Liquidation

Liquidation

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The main objectives of the companies winding-up are:

    To ensure that all the company's affairs have been dealt with properly; 

    To have the company dissolved

Modes of winding-up include :

1) voluntary winding-up which consists of :

    a) members' (shareholders') voluntary winding-up; and

    b) creditors' voluntary winding-up;

2) compulsory winding-up by the High Court of the Hong Kong Special Administrative Region.

Duties of Directors of a Wound-up Company

On the appointment of a provisional liquidator or the making of the winding-up order, the powers of the directors of the company will cease. The directors must then:

1. deliver to the provisional liquidator or liquidator the company's assets, books and records and seal; 

2. attend the office of the provisional liquidator or liquidator for interview to provide information of the company's assets and dealings;

3. submit a sworn statement of affairs of the company (similar to a balance sheet) within 28 days after the appointment of a provisional liquidator or the making of the winding-up order;

4. attend meetings of creditors and contributories when notified by the provisional liquidators or liquidators;

5. continue to co-operate with the provisional liquidator or liquidator until the liquidation is concluded; and

6. notify the provisional liquidator or liquidator of any change in address.

Directors who fail to perform their duties such as failure to keep and preserve books and records of the company, failure to prepare and submit the statement of affairs, etc. may be prosecuted and disqualified from acting as directors for a certain period of time.