This briefing note considers the basis upon which companies may be struck from the Register of Guernsey Companies (the Register), what happens to any property of companies that are struck, and the steps that can be taken to restore a company to the Register.
An application for voluntary strike off is commonly used where a company has fallen dormant. Such an application must be made by the board of directors and must be accompanied by a declaration of compliance with all of the requirements of the Companies (Guernsey) Law, 2008 (the Companies Law) in respect of the application. The declaration of compliance must be signed by a director of the company.
A copy of the application must be given within 7 days of its making to every member, employee, creditor, director or manager or trustee of any pension fund established for the benefit of the company’s employees. If the company is or has been a supervised company at any time, then the application must also be copied to the Guernsey Financial Services Commission (GFSC) within 7 days.
A company cannot make an application to be struck from the Register if it has any outstanding liabilities other than an obligation to return share capital to members. It is also prevented from making an application if any of the following circumstances exist (and should withdraw an appropriately made application if any of the following subsequently arise):
Unless cause is shown to the contrary, the company in question will be struck off the Register and thereafter dissolved at the expiration of 2 months from the date upon which the Registrar gives notice of the application.
The Companies Law provides that the Registrar of Companies (the Registrar) can strike from the Register companies that are defunct or defaulting.
A defunct company is one that the Registrar has reasonable cause to believe:
A defaulting company is a company:
Unless cause is shown to the contrary, the company in question will be struck off the Register and thereafter dissolved at the expiration of 2 months from the date upon which the Registrar gives notice of the application.
It is not uncommon (particularly in the context of applications made in respect of defaulting or defunct companies) for companies to have valuable assets at the time of being struck from the Register and dissolved.
The Companies Law provides that where a company is struck from the Register under the above-described provisions, all property and rights then vested in it or held on trust for it (save for property held on trust for another person) become bona vacantia belonging to the Crown unless H.M. Receiver-General directs otherwise.
If a company is restored within six years of it having been struck off, the company is entitled (subject to any order of the Court) to have returned to it:
The Court has the discretion to extend the above six year period if it regards it equitable to do so having regard to the degree of prejudice the company would suffer.
A struck company may be restored to the Register by way of an application to the Royal Court. Such an application, which must be made within ten years of the company having been struck off or, as the case may be, dissolved and removed, may be made by:
Notice of an application to restore must be served on:
The above persons will then be given an opportunity to make representations to the Court before an order for restoration is made.
The Court may order the company to be restored to the Register if it is satisfied that the company was carrying on business at the time it was struck off or it would be just for the company to be so restored. In deciding whether or not to restore a company, the Court may have regard to inter alia:
The restoration of a company is, unless the Court orders otherwise, conditional upon payment by the applicant to:
Once restored, the company is deemed to have continued in existence.
An order to restore may be made on such terms and conditions and may contain such directions and provisions as the Court thinks fit to place the company and all other persons in the position as nearly as may be if the company had not been struck or dissolved.