Liquidating a company in Bahrain involves a structured legal process, including obtaining approvals, settling liabilities, and canceling licenses. Below is a general step-by-step guide:
1. Board Resolution (Voluntary Liquidation):
- Board Decision: A formal board meeting is held where a resolution to liquidate the company is passed. This resolution should specify the appointment of a liquidator (a licensed liquidation firm).
- Shareholders’ Approval: The shareholders must approve the decision in an Extraordinary General Meeting (EGM). The resolution must be notarized.
2. Appointment of a Liquidator:
- Appoint a licensed liquidator who will be responsible for managing the entire liquidation process, including settling debts and selling assets.
3. Notify Relevant Authorities:
- Notify the Ministry of Industry, Commerce, and Tourism (MOICT) about the liquidation decision by submitting the notarized resolution and relevant documents.
- Publish the liquidation notice in two local newspapers (one in Arabic) announcing the liquidation process and inviting any claims against the company within a 45-day period.
4. Settle Liabilities:
- The liquidator reviews and settles all outstanding liabilities, including debts to creditors, tax payments, employee benefits, and other obligations.
- Obtain clearance certificates from relevant authorities, including:
- The Labour Market Regulatory Authority (LMRA)
- Social Insurance Organization (SIO)
- Tax Authority (if applicable)
5. Cancel Licenses and Close Bank Accounts:
- Cancel the Commercial Registration (CR) and licenses with the MOICT.
- Close the company’s bank accounts.
- Obtain no-objection certificates (NOCs) from relevant parties like the Ministry of Labour and other regulatory authorities.
6. Final Liquidation Report:
- The liquidator prepares a final report summarizing the liquidation process, including asset distribution and debt settlements.
- Submit the final report to the MOICT for approval.
7. Strike Off the Company:
- Once the liquidation process is completed and approved by the authorities, the company is officially struck off the commercial register.
8. Publish the Final Notice:
- Publish a notice in local newspapers declaring the conclusion of the liquidation and the strike-off of the company.
Key Considerations:
- The process can take several months, depending on the complexity of the company’s operations and obligations.
- All creditors must be paid off before any remaining assets are distributed to shareholders.
- Proper documentation and timely filings with the MOICT and other authorities are essential to avoid delays.
This process is relevant for companies in Bahrain, but the specific requirements may vary based on the legal structure of the company (e.g., WLL, BSC).
