Here are some frequently asked questions that different stakeholders may have.
If you are a director or shareholder...
- Strike off:
- Only suitable for small or dormant companies that are able to meet the specific requirements.
- A company may not be struck off if it is the subject, or proposed subject, of insolvency proceedings or a compromise or arrangement with its members or creditors.
- An application can be made to reinstate a company that has been struck off within 6 years after the date on which the company is dissolved.
- Winding up
- Involves the orderly liquidation of the company affairs.
- The appointment of a liquidator to manage the process of realising the company assets, ceasing or sale of its operations, payment of its debts (if any) and distribution of surplus assets (if any) among its members.
Unsure which route to take? Contact us for a consultation.
Creditors’ ability to enforce personal guarantees from directors is unlikely to be affected by the liquidation.
In the absence of any personal guarantees given, directors and shareholders typically will not be personally liable for the company’s debts.
However, directors may become personally liable if there is evidence that directors have acted inappropriately.
Yes. There is no automatic prohibition on a director of a company that enters liquidation holding another, or many other, directorships. However, one may be banned from being a director for a period of up to five years in the event of misconduct.
If the company commences liquidation prior to the hearing date, the liquidator will write to inform the courts or small claims tribunal of the commencement of liquidation.
The company is responsible for calling of the creditors meeting. As part of our service, we can assist you with necessary arrangements to send out and advertise the notice of creditors meeting.
The SOA is an important document that provides an overview of the company’s assets and liabilities. It helps the liquidator assess everything the company may own, as well as details of fixed or floating charge. After completing the SOA, the director(s) will have to sign it before a Commissioner for Oaths or a Notary Public, whichever is applicable.
As part of our services, we can provide guidance in completing the SOA and assist with making arrangement for the execution of the document.
The template for the SOA is available for download on the Ministry of Law’s website at https://io.mlaw.gov.sg/corporate-insolvency/forms/.
If you are a creditor...
Yes, your status as a creditor of a company remains regardless of your attendance at the first or subsequent creditors’ meetings during the liquidation process unless you choose to waive the amount owed to you.
Creditors who attend the first creditors meeting are able to vote on their preferred liquidator in the event that multiple liquidators are presented to the creditors. Creditors who wish to appoint alternative liquidators should present them at the meeting.
For subsequent meetings, creditors can receive updates on liquidation proceedings directly from the liquidator. Apart from providing updates, liquidators usually call for a creditors meeting to seek approval from creditors on matters pertaining to the liquidation. Attending the creditors meeting allows you have a say in those matters.
Where a resolution is passed at an adjourned meeting of any creditors or contributories of a company, the resolution shall for all purposes be treated as having been passed on the date on which it was in fact passed and not on any earlier date.
A proxy form is used to appoint a proxy to attend the creditors meeting on behalf of the creditor. Depending on the proxy form submitted, an appointed proxy would be authorized to attend and vote at the creditors meeting.
Individuals who are creditors may submit a proxy form if they are unable to attend the meeting themselves.
Companies or limited liability partnerships must appoint a proxy if they wish to be represented at the meeting. This is because creditors meetings require in-person attendance
A general proxy is allowed to exercise his/her own discretion to vote at the meeting while a special proxy may only attend the meeting to vote as the creditor has indicated in advance.
Creditors may file their POD with the liquidator once the company is in liquidation. Please visit https://io.mlaw.gov.sg/corporate-insolvency/forms/ for the form. Creditors should note that the filing fee listed on the Official Receiver’s website is only applicable for POD filed with the Official Receiver.
There is no filing fee for POD filed with any private liquidator. Creditors must submit the original POD form and a copy of any supporting documents to the liquidator’s office. Creditors may refer here for a sample POD form.
A COI is a committee appointed from the creditors of a company in liquidation. The COI represents the interests of creditor as a whole.
The committee will advise and also monitor the liquidator, approve fees and in limited circumstances, approve the use of some of the liquidator’s powers on behalf of all creditors.
The COI is usually made up of either 3 or 5 creditors or contributories.
Have more questions?
Feel free to contact us and we will do our best to provide you with some answers.