Winding up petition in Scotland

We are a Scottish registered company and a creditor has threatened a winding up petition. Is the procedure in Scotland different from England?

Yes. If a creditor issues a winding up petition your options are even more limited than in England.

The reason is to do with the advertisment of the petition.

To summarise, in England after the Winding Up Petition has been served, advertising cannot take place for seven days. Please note that for the Petition to proceed it must be advertised not less than 7 days after service and at least 7 days before the Hearing. It is the advertising that can be the end of the company. Banks have a continual watching brief on the Gazette, where it is advertised. Once advertised they will almost certainly freeze the company’s bank account, often the end of the company.
The reason behind the freezing is logical. If the WUP is ultimately granted, any dispositions which take place after the service of the Petition are void/voidable. Therefore the company’s transaction through its bank account following service could be clawed back.

In Scotland however:-

The Winding Up Petition dates from the presentation of the Petition at the court offices, when it is lodged. A first Order is given. This first order is the authority to serve and advertise. At the same time it is “walled”. Walling literally means that the Notice is pinned to the Court Notice board for all to see. It should be noted that the minimum debt is £1500 in Scotland.

The Respondent has 8 days to lodge defences but there is NO delay period for advertising. The Petition is advertised at the same time as service. No opportunity is given to negotiate time to prepare a CVA proposal document. Instead the bank accounts are instantly frozen and the road wide open to liquidation.


One unfortunate side effect of this loss of grace period is that a petition may be issued maliciously and so damage the company. We advise clients in Scotland to lodge a caveat in both their local Sheriff court and the Court of Session. The effect of the caveat is that the court is required to notify the party who has lodged the caveat of the intention to proceed with the Winding Up. Then a Hearing will be fixed. If it is in a busy Sheriff court then the hope is that the Hearing might be a few weeks off. In a less busy court the opposite is the case. The important point is that some notice is given.
So if you feel under threat then DO NOT DELAY and talk to Eirlys Lloyd our expert advisor on these matters on 0131 242 0081 or 0800 9700539