On the 11th of January 2016, the Registrar of Companies proceeded to the strike-off (deregistration) of over 55,000 Cyprus companies that had failed to fulfil their statutory obligation to file their annual returns within the specified timeframes.
Article 327 - Procedure of Strike-Off by the Registrar of Companies:
According to the Article 327 of the Companies Law (Cap.113), the Registrar can proceed to the strike-off (deregistration) of a Company after having followed the below steps:
- Initially, the Registrar sends a letter by post in order to verify whether the company is in operation or not.
- If within one month, the Registrar has not received any reply, then within fourteen days, a second letter is sent via registered mail.
- If no reply is received within one month, then a publication is made in the Official Gazette of the Republic of Cyprus, announcing the strike-off (deregistration) of the company.
- The notice of dissolution is then sent to the company that can reply/object within 3 months.
What are the consequences for a struck off company?
A struck off Company cannot continue (legally) its business operations.
However, please note that "(a) the liability, if any, of every director, managing officer and member of the company will continue and may be enforced as if the company had not been dissolved; and (b) a strike-off does not affect the power of the Court to liquidate a company the name of which has been struck off the registry."
Procedure for Company reinstatement / restoration at the Registrar of Companies:
The company, any of its members or creditors can file to the Court a petition within twenty (20) years from the publication of the relevant notice in the Official Gazette of the Republic of Cyprus.
If the Court accepts the petition, it issues an Order for the restoration of the company. An official copy of the aforementioned Order has to be delivered to the Registrar that will reinstate the Company in the registry.
Furthermore, it will be a condition/requirement by the Registrar of Companies, upon acceptance of the petition by the court, to submit all pending financial statements, audited accounts, annual returns and any pending company levies to the Registrar of Companies for the reinstatement to be successful.
Originally published November 28, 2016
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