Liquidation Services

We provide the following 4 services for clients considering liquidation:

  • Free initial consultation
  • Pre-insolvency advisory work - Steps leading up to a wind-up
  • Liquidations - Insolvent Liquidations
  • Liquidations - Solvent Liquidations

Free initial consultation

Meet with one of our Partners in confidence, at a time and a place that suits you. All conversations are conducted on a completely confidential and discreet basis.

Pre-insolvency advisory work

The evolution of Company Law in the 1990's and beyond has resulted in considerable changes in the whole insolvency area. Insolvencies have become much more serious environments for company directors. The implications of, and procedures involved in, winding-up a company have become increasingly onerous with the advent of the Company Law Enforcement Act 2001 and the establishment of the Office of the Director of Corporate Enforcement. The duties and responsibilities of directors and the manner in which they conducted the affairs of the insolvent company in the two year period leading to the insolvency come in for increased levels of scrutiny.

The increased burden of responsibility imposed on directors by legislation coupled with the current economic situation result in an environment where companies and their directors must align themselves with a specialist practitioner when faced with a Liquidation situation. Directors of insolvent companies ought to rely on their professional advisors to guide them through the perils of reckless trading, fraudulent preference of creditors, Directors' restriction, Directors' disqualification, personal liabilities for the debts of the company, personal guarantees, employment legislation, breaching of contracts etc. We can advise on the most advantageous steps to place a company into voluntary liquidation.

Whether it be acting as liquidators, or simply offering advice, we can help. With a breadth and depth of experience, with a particular focus on small-medium sized and owner-managed business sectors, our insolvency and liquidation specialists focus on the issues faced by clients in a troubled business. Acceptance of insolvency is critical to establishing the remedial actions to avoid the worst repercussions of business failure.

We have expertise in handling with care very delicate issues surrounding company law and taxation. We approach such matters with great sympathy and sensitivity. We understand that you may require guidance and encouragement to help you through these difficult times. We offer you a high level of Partner contact to guide you through the complex and stressful processes of insolvency. Our team has first class relationships with the legal and banking sector to ensure appropriate recognized solutions can be delivered.

Liquidation Options

When the Company reaches the end of its purpose, or becomes insolvent, one of the options open to it is to be formally wound up by a liquidation process. The three main liquidation options are creditors voluntary liquidation, court liquidation and a members voluntary liquidation.

  1. A Creditors Voluntary Liquidation (CVL) is the most commonly used procedure for dealing with an insolvent company. In summary, the directors "voluntarily" place the company into liquidation.
  2. A Court Liquidation occurs (if the relationship between the company and its creditors becomes hostile) when a petitioner/creditor petitions the High Court to appoint a liquidator. It is generally used by disgruntled creditors of a company seeking payment of monies due to them. A court liquidation may be referred to as an "official liquidation" or a "compulsory liquidation" (i.e. the company is forced to go into liquidation by a petitioner).
  3. A Members Voluntary Liquidation (MVL) is the procedure used to wind down solvent companies. Under this type of liquidation, all creditors are paid in full, and the surplus is returned to the owners/shareholders. MVLs are also known as solvent liquidations.

For further information about liquidation types 1, 2 and 3, please see below.

Creditors' Voluntary Liquidation

Voluntary liquidation allows Company Directors to enjoy aspects of control of the liquidation process as opposed to a liquidation imposed on you by creditors, the Revenue Commissioners, or the courts.

The primary duties of the Liquidator are to oversee the orderly winding up of the company, realize its assets and where there are sufficient funds available, agree and discharge the claims of the preferential and unsecured creditors.

The Liquidator is also obliged to undertake an investigation into the affairs of the insolvent company and submit a report to the Office of the Director of Corporate Enforcement which may ultimately result in issuing High Court restriction proceedings against all or some of the directors of the company.

How can we help?

  • We can advise on the most advantageous steps to place a company into voluntary liquidation.
  • Advising Directors and Shareholders on the proper procedures to be adopted in discharging their statutory responsibilities.
  • Assisting company directors with the procedures necessary to bring about the winding up of the company including the convening of the meetings of members and creditors, preparation and delivery of the requisite statutory documents and assistance in the preparation of the Statement of Assets and Liabilities.
  • We can also act as your liquidators in finalizing the company’s affairs.
  • Advising company officers in relation to defending restriction/disqualification proceedings brought against them.

 We have built strong relationships with Ireland’s leading law firms, tax specialists, banks and finance houses thereby providing a smoother and more efficient service.

Court liquidations

Court liquidations are also known as “official liquidations” or “winding up by the court” or “compulsory liquidations”. The liquidation itself is commenced by Order of the Court on foot of a petition.

Who May Present a Petition?

In practice, the majority of winding up Petitions are presented by creditors, however, the following parties are entitled to bring a petition to wind up a company:

  • A creditor
  • A contingent creditor
  • The company
  • A Shareholder
  • The Minister
  • The Registrar of Companies
  • Grounds for presenting a petition to have a company wound up are as follows
  • Where the company is unable to pay its debts.
  • Where the company has “by special resolution resolved that the company be wound up by the court”.
  • Where the company “does not commence its business within a year from its incorporation or suspends its business for a whole year”.
  • Where the court is of the opinion that it is “just and equitable to wind up the company”.
  • Where “oppression” has been proved to the satisfaction of the court. 

How Can We Help?

We can act as the official liquidator.

Members' Voluntary Liquidations

If a company is solvent and has reached the end of its useful life, a Members' Voluntary Liquidation (MVL) or solvent liquidation is a mechanism whereby it can, acting through its shareholders/directors wind up voluntarily primarily for the purpose of realising its assets and distributing the surplus (cash extraction, distribution in specie etc.) to its shareholders in accordance with their entitlements.

How can we help?

  • Advising on the members' voluntary winding up process in order to maximise the return for the shareholders by minimising 1any taxation implications.

  • Advising the members of the statutory requirements for placing a company into solvent liquidation.

  • Assisting with all statutory requirements including the preparation of the Statutory Declaration of Solvency and other 1documents

  • Convening the requisite directors and shareholder meetings which give effect to the winding up.

  • Preparing and assisting in the filing of the statutory returns in the Companies Registration Office.

  • Accepting appointment to act as Members Voluntary Liquidator and dealing with the maximisation and distribution of assets 1for the benefit of the owners.

  • Finalising the affairs of the company to allow for its dissolution. 

MVL – Tax efficient distribution of company assets

Members’ Voluntary Liquidation is an effective method for shareholders to unlock company assets in a tax efficient manner. When all creditors are paid the liquidator can distribute the remaining assets of the company to its shareholders. The tax advantage for owners is that a capital gain received on their shares will only be taxed at 25% (22% up to 7 April 2009), whereas if the surplus monies were taken out as salary, then these monies may be taxed the much higher income tax rate for pre-liquidation dividends.

One way to distribute certain assets to shareholders is to distribute them in specie i.e. in kind. Thus, freehold property may be transferred to shareholders directly. A significant advantage of in specie distributions is that no stamp duty is payable. An MVL can therefore be a tax efficient way for shareholders to extract funds from a company on cessation of trade.

We are here to help you.