Creditors’ Voluntary Liquidation Administration

Creditors' Voluntary Liquidation (CVL) is a process where a company that cannot pay its debts decides to wind up its operations. In this scenario, the company’s directors propose liquidation to its creditors, seeking their approval to settle debts through selling off assets. An appointed liquidator manages the process, ensuring that creditors receive payments based on the available funds. Unlike other forms of liquidation, CVL is initiated by the company itself, reflecting its decision to cease trading while trying to minimize losses for creditors. This helps in orderly dissolution rather than forcing the company into more chaotic insolvency proceedings.