The Department of Registrar of Companies and Official Receiver announced, that as from 29 September 2014 the procedure for deregistering companies will commence under section 327 of the Companies Law Cap 113 by sending reminding letters to all companies that did not file the annual returns due with the corresponding financial statements.
This follows the initial announcement in June 2014 (see our related newsletter) . The Registrar has instigated this procedure following the first announcement. As per the procedure the Registrar is obliged to send two warning letters to the companies and then follow up with deregistration. With deregistration the company ceases to operate and all its transactions and assets are immediately frozen including bank accounts. Deregistration however does not mean that the company is liquidated or ceases to exist since third party creditors and other interested parties –most notably the Inland Revenue Department- can reinstate and prosecute the company and its directors. In the event whereby the owner is willing to reinstate the company any outstanding levy, annual returns, financial statements and related taxes will need to be brought up to date and settle. In all cases penalties apply.
It is important to note that an annual return cannot be considered as filed if it is not accompanied with the corresponding financial statements. In case you have a company that is not up to date with its filings please contact a member of our staff for more information as to the procedure to follow.