Chapter Three Compulsory Liquidation

التاريخ

2001-08-06

Article (266)	Cases for Submitting a Liquidation Request and Halting Liquidation
	A-	An application for mandatory liquidation shall be submitted to the Court by a pleading from the Attorney General, Controller or any person authorized by him in any of the following circumstances:
		1.	Should the Company commit serious violations of the Law or of its Memorandum of Association.
		2.	Should the Company fail to fulfill its commitments
		3.	Should the Company suspend its operations for one year without a legitimate or justified cause.
		4.	Should the losses of the company exceed 75% of its subscribed capital, unless its General Assembly issues a decision to increase its capital.
	B-	The Minister may request from the Controller or Attorney General to halt the liquidation procedures of the Company, if it reconciles its position before the issuance of its liquidation decision.

Article (267)	Commencement of Liquidation, Liquidator’s Appointment and Suspension of Cases Filed Against the Company
	A-	The Court shall be deemed to have commenced the liquidation of the Company as of the date of submitting the liquidation pleading thereof. The Court may adjourn the hearing, dismiss the claim or order the liquidation, along with the payment of the costs and expenses by the person responsible for the cause of liquidation.
	B-	The Court may, upon considering the Company liquidation and prior to the issuing the liquidation decision, appoint a liquidator. It shall also determine his powers and obligate him to submit a guarantee to the Court. The Court may also appoint more than one liquidator, and it may dismiss or replace them, and it shall notify the Controller of these instructions.
	C-	The Court may, upon the recommendation of the person requesting the liquidation, suspend the progress in any case that was filed or the procedures that were realized against the company whose liquidation is requested before the Courts, provided that the hearing of any new case or judicial procedures is prohibited if same were filed against the company or realized against its after the liquidation case is filed.
	D-	The issuance of the compulsory liquidation decision will result in the following
		1.	Suspension of any authorization or signatory power issued by any entity in the Company. The granting of any authorization or signatory power required by liquidation procedures is limited to the liquidator.
		2.	Suspension of the calculation of any interest due to the company debts unless the interest of these debts is secured with proper mortgages or securities.
		3.	Suspension of the calculation of the passing of the preclusive time for hearing a case dealing with any rights or due or valid claims to the Company for a period of six months as of the date of issuing the liquidation decision.
		4.	Suspension of proceeding with any case and judicial procedures instigated by the Company or against it for a three-month period, unless the liquidator decides to proceed with same before the end of that period, in accordance with the provisions of paragraph (c) of this Article.
		5.	Suspension of proceeding with any procedural or executory transactions against the Company, unless it was pursuant to the request of a mortgagee and related to the mortgaged property itself. In this case these transactions shall be halted or their acceptance shall be denied for a three-month period as of the date of the issuance of the liquidation decision.
		6.	Abatement of the periods agreed upon with the Company's debtors to settle their obligations.

Article (268)	Presenting the Liquidator with the Company's Property and Assets
	A-	The Court may, upon the request of the liquidator, issue an order authorizing him to take possession of all the properties and assets of a Public Shareholding Company, and deliver it to the liquidator. The Court may, after issuing its Company liquidation decision order any debtor, agent thereof, bank, representative or employee, to pay, deliver, transfer to the liquidator immediately all such properties, registers, records and correspondence in his possession belonging to the Company.
	B-	The Court decision issued against any debtor shall be deemed conclusive evidence that the amount for which the decision has been issued for the payment thereof is due to the company. The said debtor shall reserve the right to file an appeal against such order.

Article (269)	Procedures taken by the Liquidator to Liquidate the Company
	A-	The liquidator may carry out all the decisions and procedures which he deems necessary in order to complete the liquidation actions, including:
		1.	Managing the Company's operations to the extent necessary for the liquidation procedures, including the execution of contracts concluded before the liquidation.
		2.	Inventory of the Company's sources and assets, and compiling its debts.
		3.	Appointing any of the experts and persons to assist him in completing the liquidation procedures or appointing special committees and authorizing them with any of the duties and powers entrusted to him under his supervision
		4.	Submitting any case or commencing any legal proceedings in the name of the Company or on its behalf, in order to collect its debts and preserve its rights, including the appointment of an attorney to represent the Company in any of these cases and procedures.
		5.	Entering in all cases and judicial proceedings related to the Company's properties and interests.
	B-	Any creditor or debtor may refer to the Court in relation to the manner by which the liquidator is exercising the powers indicated in the preceding paragraph, and the Court’s decision on this matter shall be conclusive.

Article (270)	Duties and Obligations of the Liquidator and the Right of Contesting his Decisions
	A-	The liquidator of a Public Shareholding Company undertakes to comply with the following issues:
		1.	To deposit the monies he has received on behalf of the Company in the Bank designated by the Court for this purpose.
		2.	To provide the Court and the Controller at the set times, with a statement of account duly audited by the liquidation auditor, indicating his receipts and payments. This account shall not be considered final until certified by the Court.
		3.	To keep registers and accounting books properly organized in accordance with generally accepted practices for liquidation procedures. Any Company creditor or debtor may inspect such books and records upon obtaining the Court’s approval.
		4.	To summon the creditors or debtors to general meetings to ascertain their claims and listen to their suggestions.
		5.	To comply with the Court’s orders and decisions related to the creditors and debtors while supervising the properties and assets of the Company and distributing them to its creditors.
	B-	Any person aggrieved by the liquidator’s acts, procedures or decisions may contest them at Court, which may uphold, annul or amend such actions, procedures or decisions, and its judgment shall be final.

Article (271)

Appealing the Court’s Decision during Liquidation

The order of the Court for liquidating a Public Shareholding Company, or any order that it may issue during the liquidation procedure may be appealed to the Court of Appeal. This should be done in accordance with the rules and conditions for appeal stipulated in the Civil Procedures Law in force, provided that no violation be made to the provisions of this Law concerning the final orders of the Court.


Article (272)	Termination of the Company after the Issuance of a decision to dissolve it
	A-	After completing the liquidation of a Public Shareholding Company, the Court shall issue a decision to dissolve the Company. The Company shall be deemed dissolved as of the date of such a decision. The liquidator shall notify the Controller of this decision who shall publish it in the Official Gazette, and in at least two local daily newspapers at the expense of the liquidator. Should the liquidator fail to execute this procedure within fourteen days of the date of issuing the decision he shall be fined ten Dinars for each day of negligence.
	B-	If the existence of movable and immovable assets or Company rights becomes evident after its dissolution and the cancellation of its registration the Controller may refer this matter to the Court in order to appoint a legal liquidator or to entrust the previous liquidator for the purposes of dealing with these assets, or to collect and settle these rights in accordance to the liquidation provisions stipulated in this Law.

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