Article 2487 of the Italian Civil Code provides that the directors of a company must call a shareholders’ meeting to approve the winding-up of the company and appoint liquidators if the orporate object has been achieved, or it has become impossible to achieve it, or the share capital has dropped below the minimum required by law. The shareholders’ meeting also determines the powers of the liquidators, with specific reference to the transfer of the company’s business, business divisions, or individual assets or rights; and the action required to realize the business value.
If the company’s funds are insufficient to repay debts and liabilities, the liquidators may ask the shareholders to provide the necessary resources, proportionally to their share of the company’s capital. No repayment of capital or earnings can be made to shareholders before completion of liquidation, unless the accounts show that such payments do not affect the full satisfaction of the company’s creditors, or unless the shareholders arrange appropriate guarantees.
The liquidators prepare interim accounts during the liquidation, describing how the liquidation is progressing, the prospects, and the GAAP adopted. Upon completion of the process, final financial statements are prepared and, after they are approved, the company is struck off the Trade Register.
Liquidation status may be revoked at any time by means of a shareholders’ resolution and, where required, after elimination of the cause of liquidation.