Conversion Of An Existing Company To A Private Company (IKE)
A company of another form may be converted into a private company by virtue of a resolution by its partners or shareholders, which is passed as stipulated by the law in the event of dissolution of said corporate form.
At all events, where company members will receive shares corresponding to non-capital or guarantee contributions, their consent is required.
The conversion resolution together with the private company’s Articles are registered in the Commercial Register (G.E.MI.). However, the conversion results shall not come to pass if, within one (1) month as of registration, the company’s creditor(s) object in writing to the conversion.
By means of said objections, creditors may request sufficient guarantees insofar as the financial situation of the company under conversion renders such means of protection necessary. Where no objections are raised, this is noted in G.E.MI., upon the company’s request, and conversion enters into effect as of the time of registration of such note.
Where objections are raised, the court may, upon a respective application being filed by the company, allow for the conversion to take place if it deems that the financial situation of the company or the guarantees received by or offered to such creditors do not justify such objections being raised.
The application is notified to the creditors that have raised objections whereas the court decision is subject only to an application to be set aside by default. On this occasion, the conversion shall take place upon registration to G.E.MI. of the court decision dismissing said objections or dismissing the application to set aside the judgment by default.