INTRODUCTION
The following is a brief summary of the voluntary liquidation procedure for International Business Companies in the British Virgin Islands.
An International Business Company that has never issued its shares may commence winding up by a resolution of directors.
Subject to any limitations or provisions to the contrary in its Memorandum & Articles of Association, an International Business Company that has issued shares may commence winding up by a resolution of the directors or shareholders.
Once the winding up has commenced the directors powers are limited to authorizing the liquidator, by a resolution of the directors, to carry on the business of the company, and to determining to rescind the Articles of Dissolution (for details of which see paragraph titled "Rescission of the Winding Up" below).
POWERS AND DUTIES OF A LIQUIDATOR
The liquidator must identify all the company's assets, creditors and claimants. From the company's assets he must pay or arrange for payment of all claims, debts, liabilities and obligations of the company. The liquidator is responsible for distribution of any surplus assets to the members.
The liquidator must prepare a statement of account in respect of all relevant transactions and send the members of the company a copy of this, if so required by the Plan of Dissolution (for details of which see paragraph titled "Procedure for Winding Up" below).
The liquidator has the power to take custody of the assets of the company or to register any property of the company in his name or the name of his nominee. He can sell or auction the assets without notice and collect any assets or debts due to the company.
If it facilitates the liquidation process, the liquidator may borrow money and pledge or mortgage any property of the company as security. He may negotiate, compromise and settle debts, claims, liabilities or obligations of the company.
The liquidator may take legal proceedings, prosecute or defend any actions on behalf of the company and retain solicitors, accountants and other advisers or agents.
If it is in the best interest of the company to do so, and if it is provided for in the Plan of Dissolution, the liquidator may continue the business of the company to effectuate the winding up. (Permission must be obtained from the court if the business is carried on for more than two years).
The liquidator may execute any contract or agreement either in his own name or that of the company and may make any distribution in property or in money or both.
RESCISSION OF THE WINDING UP
A company may, by submitting a copy of a directors' or members' resolution to the Registrar of Companies, rescind the Articles of Dissolution (for details of which see paragraph titled Procedure for Winding Up). Within 30 days of the rescission, a notice stating that the company has rescinded the Articles of Dissolution must be placed in the Gazette, in a local paper and a publication in the country where the company has its principal office. Once the Certificate of Dissolution (for details of which see paragraph titled "Procedure for Winding Up" below) has been given, however, the dissolution cannot then be rescinded.
WINDING UP WHEN THE COMPANY IS UNABLE TO MEET ITS OBLIGATIONS
If, at the time of passing the resolution to wind up the company, the directors, members or liquidator has reason to believe that the company will be unable to discharge all claims, debts, liabilities and obligations, notice of such must be given to the Registrar of Companies.
In such cases the winding up is then carried out in accordance with the provisions of the Companies Act.
WINDING UP BY THE COURT
The courts have certain authority to wind up a company and this is done in accordance with the provisions of the Companies Act.
PROCEDURE FOR WINDING UP
The procedure for the liquidation of solvent International Business Company is as follows:-
1. The directors must approve a Plan of Dissolution containing the following information:-
2. If shares have been issued, the Plan of Dissolution must be authorized by a resolution of the members. If a meeting of members is to be held, a copy of the Plan of Dissolution must be given to each member, whether or not that member is entitled to vote. If the procedure is to be effected by way of written resolution, a copy of the Plan of Dissolution must be given to every member, whether or not entitled to vote.
3. After approval of the Plan of Dissolution by the directors and, if required, by the members, Articles of Dissolution must be executed by the company which must contain the following:-
Articles of Dissolution must be submitted to the Registry for registration together with the relevant fee (currently US$100).
4. Within 30 days of submitting Articles of Dissolution the Company must publish a notice of its dissolution both in the Official Gazette and in a newspaper circulating in the British Virgin Islands and in the country where the Company has its principal office. The notice must state:-
5. After the liquidator has completed the winding up, he must submit a notice to this effect to the Registrar of Companies who will then strike the company off and issue a Certificate of Dissolution.
6. The liquidator must then publish a further notice in the Official Gazette to the effect that the Company has been dissolved and struck off the Register.
The dissolution is effective from the date of the Certificate and the Certificate is prima facie evidence of the compliance with all the necessary requirements in respect of dissolution.
If you would like further information on the liquidation of International Business Companies or the other corporate vehicles available in the British Virgin Islands or details of how Harney Westwood & Riegels can help you with your insolvency enquiries, please contact Hazel-Dawn Hewlett.
Harney Westwood & Riegels also provide information and advice on Anguilla. To view this information Click Here
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
For further information please contact us.
The following is a brief summary of the voluntary liquidation procedure for International Business Companies in the British Virgin Islands.
An International Business Company that has never issued its shares may commence winding up by a resolution of directors.
Subject to any limitations or provisions to the contrary in its Memorandum & Articles of Association, an International Business Company that has issued shares may commence winding up by a resolution of the directors or shareholders.
Once the winding up has commenced the directors powers are limited to authorizing the liquidator, by a resolution of the directors, to carry on the business of the company, and to determining to rescind the Articles of Dissolution (for details of which see paragraph titled "Rescission of the Winding Up" below).
POWERS AND DUTIES OF A LIQUIDATOR
The liquidator must identify all the company's assets, creditors and claimants. From the company's assets he must pay or arrange for payment of all claims, debts, liabilities and obligations of the company. The liquidator is responsible for distribution of any surplus assets to the members.
The liquidator must prepare a statement of account in respect of all relevant transactions and send the members of the company a copy of this, if so required by the Plan of Dissolution (for details of which see paragraph titled "Procedure for Winding Up" below).
The liquidator has the power to take custody of the assets of the company or to register any property of the company in his name or the name of his nominee. He can sell or auction the assets without notice and collect any assets or debts due to the company.
If it facilitates the liquidation process, the liquidator may borrow money and pledge or mortgage any property of the company as security. He may negotiate, compromise and settle debts, claims, liabilities or obligations of the company.
The liquidator may take legal proceedings, prosecute or defend any actions on behalf of the company and retain solicitors, accountants and other advisers or agents.
If it is in the best interest of the company to do so, and if it is provided for in the Plan of Dissolution, the liquidator may continue the business of the company to effectuate the winding up. (Permission must be obtained from the court if the business is carried on for more than two years).
The liquidator may execute any contract or agreement either in his own name or that of the company and may make any distribution in property or in money or both.
RESCISSION OF THE WINDING UP
A company may, by submitting a copy of a directors' or members' resolution to the Registrar of Companies, rescind the Articles of Dissolution (for details of which see paragraph titled Procedure for Winding Up). Within 30 days of the rescission, a notice stating that the company has rescinded the Articles of Dissolution must be placed in the Gazette, in a local paper and a publication in the country where the company has its principal office. Once the Certificate of Dissolution (for details of which see paragraph titled "Procedure for Winding Up" below) has been given, however, the dissolution cannot then be rescinded.
WINDING UP WHEN THE COMPANY IS UNABLE TO MEET ITS OBLIGATIONS
If, at the time of passing the resolution to wind up the company, the directors, members or liquidator has reason to believe that the company will be unable to discharge all claims, debts, liabilities and obligations, notice of such must be given to the Registrar of Companies.
In such cases the winding up is then carried out in accordance with the provisions of the Companies Act.
WINDING UP BY THE COURT
The courts have certain authority to wind up a company and this is done in accordance with the provisions of the Companies Act.
PROCEDURE FOR WINDING UP
The procedure for the liquidation of solvent International Business Company is as follows:-
1. The directors must approve a Plan of Dissolution containing the following information:-
- the reason for the winding up;
- a statement that the company is and will continue to be able to pay all claims, debts, liabilities and obligations;
- a statement that the winding up will commence on the date when Articles of Dissolution are submitted to the Registrar of Companies or within 30 days of that date;
- the estimated time required to complete the winding up;
- a statement as to whether the liquidator is authorized to carry on the business of the company;
- the name and address of the liquidator(s) and any proposed remuneration; and
- a statement as to whether the liquidator is required to send the members a statement of account.
2. If shares have been issued, the Plan of Dissolution must be authorized by a resolution of the members. If a meeting of members is to be held, a copy of the Plan of Dissolution must be given to each member, whether or not that member is entitled to vote. If the procedure is to be effected by way of written resolution, a copy of the Plan of Dissolution must be given to every member, whether or not entitled to vote.
3. After approval of the Plan of Dissolution by the directors and, if required, by the members, Articles of Dissolution must be executed by the company which must contain the following:-
- the Plan of Dissolution;
- the manner in which the Plan of Dissolution was authorized. (i.e. by directors' or members' resolution)
Articles of Dissolution must be submitted to the Registry for registration together with the relevant fee (currently US$100).
4. Within 30 days of submitting Articles of Dissolution the Company must publish a notice of its dissolution both in the Official Gazette and in a newspaper circulating in the British Virgin Islands and in the country where the Company has its principal office. The notice must state:-
- that the company is in dissolution;
- the date of commencement of the dissolution; and
- the name and address of the liquidator.
5. After the liquidator has completed the winding up, he must submit a notice to this effect to the Registrar of Companies who will then strike the company off and issue a Certificate of Dissolution.
6. The liquidator must then publish a further notice in the Official Gazette to the effect that the Company has been dissolved and struck off the Register.
The dissolution is effective from the date of the Certificate and the Certificate is prima facie evidence of the compliance with all the necessary requirements in respect of dissolution.
If you would like further information on the liquidation of International Business Companies or the other corporate vehicles available in the British Virgin Islands or details of how Harney Westwood & Riegels can help you with your insolvency enquiries, please contact Hazel-Dawn Hewlett.
Harney Westwood & Riegels also provide information and advice on Anguilla. To view this information Click Here
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
For further information please contact us.
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