What is a provisional liquidation?
The court may appoint an official liquidator provisionally at any time after the filing of a winding up application.
In what circumstances might the court appoint a provisional liquidator?
The court can appoint a provisional liquidator to preserve the assets of a company until it hears the winding up application and decides whether or not to appoint a liquidator.
This process usually takes place in a hostile environment where a dispute exists. The aim is to quickly stabilize the entity and prevent the dissipation of assets before the winding up order is granted.
Who can apply to the court to have a provisional liquidator appointed?
Generally, the application to appoint a provisional liquidator is made by a:
- director
- shareholder
- creditor
- the Australian Securities and Investments Commission.
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