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RIPHAH INTERNATIONALRIPHAH INTERNATIONAL
UNIVERSITYUNIVERSITY
Corporate FrameworkCorporate FrameworkWorkshopWorkshop Organized byOrganized by
Riphah Business Resource CentreRiphah Business Resource Centre
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WINDING UPWINDING UP
WINDINGWINDING UPUP:: AA processprocess byby whichwhich aa companycompany isis
dissolveddissolved (i(i..ee.. itsits lifelife isis putput toto anan endend--(a(a..kk..aa Liquidation)Liquidation)
PROCESSPROCESS OFOF EWINDINGEWINDING UPUP:: AssetsAssets of of thethe companycompany areare
disposeddisposed off,off, debtsdebts of of thethe companycompany areare paidpaid off off andand
surplus,surplus, if if any,any, isis distributeddistributed amongamong thethe shareholdersshareholders inin
proportionproportion toto theirtheir holdingsholdings..
EFFECTSEFFECTS OFOF WINDINGWINDING UPUP:: OnceOnce thethe companycompany isis
dissolved/liquidated,dissolved/liquidated, itit ceasesceases toto existexist andand thereafterthereafter
cannotcannot suesue oror bebe suedsued inin itsits ownown namename..
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WINDING UPWINDING UP
LIQUIDATORLIQUIDATOR:: AA personperson appointedappointed toto carrycarry outout thethe
processprocess of of windingwinding upup..
OFFICIALOFFICIAL LIQUIDATORLIQUIDATOR:: AA liquidatorliquidator appointedappointed inin
casecase of of windingwinding upup byby thethe courtcourt.. HeHe actsacts underunder
thethe supervisionsupervision of of thethe courtcourt throughthrough aa defineddefined
reportingreporting systemsystem.. (Official(Official liquidatorliquidator neitherneither
resignresign nornor cancan bebe removedremoved tilltill conclusionconclusion of of
windingwinding up,up, exceptexcept inin casecase of of disability)disability)
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MODES OF WINDING UPMODES OF WINDING UP
TheThe windingwinding upup of of thethe companycompany cancan eithereither bebe::
ByBy thethe courtcourt
VoluntaryVoluntary
-- byby membersmembers
-- byby creditors)creditors)
SubjectSubject toto supervisionsupervision of of thethe courtcourt
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WINDING UP BY COURTWINDING UP BY COURT
WindingWinding upup courtcourt isis calledcalled CompulsoryCompulsory windingwinding upup
andand maymay bebe orderorder onon anyany of of thethe followingfollowing groundsgrounds::
MembersMembers resolve,resolve, byby SpecialSpecial Resolution,Resolution, thatthat thethe
companycompany bebe woundwound upup byby courtcourt;;
DefaultDefault inin deliveringdelivering statutorystatutory reports,reports, holdingholding of of
statutorystatutory meetingmeeting oror holdingholding of of twotwo consecutiveconsecutive
AGMsAGMs;;
TheThe CompanyCompany isis unableunable toto paypay debtdebt;;
TheThe CompanyCompany ceasesceases toto havehave anyany membermember;;
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WINDING UP BY COURTWINDING UP BY COURT
TheThe CompanyCompany doesdoes notnot commencecommence businessbusiness withinwithin
oneone yearyear fromfrom incorporationincorporation oror suspendssuspends businessbusiness
forfor aa wholewhole yearyear;;
NumberNumber of of membersmembers fallfall belowbelow thethe minimumminimum levellevel;;
TheThe CompanyCompany indulgesindulges inin fraudulentfraudulent activitiesactivities oror
carriescarries outout unlawfulunlawful businessbusiness oror takestakes upup businessbusiness
notnot authorizedauthorized byby thethe MemorandumMemorandum;;
If If inin thethe opinionopinion of of thethe court,court, itit isis just just andand
equitableequitable toto windwind upup thethe companycompany..
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WINDING UP BY COURTWINDING UP BY COURT
PERSONSPERSONS COMPITENTCOMPITENT TOTO FILEFILE PETITIONPETITION
TheThe CompanyCompany byby passingpassing SpecialSpecial ResolutionResolution;;
CreditorCreditor oror CreditorsCreditors;;
AnyAny ContributorContributor oror ContributorsContributors;;
RegistrarRegistrar of of CompaniesCompanies;;
SECPSECP oror aa personperson soso authorizedauthorized byby thethe CommissionCommission
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VOLUNTRY WINDING UPVOLUNTRY WINDING UP
VoluntaryVoluntary windingwinding upup maymay bebe undertakenundertaken::
OnOn thethe expiryexpiry of of thethe fixedfixed periodperiod of of businessbusiness oror onon
happeninghappening of of anan eventevent whichwhich havehave alreadyalready beenbeen
providedprovided inin thethe Articles/MemorandumArticles/Memorandum;;
OnOn passingpassing aa SpecialSpecial ResolutionResolution statingstating thatthat thethe
CompanyCompany bebe woundwound upup voluntarilyvoluntarily.. (Winding(Winding upup
commencescommences withwith passingpassing of of resolutionresolution butbut businessbusiness
activitiesactivities maymay continuecontinue forfor beneficialbeneficial liquidation)liquidation)
WINDING UPWINDING UP
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WINDING UP UNDER COURT SUPERVISIONWINDING UP UNDER COURT SUPERVISION
AA court,court, byby itsits ownown motionmotion oror onon anan applicationapplication byby anan
entitledentitled person,person, maymay orderorder thatthat voluntaryvoluntary windingwinding
upup shallshall continue,continue, subjectsubject toto supervisionsupervision of of thethe
courtcourt.. SuchSuch anan orderorder willwill createcreate jurisdiction jurisdiction of of thethe
courtcourt overover lawlaw suitssuits andand otherother legallegal proceedingsproceedings of of
thethe windingwinding upup..
WINDING UPWINDING UP
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CONSEQUENCES OF WINDINGCONSEQUENCES OF WINDING
THETHE COMPANYCOMPANY:: TheThe CompanyCompany continuescontinues toto existexist
duringduring windingwinding upup butbut itsits managementmanagement isis carriedcarried
outout byby thethe liquidatorliquidator tilltill finalfinal windingwinding upup;;
SHAREHOLDERSSHAREHOLDERS:: AA newnew liabilityliability asas contributorcontributor
comescomes intointo existenceexistence.. Transfer/Transfer/ alterationalteration of of sharesshares
afterafter thethe orderorder of of thethe courtcourt isis void,void, unlessunless allowedallowed
byby thethe liquidatorliquidator;;
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CONSEQUENCES OF WINDINGCONSEQUENCES OF WINDING
CREDITORSCREDITORS:: CannotCannot filefile oror continuecontinue suitssuits againstagainst thethe
CompanyCompany unlessunless allowedallowed byby thethe courtcourt;; cannotcannot proceedproceed
withwith thethe executionexecution of of aa decreedecree eveneven if if obtainedobtained priorprior toto
liquidationliquidation orderorder;;
MANAGEMENTMANAGEMENT:: OnOn appointmentappointment of of liquidator,liquidator, allall powerspowers
of of directors,directors, chief chief executiveexecutive andand otherother officersofficers ceasecease.. ((
exceptexcept relatingrelating toto givinggiving noticesnotices of of windingwinding upup andand
appointmentappointment of of liquidator)liquidator)
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THANK YOUTHANK YOU
Presented byPresented by
Khurram KhanKhurram KhanDirectorDirector-- RBRCRBRC
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HISTORY OF CORPORATE LAWS IN PAKISTANHISTORY OF CORPORATE LAWS IN PAKISTAN
1.1. HealthyHealthy GrowthGrowth of of thethe CorporateCorporate EnterprisesEnterprises
2.2. ProtectionProtection of of InvestorsInvestors andand CreditorsCreditors
3.3. PromotionPromotion of of InvestmentInvestment
4.4. DevelopmentDevelopment of of EconomyEconomy
CORPORATE FRAMEWORKCORPORATE FRAMEWORK
OBJECTIVESOBJECTIVES
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LAWLAW
�� COMPANIES ACTS, 1913COMPANIES ACTS, 1913 -- REGISTRAR JOINTREGISTRAR JOINT
STOCKSTOCK COMPANIESCOMPANIES
�� COMPANIES CAPITAL ISSUECOMPANIES CAPITAL ISSUE -- CONTROLLER OFCONTROLLER OF
ACT, 1947ACT, 1947 CAPITAL ISSUECAPITAL ISSUE
�� COMPANIES ORDINANCE, 1984COMPANIES ORDINANCE, 1984 -- CORPORATE LAWCORPORATE LAW
AUTHORITYAUTHORITY
�� COMPANIESCOMPANIES -- CORPORATE LAWCORPORATE LAW
(ISSUE OF CAPITAL)(ISSUE OF CAPITAL) RULES, 1996RULES, 1996 AUTHORITYAUTHORITY
HISTORY OF CORPORATE LAWS IN PAKISTAN (Contd)HISTORY OF CORPORATE LAWS IN PAKISTAN (Contd)
REGULATORREGULATOR
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HISTORY OF CORPORATE LAWS IN PAKISTANHISTORY OF CORPORATE LAWS IN PAKISTAN
LAWLAW REGULATORREGULATOR
�� CENTRAL DEPOSITORIESCENTRAL DEPOSITORIES -- CORPORATE LAWCORPORATE LAW
ACT, 1997ACT, 1997 AUTHORITYAUTHORITY
�� COMMISSION ACT, 1997COMMISSION ACT, 1997 -- SECPSECP
�� COMPANIES (AMENDMENTS)COMPANIES (AMENDMENTS) -- SECPSECP
ORDINANCE, 1984ORDINANCE, 1984