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    Liquidating a limited company

    The best method applicable to closing down a limited company depends on whether that company is solvent or insolvent (i.e. If you are unsure how to close down your company, or what method to use, it is advisable you speak to a professional (this may be an insolvency practitioner or a solicitor specialising in the field).

    We can certainly assist with the process and legal advice if you are unsure, worried or don’t want the hassle.

    Liquidation involves a ‘liquidator’ being appointed to wind up the affairs of a company.

    It does not necessarily mean however, that all creditors of the company will be paid, even once the company ceases to exist.

    This doesn’t have the social stigma it may once have done, but is still a hugely disruptive event.

    liquidating a limited company-60

    The company must be a solvent private company incorporated under the Hong Kong Companies Ordinance, other than those companies specified in section 291AA(16) or registered under Part XI of the Companies Ordinance, and must meet the following requirements: There are two paths to winding up a company in Hong Kong – voluntary winding up or compulsory winding up.

    The process of closing down a company is referred to as “liquidation” in common terms.

    Companies can be liquidated either by “De-registration” or “Winding Up“.

    it is able to pay off its debts, usually within a 12 month period.

    Creditors Voluntary Liquidation [CVL] – a creditors voluntary liquidation may be used to close a limited company when a company with debts is unable to pay as they fall due – i.e. In both MVL and CVL procedures to close a limited company a liquidator is appointed to realise the value of the company assets to pay any creditors in accordance with established guidelines and any surplus funds are distributed to the members.

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