The two available types of liquidation are:
- liquidation by the court (compulsory liquidation)
- voluntary liquidation instigated by the directors, the members or the creditors
It is important to recognise that not all liquidations are insolvent liquidations. There are many differences between these procedures however they are both designed to achieve the same end result; to collect and distribute the assets of the company. When liquidation comes to an end the company may be dissolved and will no longer exist as a commercial entity.
Legislative provisions for liquidation are found in Part IV of the 1986 Act.
The Limited Liability Partnerships (Scotland) Regulations 2001 makes provision for the winding up and insolvency of Limited Liability Partnerships.