Voluntary Liquidation Resolution (Nigeria)
SPECIAL RESOLUTION FOR VOLUNTARY WINDING UP
Companies and Allied Matters Act 2020 (CAMA 2020), Part F, Section 620
Company: [Company Name] (RC No. [CAC Number])
Registered Office: [Registered Address]
NOTICE OF [Meeting Type]
A [Meeting Type] of the members of [Company Name] was duly convened and held on [Meeting Date] at [Meeting Location], with at least 21 days' written notice given to all members in accordance with Section 240 of CAMA 2020, and was chaired by [Chairperson Name].
SPECIAL RESOLUTION
AT the [Meeting Type] of [Company Name] held on [Meeting Date], the following Special Resolution was duly passed by not less than three-quarters (75%) of the members present and voting, in accordance with Section 620 of the Companies and Allied Matters Act 2020:
"THAT [Company Name] (RC No. [CAC Number]) be wound up voluntarily pursuant to Part F of the Companies and Allied Matters Act 2020 (CAMA 2020), and that this voluntary winding up shall be a [Winding Up Type] winding up."
"THAT [Liquidator Name] of [Liquidator Address], [Liquidator Qualification], be and is hereby appointed Liquidator of [Company Name] for the purposes of winding up the affairs and distributing the assets of the Company."
The resolution was passed on [Resolution Date] and certified as a true copy by [Chairperson Name], Chairman of the meeting.
DECLARATION OF SOLVENCY (MEMBERS' VOLUNTARY WINDING UP)
In connection with the above resolution for members' voluntary winding up, a Statutory Declaration of Solvency was made by a majority of the directors of [Company Name] on [Solvency Declaration Date] in accordance with Section 624 of CAMA 2020, declaring that the directors have inquired into the affairs of the Company and have formed the opinion that the Company will be able to pay its debts in full within twelve months from the commencement of the winding up.
FILING AND PUBLICATION
This Special Resolution shall be filed with the Corporate Affairs Commission (CAC) within 14 days of the date of passing, in accordance with Section 621 of CAMA 2020, and shall be published in at least one national daily newspaper and in the CAC Official Gazette in accordance with Section 623 of CAMA 2020.
Chairman of the Meeting
________________
Signature
Liquidator (acceptance)
________________
Signature
What Is a Voluntary Liquidation Resolution (Nigeria)?
A Voluntary Liquidation Resolution in Nigeria records the decisions taken by a company's directors or members and authorises the resulting actions.
CAMA 2020 recognises two types of voluntary winding up: a members' voluntary winding up (where the company is solvent and the directors can make a statutory declaration of solvency under Section 624 of CAMA 2020) and a creditors' voluntary winding up (where the company cannot pay its debts in full and the creditors take control of the process under Sections 638 to 652 of CAMA 2020). A Voluntary Liquidation Resolution is the initiating document for both types and must be passed as a special resolution by not less than three-quarters of the members present and voting at a general meeting duly convened with at least 21 days' notice under Section 240 of CAMA 2020.
Once the special resolution is passed, the company must file the resolution with the CAC within 14 days under Section 621 of CAMA 2020, and must advertise the resolution in at least one national daily newspaper and in the CAC's official gazette. A liquidator is appointed by the members (in a members' voluntary winding up) or by the creditors (in a creditors' voluntary winding up) to take control of the company's affairs, collect and realise the assets, settle creditor claims in the priority prescribed by CAMA 2020, and distribute any surplus to shareholders.
The CAC's Companies Regulations 2021 prescribe the forms and procedures for voluntary liquidation under CAMA 2020, including Form CAC 10.1 (Statutory Declaration of Solvency), Form CAC 10.2 (Notice of Appointment of Liquidator), and Form CAC 10.15 (Final Return by Liquidator). The process typically takes six months to two years for straightforward members' voluntary liquidations and longer for complex creditors' voluntary liquidations.
The legal framework governing the Voluntary Liquidation Resolution (Nigeria) in Nigeria draws on several key statutes and regulatory bodies. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Parties executing a Voluntary Liquidation Resolution (Nigeria) in Nigeria should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Companies and Allied Matters Act (CAMA) 2020 sets the foundational requirements.
When Do You Need a Voluntary Liquidation Resolution (Nigeria)?
A Voluntary Liquidation Resolution is required in Nigeria when the shareholders of a company decide to wind up and dissolve the company through a formal voluntary process under CAMA 2020.
A voluntary liquidation resolution is needed when a solvent company has achieved its objects, completed a project, or the shareholders have decided for commercial or personal reasons to cease business and wish to distribute the company's remaining assets to shareholders in an orderly and tax-efficient manner.
A voluntary liquidation resolution is required when a holding company restructures its group by dissolving subsidiary companies that are no longer needed for the group's operations, using the members' voluntary winding-up process under Sections 624 to 637 of CAMA 2020 to close dormant or redundant entities.
A voluntary liquidation resolution is needed when a joint venture company formed by two or more parties for a specific project has completed the project and the parties wish to wind up the joint venture company and distribute the profits, as agreed in the original joint venture agreement.
A voluntary liquidation resolution is required when a company is insolvent and the directors, after concluding that the company cannot pay its debts, convene a meeting of creditors under Section 638 of CAMA 2020 to initiate a creditors' voluntary winding up, which is preferable to court-ordered winding up from a cost and control perspective.
A voluntary liquidation resolution is needed when a Nigerian company that has failed to file annual returns with the CAC for three or more years — and faces the risk of administrative strike-off under Section 692 of CAMA 2020 — decides to regularise its affairs through a formal voluntary winding up rather than accepting an involuntary dissolution.
Parties in Nigeria should prepare a Voluntary Liquidation Resolution (Nigeria) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.
What to Include in Your Voluntary Liquidation Resolution (Nigeria)
A Nigeria Voluntary Liquidation Resolution and supporting documents must contain the following essential elements to comply with CAMA 2020 and the CAC Companies Regulations 2021.
Company Identification: Full legal name, CAMA 2020 RC number, registered office address, and the nature of the company's business as stated in the Memorandum of Association.
General Meeting Details: Date, time, place, and type of meeting (Annual General Meeting or Extraordinary General Meeting) at which the resolution was passed, together with confirmation that at least 21 days' written notice was given to all members under Section 240 of CAMA 2020.
Special Resolution Text: The precise text of the special resolution passed by not less than three-quarters of the members present and voting, stating that the company shall be wound up voluntarily under Part F of CAMA 2020. The resolution must be in writing and signed by the chairman of the meeting.
Declaration of Solvency (Members' Voluntary Winding Up): Where the winding up is a members' voluntary winding up, the statutory declaration of solvency made by the majority of the directors not more than five weeks before the date of the resolution under Section 624 of CAMA 2020, declaring that the directors have inquired into the company's affairs and have formed the opinion that the company will be able to pay its debts in full within a period of twelve months from the commencement of the winding up.
Appointment of Liquidator: The name, address, and professional qualifications of the liquidator appointed by the members to wind up the company. The liquidator must be an Insolvency Practitioner registered with the CAC under CAMA 2020 or a lawyer, accountant, or other suitably qualified professional.
Notice of Meeting to Creditors: For a creditors' voluntary winding up, the notice of the creditors' meeting convened under Section 638 of CAMA 2020 simultaneously with or within one day of the members' meeting, to allow creditors to nominate their preferred liquidator.
Filing and Publication Obligations: Acknowledgement that the special resolution must be filed with the CAC within 14 days of passing under Section 621 of CAMA 2020, and advertised in a national daily newspaper under Section 623 of CAMA 2020.
Additional compliance elements for a Voluntary Liquidation Resolution (Nigeria) used in Nigeria include: Under Nigerian law, the Companies and Allied Matters Act 2020 (CAMA) regulates corporate entities through the Corporate Affairs Commission (CAC). The Labour Act (Cap L1 LFN 2004) and the National Industrial Court of Nigeria (NICN) govern employment disputes. The Nigeria Data Protection Regulation (NDPR) 2019 and the Nigeria Data Protection Commission (NDPC) protect personal data. The Federal Inland Revenue Service (FIRS) administers tax obligations under the Companies Income Tax Act. The Federal High Court and state High Courts have jurisdiction over civil matters. Forms-legal.com provides this template as a starting point for Nigeria-compliant documentation.
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year = {2026},
howpublished = {\url{https://forms-legal.com/nigeria/business/corporate/voluntary-liquidation-resolution-nigeria}},
note = {Free legal document template. Based on Companies and Allied Matters Act (CAMA) 2020}
}Frequently Asked Questions
Voluntary liquidation and compulsory (court-ordered) liquidation are the two principal methods by which a company may be wound up in Nigeria under CAMA 2020. In a voluntary liquidation under Section 620 of CAMA 2020, the shareholders initiate the winding-up process themselves by passing a special resolution, without court involvement unless disputes arise. The process is faster, less expensive, and gives the directors and shareholders greater control over the appointment of the liquidator and the sequencing of asset realisations. In a compulsory liquidation under Section 568 of CAMA 2020, a creditor, contributory, or the Corporate Affairs Commission applies to the Federal High Court for a winding-up order, typically on the grounds that the company is unable to pay its debts. A court-appointed Official Receiver takes control of the company's affairs, and the process is governed by the courts and subject to court supervision throughout. Compulsory liquidation is generally slower and more expensive than voluntary liquidation and removes control entirely from the directors and shareholders. Directors who are aware that a company cannot pay its debts should initiate a creditors' voluntary winding up rather than allow a compulsory winding-up petition to be presented, to preserve goodwill and avoid personal liability for wrongful trading under Section 283 of CAMA 2020.
A declaration of solvency under Section 624 of the Companies and Allied Matters Act 2020 (CAMA 2020) is a formal statutory declaration made by a majority of the directors of a Nigerian company before the shareholders pass a special resolution for voluntary winding up, stating that the directors have inquired into the company's affairs and have formed the opinion that the company will be able to pay its debts in full within a period not exceeding twelve months from the commencement of the winding up. The declaration must be made at a directors' meeting held not more than five weeks before the date of the special resolution and must be delivered to the Corporate Affairs Commission (CAC) before or on the date the special resolution is passed. A director who makes a declaration of solvency without having reasonable grounds for the opinion expressed is guilty of a criminal offence under Section 625 of CAMA 2020 and is personally liable for a fine. If the company is found to be unable to pay its debts within the twelve-month period, the voluntary winding up converts from a members' voluntary winding up to a creditors' voluntary winding up under Section 636 of CAMA 2020. The declaration of solvency is filed with the CAC using Form CAC 10.1.
The duration of a voluntary liquidation process in Nigeria under CAMA 2020 depends on the complexity of the company's affairs, the number and value of assets to be realised, and the number of creditors to be settled. A straightforward members' voluntary liquidation of a small company with few assets and no creditor disputes typically takes six to twelve months from the date of the special resolution to the submission of the final return by the liquidator to the CAC and the formal dissolution of the company. More complex members' voluntary liquidations — involving property, long-term contracts, litigation, or regulatory licences to be surrendered — may take twelve to twenty-four months. Creditors' voluntary liquidations, where the liquidator must convene creditors' meetings, adjudicate claims, and potentially litigate disputed debts under the priority rules in Section 718 of CAMA 2020, typically take two to four years or longer for large companies with significant liabilities. The liquidator must submit annual progress reports to the CAC under Section 673 of CAMA 2020, and a final account and return under Sections 675 and 676 upon completion. The CAC formally dissolves the company three months after receiving the final return, under Section 677 of CAMA 2020.
Voluntary liquidation of a Nigerian company triggers several tax obligations that must be addressed before the company can be formally dissolved. The company must file final Companies Income Tax (CIT) returns under the Companies Income Tax Act (Cap C21, LFN 2004) for all outstanding tax years up to the date of cessation of business, and obtain a tax clearance certificate from the Federal Inland Revenue Service (FIRS) confirming no outstanding CIT liabilities. VAT obligations must be settled — the company must file final VAT returns (Form 002) and deregister from VAT under the Value Added Tax Act (Cap V1, LFN 2004). Capital Gains Tax (CGT) at 10% under the Capital Gains Tax Act (Cap C1, LFN 2004) as amended by the Finance Act 2021 applies to gains realised on disposal of the company's chargeable assets during the liquidation — including property, equipment, and investments. Where a surplus is distributed to shareholders after settling all debts, the surplus may constitute a deemed dividend subject to withholding tax at 10% under the CIT Act if the shareholders are Nigerian residents, or at treaty rates for non-resident shareholders. The liquidator must obtain a No-Objection Letter from FIRS confirming tax clearance before the CAC will accept the final liquidation return and formally dissolve the company.
Under CAMA 2020, a company in voluntary liquidation in Nigeria may continue to carry on its business only to the extent necessary for the beneficial winding up of the company — not for any purpose beyond the orderly realisation of assets and settlement of liabilities. Section 644 of CAMA 2020 provides that the voluntary winding up does not affect the legal personality of the company or its capacity to sue and be sued, but the liquidator takes over management of the company's affairs from the directors, who cease to exercise powers except as specifically authorised by the liquidator or by the members in general meeting. Continuing trading beyond what is necessary for the winding up — for example, entering new long-term contracts, taking on new employees, or incurring new debt — is not permitted and may expose the liquidator to personal liability. Where the liquidator determines that the business has significant going-concern value, they may arrange for the sale of the business as a going concern to a third party as part of the liquidation, which is a common outcome in members' voluntary liquidations. Any trading contracts entered into by the company after the special resolution for voluntary winding up are the personal liability of the liquidator if entered into without authority.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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