Liquidation, striking off and deregistration: closing a solvent Rwandan company by voluntary liquidation under Law N° 075/2021 or removal from the register under the Companies Law, the liquidator's duties and deadlines, striking off by the Registrar General, State vesting and restoration, RRA de-registration, RDB notice, employees and repatriating what is left

The routes out, and which law governs each

Closing a Rwandan company involves two statutes. Law N° 075/2021 of 06/12/2021 relating to insolvency (Official Gazette n° Special of 30/12/2021), in force since 30 December 2021, governs liquidation of both insolvent companies and companies that are not insolvent: its scope expressly includes 'voluntary liquidation of a company and a partnership that are not insolvent' (Article 2(4)). Law N° 007/2021 of 05/02/2021 governing companies, as amended by Law N° 019/2023 of 30/03/2023, governs the removal of a company from the register of companies, the consequences of removal and restoration (Articles 208 and 280 to 289). A solvent wind-down therefore runs under the insolvency law even though nobody is insolvent, and ends under the Companies Law when the Registrar General strikes the company off.

In practice there are four routes. A members' voluntary liquidation, in which the shareholders appoint a licensed insolvency practitioner to realise the assets, pay the creditors and distribute the balance, suits a company with assets, contracts, employees or creditors to deal with. A removal on request under Articles 208 and 281, with no liquidator, suits a company that has already stopped trading, paid everyone and distributed its assets. A striking off by the Registrar General under Article 281 happens to companies that stop filing, and is a risk rather than a method. And a company that cannot pay its debts goes through the insolvency procedures described in Insolvency and restructuring. A company that wishes to pause rather than close may register as dormant by special resolution and keep filing annual returns (Articles 263 to 268; Compliance calendar after registration).

Voluntary liquidation: appointment, notice and effects

Putting a company into liquidation is a power reserved to the shareholders by special resolution (Article 191(5) of the Companies Law), which needs 75% of the votes cast unless the articles set a higher majority. Under Article 103 of the insolvency law, a liquidator is appointed by the shareholders by special resolution, by the directors or any other person if the incorporation documents require or permit it, or by the court, and the appointment has no effect unless the person has consented in writing. A company is put into liquidation by the appointment of a liquidator, and the liquidation commences on the date of appointment (Article 102). The liquidator must be an insolvency practitioner, and no one may act as one unless licensed (Article 231); acting without qualification is an offence punishable by six months to two years' imprisonment and a fine of RWF 500,000 to RWF 2,000,000, or one of these penalties (Article 263). A creditor of the company or of a related company, and anyone who has been a shareholder, director or auditor of the company or a related company within the previous two years, may not be its liquidator (Article 232), so the group's finance director or the company's auditor cannot take the role. Creditors may ask the court to replace the appointed liquidator within 15 working days on reasonable grounds (Article 103).

Within five working days of starting, the liquidator gives public notice of the liquidation, stating the commencement date, the liquidator's full name and office address, and delivers a copy to the Registrar General (Article 106); from then on every invoice, order and business letter must state 'in liquidation' after the company's name. The effects are immediate (Article 107): the liquidator takes custody and control of the company's property; the officers remain in office but lose their powers except as the Law permits; no enforcement or legal process may be started or continued against the company without the liquidator's written consent or a court order, although a secured creditor may still take possession of and realise its security; no share may be transferred and no shareholder's rights or liabilities altered; shareholders may not exercise their powers under the articles; and the articles may not be changed, except that the liquidator may move the registered office. Present and former directors, the secretary and employees must disclose all the company's property and disposals outside the ordinary course of business and deliver property and records to the liquidator (Article 117).

Running the liquidation: reports, claims and distribution

The liquidator's duties are to collect, realise and distribute the assets or their proceeds; take custody of all the assets; keep the company's money separate; keep full accounts and records of the liquidation for at least ten years after it ends; and allow inspection by a committee of inspection and, if the court orders, by a creditor or shareholder (Article 113). Within 20 working days of commencement, the liquidator sends every known creditor and shareholder a report on the state of the company's affairs, proposals for conducting the liquidation and its estimated completion date, with a notice of their right to require a creditors' meeting (Article 110); within 20 working days after each six-month period, an interim report goes to creditors, shareholders and the Registrar General (Article 111). Two or more creditors or shareholders may require a meeting, on at least five working days' notice, including to appoint a committee of inspection of at least three members (Articles 128 and 130). The liquidator may disclaim onerous property, such as an unprofitable lease, leaving the counterparty to claim as a creditor (Article 116), and may require anyone with knowledge of the company's affairs to give information (Article 115).

Claims are valued at the commencement date and interest after commencement is not admissible (Article 204); mutual debts are set off (Article 206); and an unsecured creditor may claim without formality unless the liquidator requires a statutory declaration (Article 207). A rejected claimant may submit a revised claim within ten working days and apply to the court within 21 working days of receiving the liquidator's written reasons (Article 209). In a solvent liquidation all creditors are paid in full, but the statutory order in Article 212 still governs the sequence, beginning with the costs of the liquidation and the liquidator's fees. The surplus is then distributed among the shareholders in accordance with the incorporation documents and the applicable laws (Article 213). Before the end, the liquidator sends creditors and shareholders a completion report with the final report and accounts and a summary of the grounds on which they may object to removal of the company from the register (Article 112). The liquidation is complete when the liquidator delivers to the Registrar General a final report, final accounts and a statement that all known assets have been disclaimed, realised or distributed, all proceeds distributed, and the company is ready to be removed; the liquidator then ceases to hold office (Article 109), and the Registrar General removes the company (Article 281(5)).

A solvent wind-down, in order

1. Board review and solvency checkConfirm the company can pay all its debts in full; if not, the insolvency procedures apply instead. Draw up a closure budget covering employees, tax, landlords and contracts.
2. Notify RDB if a registered investorInform RDB in writing within 30 days before terminating operations, stating the change (Article 27 of Law N° 006/2021); RDB acts on the investment certificate under Article 28.
3. Deal with the workforceFor dismissals on economic grounds, inform employee representatives and then the labour inspector in writing, give notice of 15 or 30 days according to service, pay terminal benefits of at least two months' average salary within seven working days (Labour Law Articles 21, 22, 24 and 31), and inform DGIE when a foreign employee's contract ends.
4. Pass the special resolutionShareholders resolve to liquidate and appoint a licensed insolvency practitioner who has consented in writing (Companies Law Article 191(5); insolvency law Articles 102 and 103).
5. Public notice within five working daysThe liquidator publishes notice and delivers a copy to the Registrar General (Article 106); 'in liquidation' appears on all documents.
6. Preliminary report within 20 working daysSent to every known creditor and shareholder with the right to call a creditors' meeting (Article 110); interim reports follow every six months (Article 111).
7. Realise assets and settle claimsCollect debts, sell assets, disclaim onerous contracts, admit or reject claims (Articles 113, 116, 204 to 209), pay RSSB contributions and file the final tax returns.
8. Tax on the distributionTreat the surplus as a dividend in the final tax period (Article 55 of the Income Tax Law), withhold tax where due and obtain RRA's liquidation-related clearances.
9. Distribute and repatriatePay the surplus to the shareholders under the articles (Article 213); a foreign shareholder may repatriate it under Article 12 of the Investment Code with bank documentation of the source of funds.
10. Final report and removalDeliver the final report, final accounts and statement to the Registrar General (Article 109); the company is removed (Article 281(5)) and de-registered for tax on RRA's E-tax portal.

Removal from the register without a liquidator

A company that has already wound down its business may skip the liquidation. Article 191(6) reserves to the shareholders, by special resolution, the power to apply for the company, when solvent, to be removed from the register, and Article 208 sets two alternative grounds: that the company has ceased to carry on business, has discharged in full its liabilities to all known creditors and has distributed its surplus assets in accordance with its incorporation documents or the insolvency law; or that the company has no surplus assets after paying its debts in full or in part and no creditor has applied to the court for an order putting it into liquidation. The request is made in the form approved by the Registrar General, by a shareholder authorised by special resolution or by the board where the articles permit (Article 281(3)), and must be accompanied by a written notice from the Rwanda Revenue Authority stating that it has no objection to the removal (Article 281). RDB's online page on company deregistration was unavailable when checked for this guide, so the supporting documents ORG currently expects, beyond the special resolution and the RRA's no-objection, and any fee, should be confirmed with the Office of the Registrar General (ORG) before filing; a recent tax clearance certificate is commonly supplied as well.

The Registrar General does not remove the company at once. Under Article 282, notice of the intended removal goes to the company, to every secured party with a registered interest in its property and to the RRA, and public notice is given within 30 days, stating the grounds and a date for objections at least 20 working days after the notice. Any person may object on the grounds that the company is still carrying on business, is a party to legal proceedings, is in receivership or liquidation, owes an undischarged claim to the objector, has a right of action the objector wishes to pursue, or that removal would not be just and equitable (Article 283). An objection on the first three grounds stops the removal unless it is withdrawn, untrue or vexatious; on the others, the objector must within 30 days show that it has applied to the court for liquidation or for an order that the company not be removed, failing which the Registrar General proceeds (Articles 284 and 285). The second ground in Article 208, removal with no surplus after paying debts 'in full or in part', is not a way to escape creditors: an unpaid creditor can object and seek liquidation, and directors' liability survives removal.

Striking off by the Registrar General, and what follows removal

The Registrar General also removes companies on his or her own initiative where satisfied that a company has ceased to carry on business with no proper reason to continue in existence, has failed to pay fees due under the Law, or has not filed its annual return (Article 281(2)), after the same notice procedure. The scale is considerable: the OECD Global Forum's 2024 review records 7,810 companies removed by 30 June 2024, with 5,622 inactive companies still on the register. A foreign company's branch is removed where it does not reply within three months to an enquiry from the Registrar General or gives notice that it has ceased business in Rwanda (Article 256), and where a foreign company goes into liquidation or is dissolved in its home country, its authorised agent in Rwanda must notify the Registrar General (Article 118 of the insolvency law).

Removal has three consequences that investors often overlook. First, the company ceases to exist, but the liability of any former director or shareholder, or any other person, for acts or omissions before removal continues and may be enforced as if the company had not been removed (Article 280); tax and labour claims against directors can therefore survive. Second, any property not distributed or disclaimed before removal, including leasehold property and other rights vested in the company, is treated as unclaimed and vests in the State (Article 286). A forgotten bank account, a land lease or an intellectual property registration in the name of a struck-off company passes to the State; the Registrar General may disclaim onerous property, and a person who would have been entitled to the property may apply to the court for it to be vested in them or for compensation. Third, the company's records must be filed with the Registrar General within 30 days of the company ceasing to exist, by its secretary, directors or liquidator (Article 111, as amended).

Restoration to the register

Removal can be reversed, within limits. Under Article 287 as amended by Law N° 019/2023, the Registrar General may restore a company, on his or her own initiative or on application by a shareholder, director, creditor or liquidator who pays the prescribed fee, where satisfied that after removal the company was still carrying on business or another reason existed for it to continue, was a party to legal proceedings, or was subject to an insolvency process. The applicant pays for a notice in two daily newspapers with wide circulation, stating the company, the applicant and the grounds, with a date for objections not less than 30 days after the notice; an objection within that period prevents restoration by the Registrar General. Before restoring, the Registrar General requires the company to comply with the obligations it had failed to meet before removal.

The court may also restore a company under Article 288 as amended, on application by a former shareholder, director, creditor, party to legal proceedings, person with an undischarged claim, liquidator, the Registrar General or anyone with the court's leave, on wider grounds, including that it is just and equitable, and may give directions to place the company as nearly as possible in the position it would have been in had it not been removed. Since the 2023 amendment, no company may be restored once ten years have elapsed since it was deregistered, either by the Registrar General or by the court. Restoration is the route to recover property that vested in the State, pursue a claim in the company's name or defend proceedings, but it brings back the obligation to file every missed return and annual return.

Tax, RDB, employees and the money that is left

Tax. Changes affecting tax registration must be reported to the RRA within seven days (Article 11 of Law n° 020/2023 of 31/03/2023 on tax procedures). RRA de-registration is applied for on the E-tax portal: the taxpayer must be up to date with all returns and accounts, at a zero balance, and the business must be non-operational; for a company dissolved by a competent authority, a certificate of liquidation is needed, and RRA states that the liquidation certificate should be issued before the company's de-registration. The answer is immediate, and de-registration takes effect on the issue of the de-registration letter. A taxpayer with arrears that chooses to proceed receives a 'Semi-Dormancy' approval letter and the full de-registration letter only when the arrears are paid. De-registration may be made tax by tax, for example ending VAT while PAYE continues during the wind-down. The tax clearance certificate, which costs RWF 5,000, is valid for three months and is issued online once arrears are cleared, is a separate document often needed for the removal request.

Under Article 55 of Law nº 027/2022 of 20/10/2022 establishing taxes on income, on the liquidation of a business entity, after payment of liabilities and 'distribution of shares', the remainder is considered as dividends on shares in the last tax period of the entity's existence (Capital gains, property and other taxes). A payment treated as a dividend to a non-resident shareholder bears withholding tax at 15% unless a treaty or an Investment Code rate reduces it (Withholding taxes and tax treaties). The Law does not define how much of a liquidation distribution is a return of capital rather than a deemed dividend, and the point should be agreed with the RRA before the final distribution.

RDB and repatriation. A registered investor must inform RDB in writing within 30 days before it suspends or terminates its investment operations, and an interested person affected by the termination may also notify RDB (Article 27 of Law N° 006/2021 of 05/02/2021 on investment promotion and facilitation). Proceeds from the liquidation of an investment may be transferred abroad once tax obligations are met (Article 12; FAQ 61), and the bank will ask for documents showing the source of the funds and the tax position (Repatriating profits and capital). Employees and RSSB. Closure is an economic termination: employee representatives and then the labour inspector must be informed in writing, notice given, and terminal benefits paid within seven working days (Articles 21, 22 and 31 of Law N° 66/2018 of 30/08/2018 regulating labour in Rwanda; Termination, severance and redundancy). No published RSSB procedure for closing an employer account was found; all contributions should be declared and paid to the date of the last payroll and the closure confirmed with the Rwanda Social Security Board (RSSB) in writing.