PDAL in Luxembourg: administrative dissolution without liquidation explained
PDAL lets the trade register dissolve certain commercial companies that have no assets and no employees. Here is who is targeted, how the procedure runs and by when you can act.
What PDAL is
The administrative dissolution procedure without liquidation (PDAL, from the French) was created by the law of 28 October 2022. It targets commercial companies that have no employees and no assets and that show serious breaches of the law: for example no registered office, no manager or a failure to file annual accounts. Source: Guichet.lu.
Who is targeted
The procedure concerns commercial companies with no assets and no employees. Several entities are excluded:
- Civil companies.
- Credit institutions, investment firms and other financial institutions.
- Insurers and reinsurers.
- Investment funds, SICARs and other regulated financial vehicles.
- Law firms.
The steps, in short
- The public prosecutor asks the manager of the trade register (RCS) to open the procedure.
- The opening decision is notified to the company's registered office by registered letter and published in two Luxembourg newspapers.
- The RCS manager checks that there are no assets or employees with banks, insurers, the mortgage offices, the Land Registry and social security.
- The prosecutor asks either to stop or to continue the procedure.
- At the latest six months after the opening is published, the closure is declared and the company is dissolved.
The deadline that matters: one month
An appeal against the opening decision must be brought within one month of its publication. This is the deadline to watch. See the deadlines calendar and the page on appeals.
Why it is urgent
The letter goes to the company's registered office. If the company no longer has an office, or nobody collects the mail there, officers and shareholders may not know the procedure has opened. Reading the register's publications, or having them monitored, is therefore the first precaution.
Frequently asked questions
Is PDAL a liquidation?
No. It dissolves the company automatically, with no liquidator. This is why it is called dissolution without liquidation.
Who decides on the dissolution?
The manager of the trade register declares the closure, after the prosecutor's request and decisions. The president of the commercial chamber of the district court rules on appeals.
Does this website give legal advice?
No. The information is general. To act in a specific procedure you need a lawyer, whom we can introduce.
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