Winding Up vs Striking Off in Malaysia

What is the differences between winding up and striking off in Malaysia

The key differences between winding up and striking off in Malaysia.

Strike Off:

Governed under Section 550 of the Companies Act 2016.
Suitable for dormant or inactive companies with no assets or liabilities.
Process starts with a board resolution (shareholder consent advisable), submission of strike-off application to SSM, and publication in the SSM Gazette with a 60-day objection period.
Faster and simpler procedure typically taking 6-12 months.
Lower cost
Final dissolution occurs upon SSM gazette strike-off notice.
Risk of false declaration in the application is an offense.
Company can potentially be reinstated within 7 years.
Does not involve liquidators.

Winding Up:

Governed under Section 439(1)(b) of the Companies Act 2016.
Suitable for solvent companies or where assets, liabilities, and creditor claims must be properly handled.
Requires a special resolution, Declaration of Solvency, and appointment of a liquidator.
Involves liquidator managing asset disposal, settling creditors, and distributing remaining assets.
Longer process taking 12-24 months.
Higher overall costs
Public notice in both SSM Gazette and local newspapers.
Final dissolution confirmed by liquidator’s final return to SSM.
False declaration of solvency is an offense.
It is an irreversible and formal closure procedure

Particular	Strike Off	Winding Up
Legal Provision	Section 550 CA 2016	Section 439 CA 2016
Eligibility	Dormant, no assets/liabilities	Solvent, assets and liabilities handled
Process	Application, Gazette notice	Liquidator appointed, multiple notices
Public Notice	SSM Gazette only (60 days)	SSM Gazette + local newspaper
Timeframe	6-12 months	12-24 months
Final Result	SSM strike-off notice dissolution	Liquidator's final return dissolution
Legal Risk	False declaration offense	False solvency declaration offense
Reversibility	Can be reinstated within 7 years	Irreversible

In conclusion, striking off is suitable for companies that are inactive, have no creditors or assets, and want a straightforward, cost-effective closure. Winding up is a more formal, comprehensive process required for companies with assets, liabilities, or creditors that need proper settlement before dissolution.

Summary & Topic :

Strike Off is suited for dormant companies with no assets or liabilities. It requires a board resolution, submission of strike-off application to SSM, and publication in the SSM Gazette with a 60-day objection period. The process is faster (6-12 months), simpler, and less costly (~RM 5,600+). It results in company dissolution upon SSM strike-off notice and can be reversed within 7 years. It does not involve liquidators. False declarations in the application are offenses.

Winding Up applies to solvent companies where assets, liabilities, and creditor claims must be properly handled. It requires a special resolution, a Declaration of Solvency, and the appointment of a liquidator who manages asset disposal, creditor settlements, and asset distribution. It takes longer (12-24 months) and costs more. Public notices are published in both the SSM Gazette and local newspapers. Dissolution is finalized upon the liquidator’s final return. False declarations of solvency are offenses. The process is irreversible

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