2 min read
Definition
A phoenix company describes the situation where a company fails, and a new company — frequently run by the same directors — acquires its business or assets and carries on trading. It is lawful in itself, but tightly regulated.
In plain terms
Think of a failed business rising again in new corporate clothes. Done properly it's a legitimate restart; done to dodge creditors or mislead them, it crosses legal lines.
Why it matters for your company
The Insolvency Act restricts directors of the failed company from reusing a prohibited trading name for five years without following a formal procedure. Breach carries personal liability and possible disqualification.
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Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.