Creditors’ Voluntary Liquidation (CVL)

A CVL is an insolvent voluntary liquidation, which winds up the company. The decision to place the company into liquidation is taken by the shareholders.

The creditors control the appointment of the liquidator, who will realise all the assets on their behalf.


Compulsory Liquidation

A court order can be made to wind up a company, on the petition of a creditor, shareholder or the company itself. The Secretary of State for Trade and Industry may also apply, where it is in the public interest to do so.

The company ceases trading and all assets are collected and sold.


Members’ Voluntary Liquidation (MVL)

This procedure involves the winding up of a solvent company in order to realise the assets for the benefit of the shareholders.

Often used in the restructuring of corporate groups, or where the owner manager wishes to retire, the liquidator is appointed by the shareholders to act on their behalf. It can be a tax efficient tool for distributing a company’s capital.