Voluntary Strike-Offs & Court Appointed Liquidation

The Companies Act 2014 introduces a formal Voluntary Strike-off procedure, which now has a legislative basis rather than being merely administrative. This procedure requires specific forms and eliminates the need for voluntary strike-off notices under the previous legislation.

Voluntary Strike-Off Under the New Companies Act 2014

A company may apply for voluntary strike-off if it has ceased to trade, has never traded, or has no outstanding creditors. This application must be made within 3 months of passing a special resolution confirming the company’s cessation of business and agreeing not to incur any liabilities until the process is completed. The company must also submit all overdue annual returns, provide a certificate confirming minimal assets and liabilities, and obtain a written confirmation from the Revenue Commissioners stating no objection to the strike-off. Additionally, an advertisement of the intention to apply for strike-off must be published in a daily newspaper within 30 days before the application.

Conditions for Voluntary Strike-Off

A company can apply to be struck off the register if the following conditions are met:

Business Status: The company must either never have traded or have ceased trading.
Special Resolution: Within 3 months before the application date, the company must pass a special resolution to apply for strike-off, confirming no business activities or liabilities.
Annual Returns: All outstanding annual returns must be delivered to the Registrar.
Director Certification: A certificate (Form H15, €15 fee) signed by each director must confirm assets and liabilities do not exceed €150, and no ongoing litigation.
Revenue Confirmation: Written confirmation from the Revenue Commissioners that they do not object to the strike-off.
Public Advertisement: An advertisement of the intention to strike off must be published in a daily newspaper within 30 days before the application date.

CRO Gazette – Public Notice

After receiving a valid application, the Registrar will publish a notice in the CRO Gazette, which is updated weekly on the CRO website. The company will be dissolved within 90 days of this notice unless an objection is received.

Objection to Voluntary Strike-Off

Any person may object to the strike-off using Form H16 if they believe that the application conditions were not met. The company itself can request the cancellation of the strike-off process using Form H17 within 90 days of the notice.

Procedure for Strike-Off

According to Section 728 of the Companies Act 2014, the Registrar may issue a notice of intention to strike off a company based on non-compliance. The notice includes grounds for strike-off and specifies remedial steps that must be taken within 28 days. Failure to take these steps may lead to the company being struck off and dissolved.

Court Liquidation

Court Liquidation, or winding up by the Court, occurs when a company is liquidated at the request of a member, creditor, or the Minister under specific circumstances. The High Court appoints a liquidator, who then acts as an officer of the Court and operates under its supervision. In some cases, the Court may direct that the liquidation proceed according to the rules applicable to a Creditors’ Voluntary Winding Up.

Statutory Requirements

To initiate Court Liquidation, a petition must be presented to the High Court. Upon the Court issuing a winding-up order, a certified copy of this order must be submitted to the Companies Registration Office (CRO), accompanied by the appropriate filing fee. Additionally, the liquidator must publish a notice of their appointment in Iris Oifigiúil, in accordance with Section 586, which follows the Creditors’ winding-up procedures. Any subsequent orders related to annulling, staying the winding up, or dissolving the company must also be registered.

Forms to be Delivered in Court Liquidation

In a Court Liquidation, several forms must be filed at different stages. For instance, Form E3, which details the liquidator’s acts and dealings, needs to be submitted within 7 days of the meeting, covering 12-month periods or any shorter period until the liquidation ends. Form E4, which includes the liquidator’s affidavit and accounts, must be filed within 14 days after each reporting period of 12 months, with subsequent filings every 6 months or as needed until the liquidation concludes. Additional forms, such as E5 and E7, are required only if the Creditors’ procedure is followed, and a Court Order to cease liquidation must be filed within 21 days if the Court directs.

Resignation, Removal, or Appointment of Liquidator

Appointment: A liquidator files Form E2 to notify their appointment.
Resignation: If a liquidator resigns, Form E2a must be submitted.
Removal: If a liquidator is removed, Form E2b is used.
New Appointment: A new liquidator files Form E2c to acknowledge their appointment.

Involuntary Strike-Off

A company may be struck off involuntarily if it fails to file an annual return, has not met Revenue Commissioners’ requirements, does not comply with director residency rules, lacks an active liquidator during winding up, or has no recorded directors. A company may be struck off involuntarily for several reasons:

Failure to make annual returns.
Non-compliance with Revenue Commissioners' notices.
Lack of an EEA resident director.
Absence of a liquidator or failure to comply with liquidation returns.
Absence of current directors.

Consequences of Strike-Off

If a company is struck off while still trading, its assets become state property upon dissolution. The company ceases to exist legally from the strike-off date, and its limited liability protection is lost. This may result in personal liability for its former owners, difficulties in obtaining bank loans, and potential disqualification orders against directors.

The consequences of a strike-off are severe for a company that is still trading:

Assets become the property of the State.
The company ceases to exist as a legal entity.
The protection of limited liability is lost.
Banks may refuse to lend money to the entity.
Directors may face disqualification orders by the High Court.

Contact Us Today

For more information or assistance with Court Liquidation, please contact us. Our team is here to help with the Court Liquidation process and ensure compliance with all relevant requirements.

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