Andorra Bills Purge of 15,000-Firm Registry to Dissolve Up to 4,000 Inactive Companies

The Andorran government has introduced a bill to purge the Companies Register, which currently lists around 15,000 registered firms, including over 2,500 presumed inactive ones.

Economy, Presidency, Work and Housing Minister Conxita Marsol outlined the initiative during a press conference. She noted that these companies, mostly long-established entities, fail to meet basic requirements such as filing annual accounts, declaring ultimate beneficial owners or settling tax obligations. Many lack employees, commercial premises or any genuine economic activity, and have ignored administrative requests.

Marsol indicated the true number of inactive firms could exceed 2,500 and approach 4,000, particularly among those never declaring beneficial owners. The bill establishes an administrative dissolution procedure without liquidation for companies breaching core duties over two consecutive years. Once inactivity is flagged, firms receive notice and a chance to respond, with the full process capped at six months. Those wishing to comply get an extra month, though Marsol expressed limited optimism about responses.

Fines for non-compliance range from 500 to 2,000 euros for late accounts and 2,500 to 15,000 euros for transparency failures, with a 25% discount for prompt payment. A streamlined sanction process will apply immediately upon enactment.

The measure aims to align the register with the country's actual economic landscape, boost transparency and curb misuse, including potential money laundering risks. It draws inspiration from a Luxembourg model.

An additional goal involves cross-checking data to identify empty properties linked to inactive firms, potentially expanding housing supply. Marsol cited preliminary indications of vacant flats tied to such companies, often set up years ago for property purchases that later ceased.

The government will submit the technical bill to parliament on Tuesday under urgent procedure, targeting June implementation, subject to amendments. Marsol stressed its necessity to ensure the register reflects only active businesses.