the share he provided in the capital as stated in the memorandum of association or in the resolution of the general assembly approving its evaluation, or equivalent to the value of this share at the time of subscription if the value is not stated in the memorandum of association.c— If the partner's share is in the form of work or usufruct he shall get nothing.d— The remaining part of the company's funds shall be distributed among partners in proportion to their respective dividends in profits.e— If the net value of the company's assets is not sufficient to pay the partners' shares in full, the loss shall be distributed among them with the same percentages specified for loss distribution.Article (342)
The relevant provisions in the company's memorandum or articles of association shall apply to the distribution of the company's funds. If the memorandum or articles of association does not include such provisions, the provisions of the Civil Code regulating the distribution of common funds shall apply.
Article (343)
a— The liquidator shall submit to the partners or to the general assembly a final account on liquidation.b— Liquidation shall be completed on the approval of the final accounts.c— The liquidator shall enter the completion of liquidation in the Commercial Registry and publish it in one of the local daily newspapers. Completion of liquidation shall not be effective towards third parties before the date of publication.d— The liquidator shall, on the completion of liquidation, apply for striking off the company from the Commercial Registry.Article (344)
The company's books and documents shall be maintained for ten years from the date of striking off its name from the Commercial Registry at the place specified by the partners or the general assembly.
