Subsidiary liability of the director to creditors

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maksudasm
Posts: 784
Joined: Thu Jan 02, 2025 7:11 am

Subsidiary liability of the director to creditors

Post by maksudasm »

The debts of an enterprise can be collected from its top manager if the company's assets are insufficient to completely liquidate the existing debt.

The most common example of subsidiary liability of the head of an organization is bankruptcy. When it is registered in accordance with the legislation of the Russian Federation, the director of the company is considered a key person controlling the debtor. If the fact of his illegal actions is proven during the trial, all the debts of the company can be collected from him.

Often, businessmen try to avoid paying off creditors by dismissing the entire staff of the debtor company and withdrawing the company's assets. In fact, the company's activities cease, and after a year, the registering authority has the right to liquidate it. As a result, the founders can register a new legal entity and continue their activities. However, creditors have the right to collect obligations from responsible persons, which primarily include the founders of companies and top management.

If the enterprise operates botim database and shows no signs of bankruptcy, there are no direct grounds for the manager to be liable for the organization's debts. Usually, in such cases, the tax authorities try to hold the manager accountable.

However, the Constitutional Court of the Russian Federation has limited the powers of state bodies to bring financial claims against company directors: this is only possible in cases where it is proven that the company's activities serve as a cover for the illegal actions of its manager. The Constitutional Court also prohibits the collection of tax fines imposed on an organization from individuals.

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