Official liquidation of a company in the BVI
Knowledge of the process of liquidation of the object of entrepreneurial activity in importance is not inferior to the possession of information and practical skills of doing business. This need is due to the fact that in the absence of the necessary information during the liquidation process, the owners of the company risk losing much more capital and other assets of the company (and absolutely all businessmen without exception want to avoid it).
The exception to this fact is only one nuance. Companies are “gaskets”, i.e. Those objects of entrepreneurial activity that were created to perform only a transit function (for example, a firm that mediates a large payment, etc.) are eliminated without any complications from state bodies. The reason for this fact is simple: such companies have no assets and liabilities to third–party organizations (for example, to creditors and other firms). That is why firms – “laying” is not formally eliminated. If the owner of such a company wants to terminate its activities, it will be required only one action – the termination of the payment of annual fees and renewal fees. If payments were delayed for a certain period of time – the company is considered legally liquidated.
In all other cases (if the enterprise has certain assets and capital, or it performs a clearly defined role), the procedure for the liquidation of the business object is accompanied by all the bureaucratic consequences that every entrepreneur is obliged to know. Lack of this knowledge can lead to the “freezing” of assets, or their transfer to the state budget.
Types of the liquidation process in the BVI
At the moment, enterprises registered in the territory of this state, according to local legislation, can be eliminated only by two methods – by force or voluntarily. Forced liquidation of the enterprise is carried out when the statutory documents of the company provide for the execution of this operation at a clearly specified time.
Voluntary liquidation is carried out exclusively on the basis of a decision of the board of directors (or shareholders), which by a majority vote decided that this operation should be carried out.
When issuing an approving verdict, the management of the company loses a significant part of its authority. The management of the company is charged with the responsibility of electing the person responsible for the liquidation process (the so–called “liquidator”). From the moment he takes office, the liquidator is entrusted with the management of the firm until the end of the liquidation process.
The liquidator performs the following tasks:
- Determines the company’s obligations to third–party organizations (creditors, etc.), as well as the amount of existing capital and other corporate property.
- Distributes the company’s capital among the shareholders.
- Implements the remaining assets.
- Collects debts.
- Concludes various contracts with other organizations.
Prior to the activation of the liquidation process of an enterprise, the company’s managers should prepare a package of documents containing detailed information on the plans for the liquidation of the company. These include:
- The statement indicating the factors in favor of the need to disband the company.
- A certificate with evidence that the company is solvent (necessary to confirm the possibility of repayment of debt).
- The package of documents should be submitted to the Registrar of Companies (regulatory authority). From the moment of transfer of these securities begins the direct liquidation of the company. But often it starts 30 days after the package of papers is submitted.
During this time, the aforementioned authority publishes the announcement of the start of the liquidation process in relation to a particular company.
After the completion of this procedure, the company liquidator receives a special notification to the Registrar of Companies, after which the instance excludes the company from the list of business facilities. Since then, the company officially liquidated.
The lawyers of our company are highly qualified specialists in the field of international financial law who contributed to the successful liquidation of hundreds of companies around the world. With our help, this procedure will take place with minimal losses (in many cases, significant capital losses can be avoided almost completely). We will prepare the necessary documents, take on the negotiation process with other organizations (creditors, etc.) and provide you with full support at all stages of this operation.
We draw your attention to the fact that this article is for informational purposes only. For more advice, on official liquidation of a company in the BVI contact us at the contacts listed on the site.