WINDING UP OF A COMPANY AS A MODE OF LIQUIDATION: A COMPARATIVE ANALYSIS WITH UK PERSPECTIVES

Abstract

In present, the world has been globalized. Therefore, each and every person have been interconnected. Hence, people have started to think in a modernized approached. Consequently new companies enter into the business industry. According to the Sri Lankan Law, companies are governed under the Companies Act, No 07 of 2007. Each and every company which have been and which are going to establish should be registered under the Registrar of Company. In Sri Lanka, there are different types of companies incorporated as limited company, unlimited company, company limited by guarantee. A company is a collaboration of directors, shareholder and employees. Therefore, within the company, when a financial crises occur, when a company is unable to pay its debts, when the company has no directors the company ends with winding up. According to the Companies Act there are three modes of winding up. The winding up of a company may be either by the court, voluntary or subject to the supervision of the court. A liquidator is appointed to conduct this process. Liquidator plays a major role throughout the liquidation process. The objective of this research is as follows: the difficulties of liquidation method as mode of winding up a company. Further to ascertain the loopholes of the legal system related to liquidation. Therefore a comparative analysis will be taken place with the UK companies Act 2006. This research is conducted by a qualitative method: primary sources- relevant Acts and Ordinances, secondary sources-relevant articles, websites, law journals, text book. The research paper concludes with recommendations for a liquidation process during particular time frame.