The MVL allow directors of solvent company to close the business and distribute excess assets without going through the court. The liquidators’ duties are to ensure that all paperwork comply with the law and liabilities are paid in full and any remaining assets be distributed to shareholders. Amount distributed to shareholders are tax exempt.

The CVL enable the directors to formally close an insolvent company without going through the court following the inability of the company to pay its debts in full. This type of winding up allows the directors to nominate their own licensed liquidators subject to consent of creditors. The liquidators will guide the directors in every step of the CVL procedures until the company being classified by Companies Commission of Malaysia as “dissolved”.

This type of liquidation initiated by creditors followed by winding up order by the court due to the failure of the company to pay its debts after being demanded for several times.

The liquidators duties are similar to those as in Creditors Voluntary Liquidation with the exception that the Official Receiver may investigate directors’ conduct.

The directors can apply for company strike off if the company met the criteria set by the Companies Commission of Malaysia.

The Company Commission of Malaysia can also strike off companies if they believed the company no longer active and do not own assets and do not have liabilities. This type of closure option is the cheapest but have two main short comings namely that creditors can reinstate the company and the distribution of excess assets are subjected to tax.