Creditors Voluntary Liquidation or CVL
If you are feeling the heat from creditors and have reason to believe your company does not have a viable future you may want to enter into a CVL or Creditors’ Voluntary Liquidation. With this form of liquidation you can reduce the risk of directors facing accusations of fraud during the liquidation investigation process. This is likely one of the reasons why it is currently the most popular type of company liquidation in the UK. With a CVL:
- The directors of the company appoint an insolvency practitioner whose job it is to then voluntarily wind up the company.
- Said insolvency practitioner then arranges for the sale of assets to satisfy your company’s creditors.
Another reason for the popularity of the CVL is that it provides for a greater level of involvement by directors in the liquidation process. But make no mistake; it will result in the end of your company.