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Company Liquidation in Malta

Company Liquidation in Malta

Updated on Thursday 18th April 2019

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company_liquidation_malta.jpg.jpgCompany liquidation in Malta represents the procedure a company employs when concluding its business activities or when these activities can no longer continue by reason of insolvency. Company dissolution means the assessment of the Maltese company’s assets, payment of the creditors and the distribution of any remaining surplus between the shareholders. There are three ways of liquidating or winding up a company in Malta:

  •          -          the members’ voluntary liquidation;
  •          -          the creditors’ voluntary liquidation;
  •          -          court liquidation.

 

Our lawyers in Malta can provide you with information about the company liquidation proceedings.

Members’ voluntary dissolution in Malta     

In order to start the liquidation procedure for a Maltese company, its directors must make a declaration through which the company engages to pay all its liabilities in 12 months. Voluntary dissolution is possible in the following cases:

  •          -          the duration of the company has expired;
  •          -          it is undergoing restructuration;
  •          -          the owner is retiring.

 

Member’s voluntary liquidation begins once the Maltese company’s shareholders pass a resolution and appoint a liquidator.

Creditors’ voluntary liquidation in Malta

In case a Maltese company is no longer able to pay its creditors and the directors are not able to make a declaration of solvency, the creditors may ask for the winding up of the company. This procedure begins at the shareholders’ meetings which creditors will also attend. In this case, compared to the members’ voluntary liquidation, the creditor can appoint a liquidator of their own choice. You can obtain more information about creditors’ dissolution proceedings from our Maltese attorneys.

Court company liquidation in Malta

There are several reasons which can lead to company liquidation issued by a court in Malta. These are:

  • -       the number of shareholders of the company decreases – less than two shareholders remain in the company for at least 6 months;
  • -       the number of directors in the company decreases and remains so for a minimum period of 6 months;
  • -       when the company’s Articles of Association specify that the company is created for a limited period of time, and that period has reached its end;
  • -       when the court decides that there are sufficient motives for the company to be liquidated.

 

Our law firm in Malta can advise in case of company liquidation ordered by a court of justice.

Compulsory liquidation in Malta

Compulsory liquidation of a Maltese company begins with a court order following the application for dissolution of the members or creditors. The Maltese court will appoint an official receiver who will carry out the investigation and draft a report for the court. The receiver will assess all the Maltese company’s assets and liabilities and the cause of insolvency. The receiver will also become the company’s liquidator and carry out any remaining activities until the creditors appoint another person.

The video below presents the main ways of liquidating a company in Malta:

Documents related to winding up a company in Malta

The following documents must be filed with the Trade Register when winding up a Maltese company:

  • -       the minutes of the shareholders’ meeting where the liquidation was decided;
  • -       the last financial statements and other accounting documents indicating the current economic situation of the company;
  • -       several forms, among which the liquidation notice, the form through which the liquidator is appointed and a solvency declaration
  • -       the liquidation notice which must be published in a daily newspaper.

 

If you need assistance in liquidation cases, please contact our law firm in Malta.