Actions Regarding Companies
- Last Updated on 09 September 2013
In Fiji, winding up application is the process by which a company is brought to an end or the assets or the property of the company is redistributed. Winding up is also referred to as Liquidation or dissolution. A winding-up of a company can either be voluntary (such as shareholder’s Liquidation) and compulsory (such as creditor’s Liquidation).
By law parties who are entitled to file petitions for compulsory liquidation may lodge their application with the court by:
- The company itself.
- Any creditor who establishes a prima facie case.
- The Secretary of State (or equivalent).
- The Official Receiver.
The petitioner has to establish compulsory grounds to apply for a compulsory liquidation. Some of the grounds are as follows:
- The company has not resolved.
- The company was incorporated as a public company, and has not been issued with a trading certificate (or equivalent) within 12 months of registration.
- It is an "old public company" (i.e., one that has not re-registered as a public company or become a private company under more recent companies legislation requiring this).
- It has not commenced business within the statutorily prescribed time (normally one year) of its incorporation, or has not carried on business for a statutorily prescribed amount of time.
- The number of members has fallen below the minimum prescribed by statute.
- The company is unable to pay its debts as they fall due.
- It is just and equitable to wind up the company.
In majority of the compulsory winding-up applications the common grounds of winding up application filed are the last two grounds as mentioned above.
Pursuant to the Companies Act [Cap 247] a winding up notice is served on the Debtor Company giving 21 clear days to pay debts to the Creditor. If the Debtor fails to pay debt a winding up petition is filed in High Court together with the Winding up Notice attached by the Creditor to wind up the Company. A fee of $115 is paid when the petition is filed.