Effective business rescue and restructuring strategies require collaborative efforts from all involved parties, whether willing or not.
Our aim is to identify and implement sustainable, long-term solutions that will revitalize distressed businesses.
Liquidation is the legal process through which a company ceases its operations, realises its assets and settles its liabilities to creditors.
It may be compulsory — pursuant to a Court Order — or voluntary following a resolution of the shareholders or creditors.
ENTER CONSULTING ZONE provides guidance throughout every type of liquidation while protecting your interests and ensuring full compliance with the applicable legislation.
Important for Directors: The Official Receiver assumes the role of Liquidator and takes control of the company’s assets. Failure to cooperate with the Official Receiver may result in a public examination and in serious cases arrest and imprisonment.
• Preparation for the initial interview with the Official Receiver
• Preparation of the Statement of Affairs
• Guidance on all matters arising during the liquidation process
• Assistance with the convening and administration of meetings
A tax-efficient procedure controlled by the shareholders for the orderly distribution of the company’s assets. It is appropriate when the company is solvent and its shareholders wish to proceed with an orderly and controlled closure.
This procedure is appropriate when the company is insolvent and there is no reasonable prospect of recovery. The directors initiate the process themselves thereby avoiding compulsory liquidation.
• The company is insolvent and no longer financially viable
• Restructuring has already been attempted without success
• The directors wish to settle the company’s liabilities in a controlled manner
➤ when the period of the company’s duration, if any, (set by the articles of association of a
company) expires or
➤ when a particular event occurs, the occurrence of which was set in the articles of association to
mean the dissolution of the company
➤ when a company votes by special resolution its voluntary liquidation
➤ when a company votes by extraordinary resolution that, due to its obligations, it may not
continue operating and liquidation is advisable
One or more members of a company may decide to dissolve it voluntarily, considering that they are solvent shareholders. The directors must make a statutory declaration that the company can pay its debts within 12 months from the commencement of the procedure.
Any surplus is returned to the shareholders. In the final general meeting, the liquidator submits to the company members the final liquidation accounts and explains their conduct. The accounts must also be submitted to the Registrar of Companies.
➤ Audited financial statements which are relevant to the liquidation date
➤ A solvency statement confirming that the company can pay all its debts
➤ A written resolution approving the solvency statement
Both the members and the creditors must hold a meeting to decide upon the appointment of one or more
liquidators.
The creditors may also appoint an inspection committee if deemed appropriate.
The
liquidators shall arrange for the liquidation of the company’s affairs, and then send notices for the final
meetings.
➤ A statement of their position on the company’s affairs
➤ A list of the creditors and an estimated amount of their claims
Furthermore, they must send a notice simultaneously to both the creditors and the shareholders. Such
notices of the meeting must also be published in the Official Gazette and at least 2 local newspapers
A creditor, a contributor or any other interested party can file an application to the court for the company’s liquidation. Subsequently, the court will issue an order to that effect.
➤ The company has decided by special resolution for its liquidation by the Court
➤ The company failed to submit the statutory report to the Registrar of Companies or to hold the
statutory meeting
➤ The company does not commence its business within a year from its incorporation or suspends
its business for a year
➤ In case of a public company, the number of members is reduced below 7 and either it declares
inability to increase the number or is unable to increase it within the time given by the Court
➤ The company is unable to pay its debts
➤ The Court believes that it is fair and in accordance with the law of leniency to dissolve the
company
The Court appoints a Liquidator, who must act in accordance with a Statement of Affairs, prepared and
submitted by the company’s directors.
The liquidator follows the same steps as in a voluntary liquidation.
locate the assets to be materialised for the payment of the fees and expenses, preferential debts and
secured and unsecured creditors.
The strike-off is an administrative procedure which takes effect from a notice sent by the Registrar of Companies to the company in question or vice versa. In effect, this method is used when the Registrar of Companies is satisfied that the company in question is no longer active and has no assets.
When a company is struggling with financial difficulties, ENTER CONSULTING ZONE LTD can provide guidance and expert advice to develop a realistic and effective business rescue plan, in collaboration with you and our specialized consultants.
➤ Business restructuring from planning to execution
➤ Diagnosis and implementation of operational solutions
➤ Preservation of company sustainability
➤ Interim Management
➤ Financial Restructuring
Maria Vassiliou is a certified Mediator and a member of the Cyprus Center for Alternative Dispute Resolution. She is also listed in the Cyprus Chamber of Commerce and Industry (CCCI).
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