Compulsory Liquidation In Cyprus: A Complete Guide

Introduction

Companies in Cyprus, like elsewhere, may encounter financial or structural difficulties that make it impossible to continue operating. In such cases, the law provides mechanisms to bring the life of a company to an end in an orderly and fair manner.

Liquidation (also referred to as winding-up) is the process by which a company is dissolved and its assets distributed to creditors and, where possible, to shareholders. Under the Companies Law, Cap. 113, a company may be wound up in three ways:

1. By the Court (Compulsory Liquidation).
2. Voluntarily (Voluntary Liquidation).
3. Subject to the supervision of the Court.

Our lawyers bring substantial expertise to this area, having advised on and acted in insolvency disputes involving debts exceeding €2 billion. This background gives us a practical understanding of how compulsory liquidation operates in Cyprus in complex, high-value cases where creditors, shareholders, and directors often have conflicting interests.