TYPES OF TERMINATION OF FIRM ACTIVITIES
The procedure of company liquidation differs by country. In some states it implies a long-term and costly process, in other states it is possible to save on formal liquidation procedure by sending a request to the registration authority and asking to strike off the company from the registry due to cease of activity.
Nevertheless, it is worth mentioning that, e.g. in the Bahamas all company’s assets are confiscated by the government 6 months after striking-off and cannot be returned even by a court order. Also many countries have provisions in their legislation which stipulate a company’s automatic striking-off the registry in case of nonpayment of annual state fees and taxes.
If you no longer need an offshore company you can address Campio Group and we will gladly assist you with ceasing the company in two possible ways: deletion of the company from the Register or voluntary liquidation.
Striking-off from the registry
The main requirement to legal existence of a company in the country of its registration is due and timely payment of obligatory state fees. Not paying these contributions will eventually lead to striking off the company from the registry. Such striking off, however, does not imply that the company itself, its directors and shareholders get rid of their existing and future liabilities.
A stricken-off company can be restored during a certain period (this period differs in each jurisdiction and is defined by law). To do so it is necessary to simply pay all fees and duties, as well as incurred penalties for late payment. Such liquidation process is common to classic offshore jurisdictions. Liquidation procedure in non-offshore jurisdictions is usually much more stringent and not as easy.
Voluntary Liquidation
When liquidating a company voluntarily it is necessary to stick to the formal procedure defined by law. Major stages of voluntary liquidation are as follows:
- Making the decision to liquidate. Persons who can make such decision should be indicated in the company’s bylaws. These may be directors or shareholders. If the company is using nominee services then a written instruction of the decision to liquidate should be also signed by the beneficial owner.
- Before the formal procedure of voluntary liquidation starts the company must pay all outstanding liabilities as well as liquidation fees.
- Appointing company’s liquidator. This may be any person but in practice it is usually an accountant, auditor or any other person who is well aware of the financial state of the company. Responsibilities of the liquidator among others include informing the company registrar that the company has started the process of voluntary liquidation and to assess and allot company’s assets in between shareholders.
- Publication in press about commencement of the official procedure of voluntary liquidation. Such information must be published in one of the official sources in the country of registration.
- Issuing certificate of liquidation. After all the abovementioned stages are over the liquidator receives a certificate which proves company’s successful liquidation from the company registrar.
It is worth mentioning that the process of voluntary liquidation may last for several months. Each country has specific requirements and liquidation stages may differ. That is why we advise to address professionals before commencing liquidation proceedings.
THEREFORE, IF YOU NEED TO LIQUIDATE A FOREIGN COMPANY (FIRM), FOR EXAMPLE, IN CYPRUS, CONTACT OUR SPECIALISTS FOR ADVICE:
+38 (098) 737-88-88
WE WILL HELP YOU TO COMPLETE THE COMPANY AND CARRY OUT THE LIQUIDATION PROCESS VIA OFFSHORE OR IN CYPRUS.
