If your company enters into liquidation, a liquidator is appointed to investigate your company's financial affairs, and identify and sell unsecured assets for the benefit of your creditors and shareholders.
Appointing a liquidator
Your company can be placed into liquidation by court order, or by resolution of your creditors at a watershed meeting.
A liquidator is appointed to:
- investigate your company's financial affairs
- establish what caused it to fail
- investigate possible offences by your company or directors of your company, and
- identify and sell the unsecured assets of your company to repay your debts.
A liquidator must be a licensed insolvency practitioner.
The Official Assignee cannot be appointed as liquidator unless:
- your company's shareholders are bankrupt, and the New Zealand Insolvency and Trustee Service has passed a special resolution as part of the bankruptcy administration, or
- the liquidation is court-ordered.
If the liquidation is a solvent liquidation then, a written declaration signed by the directors that the company will be able to pay its debts in full within a period of not more than 12 months after the appointment of the liquidator must be submitted to the Registrar. The directors must make this declaration after making an inquiry into the affairs of the company within 20 working days before the appointment of the liquidator and include a statement of affairs of the company showing the:
- the property of the company, and the total amount expected to be realised from that property; and
- the liabilities of the company; and
- the estimated expenses of the liquidation.
Notice of appointment
Once appointed, and before the end of the next working day, the liquidator must send us written notice of their appointment. That notice must state:
- the full legal name of the liquidator(s)
- the fact they have been appointed
- the date and time of the appointment
- the address and telephone number to which, during normal business hours, enquiries may be directed by a creditor of shareholder, and
- who made the appointment and, if the liquidator was appointed by the court, who applied to the court for the appointment.
If the position of liquidator becomes vacant
The role of liquidator may become vacant if they die, resign or are disqualified.
If the liquidator resigns, they must:
- appoint another liquidator to take their place, and
- send us notice of that new appointment.
If the liquidator is disqualified or dies, they or their representative must give notice to the New Zealand Insolvency and Trustee Service, who may appoint a person to act as liquidator until a successor is appointed by the High Court.
Replacement liquidators must also be licensed insolvency practitioners.
The liquidator may call one or more creditors' meetings to assist with the administration of the liquidation. They must issue a public notice and prepare a report before each creditors' meeting.
Reporting obligations of a liquidator
The liquidator must send regular reports to:
- every known creditor of your company
- every known shareholder of your company.
Copies of these reports must also be filed with us.
Information gathered for the initial report usually includes:
- a statement of your company's affairs
- plans for conducting the liquidation
- an estimated completion date
- an alert to creditors and stakeholders of their statutory right to call for a creditors' meeting or shareholders' meeting, or both, and
- a list of every known creditor of your company with each creditor's address, if known.
For court-ordered liquidations, the liquidator must deliver this initial report to us within 25 working days of their appointment as liquidator.
For all other liquidations, the report must be delivered within 5 working days.
The liquidator must prepare and deliver 6-monthly reports covering:
- the activities and outcomes of the liquidation over the previous 6 months
- receipts and payments
- further plans for completing the liquidation.
Each report must be delivered to us within 20 working days of the end of each 6-month period from when liquidation begins.
As soon as practicable after completing the liquidation, the liquidator must prepare and file with us, a final report on the activities and outcomes of the liquidation.
The contents of these reports are set out in regulations 6, 7 and 8 of the Companies (Reporting by Insolvency Practitioners) Regulations 2020.
The liquidator must prepare and file with us, using our online service, a summary report relating to the liquidation, if the liquidation is commenced on or after 1 September 2020.
For more information about the summary report, please refer to Regulation 9 of the Companies (Reporting by Insolvency Practitioners) Regulations 2020 .
Liquidators must report to us any serious problems relating to bodies corporate in liquidation. This includes offences, breaches of directors’ duties, and misappropriation of company funds.
Report a serious problem
When liquidation ends
When liquidation proceedings are complete, the liquidator must:
- give public notice of their intention to remove the company from the Companies Register
- file a copy of their final report, and a copy of the public notice to remove the company from the register, and
- file a summary report1.
The public notice must include:
- the name of your company
- the reason for removing the company from the register, including the relevant section of the Companies Act, and
- the date by which any objection to the removal of the company must be filed with us — that date can't be less than 20 working days from the date of the notice.
We can't remove the company from the register until the objection period provided by the liquidator has expired.
The liquidator must comply with their duty to keep the records of the liquidation and the company for not less than 6 years under section 256 of the Companies Act 1993.
Filing service for liquidators
The Companies Office offers an online service to assist liquidators with filing notices and reports, managing their document portfolios, and meeting their statutory reporting obligations.