Striking Off refers to the process of removing a company’s name from the official register maintained by the Accounting and Corporate Regulatory Authority (ACRA) in Singapore. Understanding the concept of striking off is important for businesses considering closure or deregistration, as well as for professionals involved in company administration and compliance matters.

Overview of Striking Off

Striking Off is typically initiated when a company decides to cease its operations or when it no longer serves a viable business purpose. Key points about striking off include:

  1. Voluntary or Compulsory: Striking Off can be voluntary, initiated by the company’s directors or shareholders, or compulsory, initiated by ACRA or other regulatory authorities for non-compliance or other reasons.
  2. Application Process: For voluntary striking off, the company must submit an application to ACRA, along with the required documentation and compliance certificates, declaring that it has ceased business operations and has no outstanding liabilities.
  3. Public Notice: Upon acceptance of the striking off application, ACRA publishes a notice in the Government Gazette to inform creditors, stakeholders, and the public of the company’s impending striking off.

Implications of Striking Off

  • Legal Dissolution: Striking Off results in the dissolution of the company as a legal entity, terminating its existence and corporate status. Once struck off, the company ceases to exist as a separate legal entity.
  • Cessation of Rights and Obligations: Upon striking off, the company loses its legal capacity to enter into contracts, incur liabilities, or undertake any business activities. Any existing contracts or obligations are deemed terminated.
  • Asset Distribution: Any remaining assets of the struck-off company are vested with the government, subject to certain statutory provisions. Creditors and stakeholders may make claims for outstanding debts or assets during the striking off process.

Voluntary Striking Off Process

  1. Board Resolution: The directors of the company must pass a resolution to strike off the company and appoint a qualified person, such as a company secretary, to oversee the striking off process.
  2. Clearance of Obligations: The company must settle all outstanding liabilities, including taxes, debts, and employee entitlements, and obtain relevant clearance certificates from government agencies.
  3. Application Submission: The company submits the striking off application to ACRA, accompanied by the required documentation and compliance certificates.

Striking Off is a formal process by which a company’s name is removed from the official register, signaling the cessation of its operations and legal dissolution. By understanding the implications and procedures of striking off, businesses can effectively manage closure processes, comply with regulatory requirements, and facilitate the orderly winding up of affairs.