What is the liability of a management board member?

Last updated: March 28, 2018

When you have registered a company with Xolo Leap, your company is a limited liability company (OÜ, osaühing in Estonian). This means you, as a shareholder, are legally responsible for the debts of your company only to the extent of the nominal value of your shares.

However, apart from being a shareholder, you are also a management board member of your company, having additional rights and responsibilities.

A management board member of a private limited liability company (OÜ) in Estonia is responsible for the entire company's activities, taking into account the limited liability nature of the company. If a management board member fails to fulfil his/her obligations through deliberate action or by gross negligence, he/she could also become personally liable (creditors could pursue you in person for the company's debt), according to the law. To avoid this, you as a management board member must keep the company in compliance, and ensure fulfilment of your obligations with due diligence.

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