Petition To stop Phoenix Companies and Prepack Liquidation

Abolishment of the practice of Phoenix Companies – Companies which enter into liquidation to write off their debts and then set up a new company the next day selling the same products also known as Prepack liquidation. The business of ending one company and setting up another selling the same goods has to cease. The moving of assets abroad which are not taken into the liquidated process to then be resued by the new company has to stop. The liquidation of a company usually leaves the investors and shareholders short changed which impacts on the ability to find shareholders willing to invest in new businesses. The impact of this process is to damage the integrity of British businesses so growth is slowed as funding through investors is harder to source. If directors cannot make the first company a success leaving creditors in debt there should not be a second bite of the same cherry. We need responsible trading.