The main objectives of the companies winding-up are to ensure that all the company’s affairs have been dealt with properly and to have the company dissolved.
Modes of winding-up include:
- voluntary winding-up which consists of members’ (shareholders’) voluntary winding-up; and creditors’ voluntary winding-up;
- compulsory winding-up by the Court
A creditor can file a winding-up petition to the Court force the company to repay its debts. Upon commencement of the winding-up, the company’s bank account will be frozen and property transfer is prohibited, unless authorized by the Court. If the Court grants a winding-up order, the appointed provisional liquidator will summon meeting of creditors and contributors to determine whether to apply to the Court for appointing a liquidator. The provisional liquidator will also interview directors and instruct them on preparing statement of affairs. After deduction of all fees and expenses, if there are still funds remaining in the estate of the company, the liquidator will distribute this sum to creditors whose claims have been admitted.
The legal procedures involved in the liquidation are quite complicated, so please engage a lawyer.
