New regulations that mandate storing of company documents starting from the beginning of the year

From January 1st, 2021, the Danish government has implemented a new set of regulations which requires Danish companies to retain specific company documents for a minimum of five years. If a company fails to adhere to this rule, the management may face a penalty and in severe cases, the company may be dissolved by force.

The obligation to retain documents for at least five years

The new rule applies to all Danish companies governed by the Danish Companies Act, and it goes into effect for the financial year starting from January 1st, 2021, or later. The documents must be stored for a minimum of five years from the end of the financial year in which they were created. This requirement also applies to companies regulated by the Business Enterprises Act, but it does not apply to sole proprietorships.

What kind of documents need to be stored?

The term "company documents" refers to all the documents and attachments that a company is required to produce under the Danish Companies Act. This includes a wide range of documents such as founding documents, articles of association, rules of procedure, minutes of general meetings, ownership documentation, shareholders' ledger, documentation of share capital payments, and more.

It is not only the documents that the company creates itself that need to be stored, but also the ones provided by external advisors such as accountants and lawyers. Additionally, the requirement applies to voluntary attachments such as financial or accounting documents. Businesses regulated by the Business Enterprises Act must also store similar types of documents to a large extent.

How should the documents be stored?

To comply with the new regulations, companies must keep certain documents that can be easily accessed by government authorities. These documents can be stored either in a physical or digital format, and keeping the original copies is not mandatory. However, if a company opts to store physical copies, they must be kept within the borders of Denmark.

It's worth noting that the rules also apply to companies that are no longer operating, such as those that have been liquidated or dissolved by declaration. In these cases, it's still necessary to retain the documents for a certain number of years following the closure.

Possible consequences for not complying with document storage rules

Failing to store the documents properly or effectively can lead to the management of a company being fined. In extreme cases, the Danish Business Authority may even choose to dissolve the company against its wishes.