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Only a solvent company may liquidate voluntarily. As part of the voluntary liquidation process a company is required, amongst other things, to submit an affidavit of solvency to the Companies Registrar, in which it declares that the company is solvent.

If a company begins the process of voluntary liquidation by the court, pursuant to the law and the court finds that the company is insolvent, the court may order the voluntary liquidation to cease and continue the proceedings under the Insolvency Law instead.

If a company begins the process of voluntary liquidation under the law and the liquidator finds that the company is insolvent, the liquidator must inform the shareholders and creditors of the company and, if the conditions for commencing a liquidation under the Insolvency Law exist, the liquidator must file a request to commence liquidation under the Insolvency Law.

Liquidation by court involvement under the companies law

A request for liquidation of a company by the court, under the law, may be submitted by either the company or its shareholders. The court's