Companies Liquidation with a Court Order
Information related to Liquidations with a Court Order
Research in the bankruptcies and liquidations register
There is a register of bankruptcies and liquidations uploaded on the website of the Insolvency Department, which can be searched by registration number or name of legal entity and contains information related to the liquidation, such as the date of the winding-up order, name of liquidator, date of publication, etc.
When a winding-up order is issued
A winding-up order against a company is issued following an application to the Court, which may be submitted by the company, a creditor or contributor of the company, a receiver of another member state, the official receiver or by the examiner. The main cases where a company can be wound up by court order are when the company is unable to pay its debts or when the company has decided by special resolution to be wound up by the court. In the case of insolvency, the amount owed to a creditor must exceed €5000.
Consequences of a winding-up order
The Official Receiver registers the winding-up order in the liquidations register and publishes it in the official newspaper and on the website of the Department. With the issuance of the winding-up order, the Official Receiver becomes the liquidator of the company’s property. The company ceases to operate and the powers of the directors are immediately suspended. The only person who can act for the company is the liquidator, in order to liquidate the company’s property and pay its debts.
Obligations of the company’s officers
The officers of the company must submit to the liquidator the last audited accounts of the company, the preliminary report and the statement of affairs of the company, which is verified by an affidavit, and which contains the details of the liabilities and assets of the company on the date of issuance of the winding-up order.
Lawsuits against companies under liquidation
Where a winding-up order has been issued, or a provisional liquidator is appointed, no lawsuit or legal proceedings shall be continued or commenced against the company except with the Court’s permission and on such terms as the Court may set.
Encumbrance on the company’s property
After the issuance of the winding-up order, nobody will be entitled to register any encumbrances on the company’s property.
Proof of Debt
Any creditor who wants to recover a debt occurred before the winding-up order date, must submit to the liquidator a proof of debt form, within 35 days from the publication date of the winding-up order in the official gazette with the right to apply for time extension.
The proof of debt form is filled in with the amount of debt as at the date of the winding-up order. Along must me attached any evidence of the debt and if there are guarantors, the form with their data (LINK).
In case the debt is due to a foreign currency, must be converted to euro according to the official exchange rate on the date of the winding-up order.
In case the creditor does not submit the above forms within the specified deadline, he cannot take any legal or other measures against the guarantors.
Examination of the proof of debt form
The trustee examines every proof of debt and within 10 days accepts or rejects it in writing. If the proof of debt form is rejected, the creditor is informed about the reasons of the rejection. The guarantor is informed by the creditor regarding the acceptance or rejection of the proof of debt form. The creditor as well as the guarantor in case they are not satisfied with the decision, can appeal to the Court within 21 days, from the day they became aware of the decision. In case anyone appeals to the court, the court can validate, annul or vary the decision of the trustee.
Valuation of property subject to encumbrances
The secured creditor, within 10 days from the publication of the winding-up order in the official gazette, must submit to the liquidator and to guarantors if any, a valuation of the property on which there is a security, along with the form ΔΕΠΕ.
Within 10 days from the submission of the valuation, the liquidator and the guarantor where applicable: a) either agree among themselves and with the creditor as to the market value of the property, and in such a case the valuation is binding for all parts,
- b) either appoint an independent valuator or
- c) ask the Insolvency Department to appoint an independent valuator.
The appointed independent valuator determines, within ten days from his appointment, the value of the property subject to security, and the valuation is binding for all parts.
Payment of dividend to creditors
The company’s property is distributed to the creditors after the deduction of actual costs, the fees of the Insolvency Department and the expenses made by the applicant creditor. Privileged debts are paid firstly, and if there is sufficient amount follow any floating charges, and then the payment of unsecured debts in the same proportion.
Applications and forms related to liquidations
| Application/Form | Category | Price | Electronic Submission | |
|---|---|---|---|---|
General Proxy Form 14 | Applications and forms for companies under liquidation | €0,00 | - | More |
Proof of debt form for liquidations | Applications and forms for companies under liquidation | €0,00 | - | More |
Special Proxy Form 15 | Applications and forms for companies under liquidation | €0,00 | - | More |
Statement of affairs for companies | Applications and forms for companies under liquidation | €0,00 | - | More |