Company Liquidation in the Philippines
There are two main ways in which a Filipino company can be liquidated: the voluntary and the involuntary one. There is also the company liquidation procedure by shortening the corporate term. Our Philippines company formation consultants can explain the main differences between the types of company liquidation procedures.
Voluntary and involuntary company liquidation in Philippines
Starting a company in Philippines is easy, however the company liquidation procedure is not that simple and could take a while before the company is dissolved. The main laws governing over company liquidation in Philippines are the Commercial Law and the Financial Rehabilitation and Insolvency Act, shortly known as FRIA.
We mentioned above that there are two types of liquidation procedures companies in Philippines can undergo. These are:
- the voluntary liquidation without any effect on the creditors;
- the voluntary liquidation with effects on the creditors;
- the involuntary liquidation which is asked by the creditors.
Our company formation agents in Philippines can assist with the company liquidation procedures.
Company dissolution with reducing the corporate term in Philippines
This is a special procedure which preferred by many Filipino companies facing financial distress. It implies modifying the Memorandum and Articles of Association of a company. The amendments will provide for the cessation of the activities of the company within a period of time agreed by the shareholders.
The company liquidation procedure in the Philippines
It should be noted that company dissolution must be completed with one or more authorities in the Philippines. These authorities are:
- the Trade Register;
- the Department of State and Industry;
- the Securities and Exchange Commission;
- the Bureau of Internal Revenue;
- the Department of Labor and Employment.
Also, a petition with the court where the Philippines company has its business address in must be filed. Based on this petition and supporting documents stating the financial difficulties of the company, the court will issue the liquidation order.
For full information on the company liquidation procedure, please contact our Philippines company registration advisors.