When a company is on the brink of insolvency or has reached an insolvent state, the interests of the company’s creditors immediately take precedence. At this stage, the directors’ conduct is brought under scrutiny, consequently exposing the directors to the extremely real threat of personal liability. Directors should therefore be aware of their responsibilities at law in an insolvency scenario so as to avoid potentially incurring personal liability for their actions or possibly their inaction

This is the second part of a two-part article.

There are various winding up procedures to which a Maltese-registered company may be subjected in terms of Maltese law. Amongst the said modes of action is what is known as the members’ voluntary winding up. This refers to the solvent voluntary liquidation of a company and specifically necessitates that the company in questionwill be able to pay off its debts in full within a period not exceeding12 months from the proposed date of dissolution.

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