INS1540 - Company liquidation: Compulsory winding up

Official Receiver’s role

When the Official Receiver (OR), London is liquidator the case may be transferred to the OR in the area where the company is situated.

The OR will immediately start investigations into the affairs of, and the reasons for failure of, any company subject to a compulsory winding up order.

The OR in the role of liquidator

• may ask the company or its directors to provide a statement of affairs and will
• call a meeting of creditors within 12 weeks of the date of the winding up order to
• give a brief history of the company’s performance (if a statement of affairs has been dispensed with the OR may report details of the company’s affairs so far as they are known)
• choose an insolvency practitioner to become liquidator
• form a liquidation committee if appropriate.

The liquidator or joint liquidators may be nominated and appointed by creditors. The OR will continue to act as liquidator if no one else is appointed (but may at any time apply to the Secretary of State for the appointment of someone else).

Notice of creditors’ meeting

At least 21 days notice of the meeting must be given to all creditors of whom the OR is aware and who are identified in the statement of affairs. The notice must show a time limit of not more than four days before which creditors must lodge proof of debt and any proxies.

The OR may decide and give notice not to summon a meeting when the OR remains as liquidator. However any creditor may request the OR to summon a meeting to appoint another liquidator. If creditors with 25% or more in value of the claimable debt agree a meeting is called but the expenses have to be met by the applicants.

HMRC may request that the OR makes an application that a specified IP be appointed liquidator if no creditor’s meeting has been convened. This is usually a simple procedure when HMRC’s debt comprises more than 50% of the creditors.

Public examination

The OR may, at any time before the dissolution of the company, apply to the Court for the public examination of any person who

• is or has been an officer of the company
• has acted as liquidator, administrator, receiver or manager of the company
• has been concerned or has taken part in the promotion, formation or management of the company.

Creditors who make up one half in value of the company’s creditors may request the OR apply for a public examination but may have to pay the cost of the hearing.