Important notice: This article provides general educational information only. It is not legal or tax advice and does not guarantee any particular outcome. The applicable process depends on the company’s legal form and circumstances, so the current legislation, official forms, and filing requirements should be reviewed before action is taken.

The question How is a company liquidated in Jordan, and what rights do shareholders and creditors have? involves more than a decision to stop trading. Liquidation requires the company’s assets and liabilities to be dealt with, creditor claims to be addressed, contracts and official records to be reviewed, and the relevant steps with the Companies Control Department to be completed. This article presents the general framework reflected in the official material available as of 15 September 2026.

How is a company liquidated in Jordan?

A liquidator reviews company assets, liabilities, creditor claims, and final reports

Under the Companies Law framework, liquidation is the process of bringing the company’s business to an end, settling its assets and liabilities, and ultimately striking its registration. Voluntary liquidation does not, by itself, establish that the company is insolvent. A company may enter voluntary liquidation for reasons unrelated to an inability to pay its debts.

According to the Companies Control Department’s official rules, voluntary liquidation of a public shareholding company, private shareholding company, or limited liability company begins with a resolution of the general assembly in an extraordinary meeting. The resolution must state the reasons for liquidation and appoint a liquidator. Partnerships and limited partnerships are liquidated by agreement among the partners to dissolve and liquidate the company, appoint a liquidator, and determine the liquidator’s remuneration.

The competent authority and the liquidator

The Companies Control Department, through its Liquidation Unit, reviews the procedures, documents, and final reports. After the company submits the general assembly minutes electronically, together with the liquidator’s consent to the appointment, and pays the prescribed fees, the company’s status changes to “under liquidation” under the official rules.

The resolution or agreement should be consistent with the company’s legal form and should clearly address the appointment. The relationship with the liquidator, including the scope of the appointment and remuneration, should also be documented in the approved resolution or agreement.

Liquidation versus insolvency

Voluntary liquidation should not be confused with insolvency proceedings. Article 3(c) of Jordan’s Insolvency Law No. 21 of 2018 states that the Law does not apply to liquidation proceedings conducted under the Companies Law for reasons unrelated to insolvency.

Under the official definition, insolvency exists where the debtor has stopped or is unable to pay due debts regularly, or where total liabilities exceed the total value of assets. The definition also covers imminent insolvency, where the debtor is expected to lose its future ability to pay debts as they fall due within six months, despite being currently able to pay.

Within insolvency proceedings, the liquidation stage begins when the debtor’s business cannot continue, or when a reorganisation plan cannot be approved or cannot be implemented after approval. Accordingly, where there are actual or imminent payment difficulties, the company should not automatically choose voluntary liquidation without examining whether the Insolvency Law provides the applicable framework. This distinction is important for creditor protection and the proper treatment of claims.

Public notice, claims, and official documents

The Companies Control Department’s official forms include a form for extraordinary general assembly minutes, liquidator notices, the final liquidation report, general assembly minutes, an agreement among partners for the liquidation of partnerships and limited partnerships, and the closing account for those companies.

The official rules require publication of the liquidation notice using the approved form, followed by republication after fourteen days. The period for submitting claims is calculated from the date of the first notice. The available research material does not state the length of that claims period, so it should be confirmed from the current rule, notice, and official form rather than assumed.

In practical terms, the liquidator must deal systematically with the company’s records, assets, liabilities, and submitted claims, and prepare the final report and, where applicable, the closing account required for the company’s legal form. The Liquidation Unit reviews the final procedures and reports before the official process is completed.

What rights do shareholders and creditors have?

Shareholders and partners

  • They have the right to participate in the decision concerning liquidation in accordance with the company’s legal form: through the general assembly where required, or through a partners’ agreement for partnerships and limited partnerships.
  • They should be able to identify the reasons for liquidation and the appointed liquidator, and follow the reports and documents produced within the applicable process.
  • They can follow the closing account and final liquidation report and understand how liabilities and claims affect any remaining assets.

Being a shareholder or partner does not create an immediate right to receive company funds merely because a liquidation resolution has been adopted. Liquidation first addresses the company’s assets and liabilities; the final financial position determines whether anything remains thereafter.

Creditors

  • Creditors should monitor the liquidation notice and submit their claims within the period and procedure stated in the current rules and forms.
  • They should provide documents supporting the debt and retain evidence of submission or delivery of the claim.
  • They should distinguish voluntary liquidation from insolvency proceedings where the company has stopped paying, cannot pay regularly, or its liabilities exceed its assets.

The existence of a debt does not, by itself, guarantee payment. The claim must be supported and handled through the applicable procedure, while the company’s financial position and any relevant legal rules must also be considered.

Contracts and tax obligations

A liquidation resolution should not be treated as automatically cancelling every contract or obligation. The company’s contracts and outstanding obligations should be identified and reviewed with the liquidator and appropriate advisers, with relevant communications and decisions documented.

As to tax matters, the official research available for this article could not access the Income and Sales Tax Department’s official website to verify detailed requirements, forms, or tax-clearance conditions. This article therefore does not state a specific tax checklist. The current requirements should be confirmed directly with the Income and Sales Tax Department and the Companies Control Department before the relevant filing or closure step.

Frequently asked questions

Does voluntary liquidation mean that the company is insolvent?

No. A company may be liquidated under the Companies Law for reasons unrelated to insolvency. However, actual or expected inability to pay requires an assessment of the insolvency route.

When does the company’s status become “under liquidation”?

Under the official rules, the status changes after the minutes are submitted electronically, the liquidator’s consent is attached, and the prescribed fees are paid.

Is there one fixed period for creditor claims?

The claims period runs from the date of the first notice, but its length should be verified in the current rule, notice, and official form. It should not be inferred from this article.

Does approving liquidation end the company immediately?

No. The process includes dealing with claims and liabilities, preparing the final reports, and completing the Companies Control Department’s review and the related striking-off steps.

A professional review before proceeding

A properly managed liquidation starts by identifying the reason for liquidation and the company’s legal form, then adopting the appropriate resolution or agreement, appointing the liquidator, filing the required documents, publishing the notice, addressing claims, and completing the final reports. Where insolvency indicators exist, voluntary liquidation should not be used as an unexamined substitute for insolvency proceedings. Because legislation and forms may be updated, the current requirements should be checked with the Companies Control Department and the Income and Sales Tax Department, alongside professional legal and accounting review before any step is approved.

Official sources