The provisions of the Cyprus Companies Law, Cap.113, relating to the winding up of Cyprus Companies may be either:-
- by the Court; or
- voluntary (which can be either a member’s voluntary winding up or a creditor’s voluntary winding up); or
- subject to the supervision of the Court.
Members’ Voluntary Liquidation
This is a more formal method and is used only if there is a need for a liquidator to be formally appointed in order to distribute certain assets, primarily for tax reasons.
In order to proceed with the voluntary liquidation, the liquidator must confirm that the company is solvent.
- A statutory declaration needs to be made by the directors declaring that the company is able to pay its debts.
The declaration must:
(i) be made at a board meeting within the 5 (five) weeks immediately preceding the date of the passing of the Special resolution for the voluntarily wind up the Company and
(ii) be delivered in the Companies Registry for registration before the date of such resolution and
(iii) embody a statement of the Company’s assets and liabilities as at the latest practicable date before the making of the Declaration .
- The Company must pass a Special Resolution in general meeting that it be wound up voluntarily.
- Notice of the above resolution for voluntarily winding up shall within 15 (fifteen) days after the passing of the resolution be advertised in the official gazette.
- The Liquidator must on conclusion of the winding up make accounts indicating how the property of the Company was disposed of.
- The liquidator must call a general meeting of the Company for laying before it the above accounts, such meeting to be called by advertisement in the Official Gazette of Cyprus published at least one month before the meeting.
- Within one week after the date of the above meeting the liquidator must deliver and register with the Registrar of Companies a return as to the meeting and a copy of the accounts.
All the debts of the company must be settled within 12 months from the commencement of the winding up of the company. A tax clearance certificate will also be obtained.
The procedure for a simple Members’ Voluntary Liquidation takes approximately one year for the liquidation to be completed.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought on your specific circumstances. For further information, you may contact Mrs Xenia Kasapi from the Legal department at firstname.lastname@example.org