What is a members’ voluntary liquidation (MVL)?
- A procedure by which the value in the assets of a solvent company are realised and the proceedings are distributed to the creditors and members
- At the end of the liquidation, the company is dissolved
- The process is managed by a liquidator
What is the difference between creditors voluntary liquidation (CVL) and an MVL?
The MVL process is entered into and used by solvent companies, while the CVL process refers to the liquidation of an insolvent company
Statutory declaration of solvency
A company can only enter MVL if its directors are prepared to swear a statutory declaration of solvency (section 89 of the IA 1986)
How does a company enter MVL?
A company enters MVL if its members pass a special resolution that the company be wound-up (section 84 of the Insolvency Act 1986 and section 283 of the Companies Act 2006)
