Voluntary Liquidation for Insolvent Companies Commenced by Directors/Shareholders
Although this type of liquidation can only be instigated by the directors and shareholders of a company, the correct term for this type of liquidation is a 'Creditor's Voluntary Liquidation'.
The appointment of liquidators in this type of liquidation has, as of 1 January 2008 been made simpler and far quicker. In fact, a Creditor's Voluntary Liquidation is the quickest, simplest and most inexpensive method of appointing a liquidator to an insolvent company.
Provided the directors and 95% of shareholders are in agreement with the decision to make an insolvency appointment, and where the necessary documentation is completed and signed, the appointment of liquidators can be made virtually immediately.
Once it is resolved to place the company into liquidation, the liquidator is required to convence a meeting of the company's creditors within 11 days of appointment. Liquidators do this by advertising the appointment as liquidator and the meeting details in a daily newspaper in each state in which the company traded. Liquidators are also required to contact the company's creditors directly - in writing.
- What information does the Liquidator send to creditors?
- Why place a company into liquidation?
- Do I have to attend the liquidation meeting?
- Frequently asked questions - Liquidation
