The Companies Act states that directors can be held personally liable for all debts that arise after the equity of a company has fallen below 50% of the registered share capital. In such circumstances the board of directors has a duty to act in order to avoid personal liability. In a recent case the Court of Appeal had to consider how a new board of directors in a company with insufficient capital should act.
Article by Wistrand senior associate Sara Lööf published in the Insolvency & Restructuring Newsletter, March 3 2012.
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