There are three ways that winding-up proceedings can be stopped: Can anyone appeal against or stop a winding-up order? This can happen if there are urgent matters to be dealt with relating to the company's business, employees or assets.
In some cases the OR will need to interview you at once. When a winding-up order is made, the Court will notify the OR, who will then send notice of the order to the directors. These may lead to a petition to wind up the company. Will I be notified when a winding-up order is made?Īs a director of the company you should know its financial position and whether any creditors are pressing for payment by letters, statutory demands and court proceedings. should be wound up because the Court forms the opinion that this would be just and equitable.has less than two shareholders, unless it is a private company limited by shares or guarantee.has not begun trading within a year of its incorporation or has suspended its trading for a whole year.registered as a public limited company more than a year previously but has not yet been issued with a trading certificate.has decided that it should be wound up by the High Court.
In what circumstances can a winding-up order be made?Ī winding-up order can be made if the company: IPs acting as administrative receivers, administrators or liquidators in creditors' voluntary liquidations, report evidence of unfit conduct by directors in those proceedings to The Insolvency Service's Directors Disqualification Unit.
#LIQUIDATION DEFINITION PROFESSIONAL#
They must be authorised by one of the Recognised Professional Bodies (RPBs) before they can act as IPs. They are usually accountants or solicitors. He reports any evidence of criminal offences and conduct which makes an individual unfit to be a company director to The Insolvency Service's Directors Disqualification Unit. As well as administering cases, the OR has a duty to investigate the affairs of individuals in bankruptcy and companies in compulsory liquidation. The OR is a civil servant and an officer of the High Court. In very rare instances a surplus may be available for distribution to shareholders. The liquidator's role is to realise the company's assets, pay the fees and charges arising from the liquidation and share out any remaining funds to the creditors. If there are significant assets, an insolvency practitioner (IP) may be appointed as liquidator in place of the OR, either by the Department for the Economy or at the first meeting of creditors or contributories (shareholders). The OR will tell the company's creditors and contributories (mainly shareholders) that the company is being wound up. The Official Receiver (OR) handles the early stages of a compulsory liquidation.
Any disputes over debts should be resolved with the creditor(s) before a winding-up order is made because the effects of the order are severe. A petition can still be presented even if a company is already in administrative receivership or voluntary liquidation.Ī winding-up order can still be made even if the company has no assets or disputes the amount claimed.
Less frequently, the company itself, its directors or a shareholder may petition, as (in some circumstances) may an administrative receiver, an administrator, a supervisor of a voluntary arrangement, the Department, the Financial Services Authority, the chief clerk (Crown Court), a clerk of petty sessions, or the Official Receiver. This is an insolvency procedure that applies to companies (and partnerships) and is started by a court order - a winding-up order.Ī winding-up petition is presented in the High Court, normally by a creditor, stating that the company owes a sum of money and that the company cannot pay.
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