This procedure is one of the modes of dissolution of companies in terms of Maltese Law. It is initiated by means of an application filed in the Registry of the Registry of the Civil Courts of Malta (Commercial Section) either by the company following a decision of the general meeting or by its board of directors, or by any debenture holder, creditor or creditors, or by any contributory or contributories, asking the Court to dissolve a company .
During this procedure, the Court will hear both plaintiff and defendant and if the elements required at law are satisfied, the Court would proceed to dissolve the company, and appoint a liquidator. The Court may appoint as liquidator an accountant, lawyer or any person approved by the Registrar of Companies as a fit and proper person, and in doing so it may also appoint the Official Receiver. If appointed, apart from the duties pertinent to the official receiver in terms of the Companies Act, the Official Receiver would act as liquidator of the dissolved company. There are minor variances, mainly procedural, whenever the Official Receiver is appointed as liquidator, such as a different procedure for registration of his appointment with the Registrar of Companies.
The main task of the Official Receiver as liquidator does not differ from that of other liquidators, and the focus would be to liquidate the assets of the company, pay the creditors, if necessary having regard to the ranking in terms of applicable law, and distribute any proceeds to the shareholders according to their shareholding.
The Official Receiver may be described as the lunga mano of the Court, and is therefore required to act independently and impartially towards the body of creditors, the company, its officers, and shareholders. He compiles preliminary reports to be presented to the Court, as well as interim and final reports throughout the winding up procedure. The Official Receiver may, if he thinks fit, compile reports stating the manner in which the company was formed and whether in his opinion any fraud has been committed by any person in its promotion or formation, and any other matter which in his opinion is desirable to bring to the notice of the Court.
The Official Receiver is remunerated out of the assets of the company or otherwise, for his services as liquidator appointed by the Court, and on such basis as the Court may direct (Art 236(2) of the Companies Act). In the event of the assets being insufficient to satisfy the liabilities of a dissolved company, the Court may make an order for the paying out of the assets of the company, of the costs, charges and expenses incurred in the dissolution and winding up according to a ranking of priority as the court thinks fit (Art 258 of the Companies Act)
Other duties of the Official Receiver include what is commonly referred to as ‘in default liquidator’. In this regard, whenever there is a vacancy in the office of a liquidator in a dissolution by the Court, the Official Receiver following notification by the Court becomes the liquidator of the dissolved company (Art 282 of the Companies Act).
Once the liquidator of a company being wound up by the Court liquidates all the property of the company, and distributes the proceeds in terms of law, the liquidator being the Official Receiver or any other person appointed by the Court, would be released from his duties of liquidator if the Court is satisfied that the liquidator has complied with the requirements of the Companies Act.