Can an LLC be subject to corporate insolvency proceedings in Georgia?

Yes. An LLC may generally be covered as a business debtor. The economic and procedural requirements of the relevant proceedings must also be met.

Can a JSC have access to rehabilitation or insolvency proceedings in Georgia?

A JSC may generally fall within the scope of corporate insolvency law. Any special rules applicable to its specific activities must also be examined.

What documents does a company in Georgia need to assess whether insolvency law applies?

These include, in particular, registration and company records, as well as schedules of assets, creditors, due liabilities, security interests, and pending proceedings. The internal authority to file an application must also be clarified.

Does a company’s insolvency in Georgia automatically make its shareholders personally liable?

No. Personal liability does not follow automatically from the company’s insolvency proceedings; it requires a separate legal basis.

Applicability of Insolvency Law to Companies in Georgia

Georgian corporate insolvency law may apply to companies with separate legal personality if they meet the statutory eligibility requirements as business debtors. For a company insolvency, its legal form, current registration status, and any special rules must be considered together.

byMariam&Luka

The relevant company forms include, in particular, the Limited Liability Company (LLC) and the Joint Stock Company (JSC). In principle, the company itself is the debtor; its assets and liabilities form the starting point for the insolvency assessment. However, initiating proceedings depends on more than the legal form alone. The economic and procedural requirements of the specific rehabilitation or insolvency proceedings must also be met. Before filing an application, the company’s records, registration extract, creditor and asset schedules, due obligations, security interests, and pending court proceedings should be fully reviewed. It should also be determined which corporate body is responsible for filing the application or adopting the required resolutions. Special procedures or exceptions may apply to certain businesses or regulated activities; these must be examined separately from the general applicability of insolvency law to companies. Including a company in insolvency proceedings does not automatically make its shareholders or corporate bodies personally liable for all company debts.

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