Phoenix Companies - What can you do?

Re-Use Of Company Names

It is not permissible for a Director of a company that has gone into liquidation using one company name or trading style, to then re-use the same or similar name within the five years of going into liquidation.

There are some exceptions and it is possible for a Director to re-use such a company name but the relevant rules must be strictly complied with. Therefore a Director who wishes to re-use such a company name ought to take professional advice to see if they can satisfy the procedures.

However, generally, it will be a criminal offence under Section 216 of the Insolvency Act 1986 for a Director who cannot show that they have satisfied the requirements if they continue to re-use such a prohibited name.

There is a very real risk that if a Director does re-use the prohibited company name and if the new company goes into liquidation also, that the Director will be personally liable for the debts arising from the new trading company.