Section 4: Section 4: Compulsory Winding Up
Article 77 - Circumstances in which Company may be wound up by the QFC Court
Companymay be wound up by the QFC Courtif:(1) the Companyhas resolved that the Companybe wound up by the QFC Court;(2) the Companyis unable to pay its debts;(3) the Companydoes not commence its business within a year of its incorporation, or suspends its business for a whole year; or(4) the QFC Authoritymakes any application under Article 80 and the QFC Courtis of the opinion that it is just and equitable that the Companyshould be wound up.
Article 78 - Definition of inability to pay debts(1) A
Companyis deemed unable to pay its debts:(A) if a creditor to whom the Companyis indebted in a sum exceeding US$2,000.00 then due has served on the Companya written demand requiring the Companyto pay the sum so due and the Companyhas for three weeks thereafter neglected to pay the sum or to agree terms in relation to its payment to the reasonable satisfaction of the creditor; or(B) if it is proved to the satisfaction of the QFC Courtthat the Companyis unable to pay its debts as they fall due.(2) A Companyis also deemed unable to pay its debts if it is proved to the satisfaction of the QFC Courtthat the value of the Company'sassets is less than the amount of its liabilities, taking into account its contingent and prospective liabilities.
Article 79 - Application for winding up
Subject to any provision of or under
Regulationsto the contrary, an application to the QFC Courtfor the winding up of a Companymay be made by the Company, or all or a majority of the directors, or by any creditor or creditors (including any contingent or prospective creditor or creditors).
Article 80 - Application for winding up on grounds of interests of the QFC
Where it appears to the
QFC Authoritythat it is expedient in the interests of the QFCthat a Companyshould be wound up, it may make an application for the Companyto be wound up under Article 77(4).
Article 81 - Voiding of property dispositions and alteration of membership
In a winding up by the
QFC Court, any disposition of the Company'sproperty, and any transfer of shares, or alteration in the status of the Company'smembers, made after the commencement of the winding up is, unless the QFC Courtotherwise orders, void.
Article 82 - Consequences of winding-up order(1) When a winding-up order has been made, no action or proceeding shall be proceeded with or commenced against the
Companyor its property, except by leave of the QFC Courtand subject to such terms as the QFC Courtmay impose.(2) On the making of a winding-up order, a copy of the order must forthwith be forwarded to the CROby the Company.
Article 83 - Choice of Liquidator at meetings of creditors and contributories(1) Where the
QFC Courtorders that a Companybe wound up, the QFC Courtshall identify in the order the person who is to act as Liquidatorof the Company, and that person shall take office immediately upon the order being made. That person shall within 21 days summon meetings of the Company'screditors and contributories for the purpose of choosing a person to be Liquidatorof the Companyin his place.(2) The remuneration and any expenses properly incurred by the person appointed by the QFC Courtunder Article 83(1) shall be a first charge on and paid out of any property arising from the exercise of his functions as Liquidatorand which is in his custody or under his control at that time.(3) The creditors and the contributories at their respective meetings may nominate a person to be Liquidator.(4) The Liquidatorshall be the person nominated by the creditors or, where no person has been so nominated, the person (if any) nominated by the contributories.(5) In the case of different persons being nominated, any shareholder or other person liable to contribute to the assets of the Companyor creditor may, within seven days after the date on which the nomination was made by the creditors, apply to the QFC Courtfor an order either:(A) appointing the person nominated as Liquidatorby the contributories to be a Liquidatorinstead of, or jointly with, the person nominated by the creditors; or(B) appointing some other person to be Liquidatorinstead of the person nominated by the creditors.
Article 83A - Directors' powers
On the appointment of any
Liquidatorunder Article 83, all the powers of the directors cease, except so far as the Liquidatorsanctions their continuance.
Article 84 - Appointment of provisional Liquidator(1) The
QFC Courtmay, at any time after the making of a winding up application, and with a view to the preservation of the Company'sbusiness and assets, appoint a Liquidatorprovisionally and upon such terms as the QFC Courtsees fit. The powers of such a Liquidatormay be limited by the order appointing him.(2) The remuneration and any expenses properly incurred by a provisional Liquidatorshall be a first charge on and paid out of any property arising from the exercise of his functions as provisional Liquidatorand which is in his custody or under his control at that time.
Article 85 - Creditors Committee
The creditors at the meeting to be held under Article 83 or at any subsequent meeting may, if they think fit, appoint a
Creditors' Committeeof at least three and not more than five persons to exercise the functions conferred on it by or under these Regulations.
Article 86 - Power to stay winding up
QFC Courtmay at any time after an order for winding up, on the application either of the Liquidatoror any creditor or shareholder or other person liable to contribute to the assets of the Company, and on proof to the satisfaction of the QFC Courtthat all proceedings in the winding up ought to be stayed, make an order staying the proceedings, either altogether or for a limited time, on such terms and conditions as the QFC Courtthinks fit.