Company Liquidation

• Company has ceased all business activities but have huge profit in the Company.
• Company cannot be struck off because of debts but is still solvent and has property or assets.
• Company is dormant for many years but have assets attach to the company.
• Directors and Shareholders do not wish to continue business in the Company.
• Predicament occurred in management level.
• Oppression by shareholders dispute.

A Members’ Voluntary Winding Up can be carried out provided that the Company is

1. solvent; and
2. able to pay its debts in full within 12 months after the commencement of winding up.

A shareholders’ meeting would require being held and a resolution is passed to obtain approval from shareholders that the company is wound up and a liquidator be appointed.

The winding up process is initiated by the shareholders. The directors will execute a written Solvency Declaration at the Board of Directors’ Meeting and then file to SSM for registration purpose. After a shareholders’ meeting is held, a liquidator will be appointed to wind up the company’s affairs and some necessary forms or letters need to submit to SSM, Official Receiver and Bank. The Liquidator is also in charge to publish the advertisement for appointment of a liquidator and final meeting in a newspaper circulating generally throughout Malaysia.

The duties of Liquidator is to dispose of all assets, settle all liabilities, distribute the remaining surplus, close bank account and obtain clearances from LHDN, EPF, SOCSO, Customs, etc.  In case the winding up process continues for more than 1 year, a general meeting of the company is mandatory to be held. The entire completion of winding up process may take about 2 years relying on how soon the company can receive the official clearance letters from the relevant authorities.

A director of the Company can be appointed to act as Liquidator for this winding up process. A company that has been dissolved and can at any time within the 2 years be restored to its original state via court order by Liquidator or any other interested party.

A Creditors’  Voluntary Winding Up is carried out where the Board of Director declares that the Company is:

1. insolvent; and
2. unable to continue its business due to its liabilities.

A meeting of the company and its creditors have to be summoned within one month.  At the extraordinary general meeting, a resolution will be passed to wind up the Company voluntarily because it cannot continue its business by reason of its liabilities and to nominate an approved liquidator to act as liquidator for winding up. A creditors’ meeting would also need to be convened on the same day of the general meeting or a day after it.

The Provisional Liquidator has to file and send some necessary forms or letters to SSM, Official Receiver and  Bank and make arrangement to publish the necessary advertisements in a newspaper circulating generally throughout Malaysia.

The duties of Provisional Liquidator is to dispose of all assets, settle all liabilities, distribute the remaining surplus, close bank account and obtain clearances from LHDN, EPF, SOCSO, Customs, etc.  In the event this type of winding up process continues for more than 1 year, a general meeting of the company is mandatory to be held. The entire completion of winding up process may take longer time and also rely on how soon the company is able to receive the official clearances from the relevant authorities.