The company may be wound up under the following instances:
- Premature commencement of business
The Court may wind up a company before the Registrar of Companies has certified that it was entitled to do so
- Public company with members less than 7
The Court may wind up a public company if its members has fallen below 7.
- Loss of Capital
The Court may wind up a company if 75% of its issued share capital has been lost or has become useless for its business.
- Inability to pay debts
The Companies Act sets out certain instances where the company is deemed unable to pay its debts or alternatively if the applicant proves to the Court that it is unable to pay its debts.
- Just and equitable
The Court may wind up a company if it appears that it is just and equitable to wind up to company.
The parties who may apply to Court are: the company itself or one or more of its creditors or one or more of its members may apply to Court for the compulsory winding up of a company. There are a number of procedures which must be followed which include, inter alia, the furnishing of sufficient security for the payment of all fees and charges necessary for the prosecution of all winding up proceedings and of all costs of administration.
The application must be served on the Master of the High Court, the Receiver of Revenue, the employers and the Trade Union representing the employees.