Phoenix Companies
In the UK, many companies in debt decide it's more beneficial to start again by creating a new company, often referred to as a 'phoenix' company. In business terms this will mean liquidating a company as the only option and then resuming under a different name with the same customers, clients and suppliers. In some circumstances it may appear ideal for the directors, however if they trade under a name which is the same or substantially the same as the company in liquidation without approval from the Court they will be committing an offence under S216 of the Insolvency Act 1986 (and equivalent legislation in UK regions). Persons participating in the management of the 'Phoenix' company may also be held personally liable for the debts of the company under s217 of the Insolvency Act unless the Court approval has been granted.
Read more about this topic: Liquidation
Famous quotes containing the words phoenix and/or companies:
“A phoenix it is
This hearse that must bless
With aromatic gums
That cost great sums,
The way of thurification
To make a fumigation,
Sweet of reflare,
And redolent of air,”
—John Skelton (1460?–1529)
“The recent attempt to secure a charter from the State of North Dakota for a lottery company, the pending effort to obtain from the State of Louisiana a renewal of the charter of the Louisiana State Lottery, and the establishment of one or more lottery companies at Mexican towns near our border, have served the good purpose of calling public attention to an evil of vast proportions.”
—Benjamin Harrison (1833–1901)