The implementation of the Company Voluntary Arrangement (CVA) is intended to provide the opportunity for companies to mount a rescue attempt before the liquidation of the company begins. In the Re Arthur Rathbone Kitchens Ltd case, Roger Kaye QC noted that the purpose of the CVA was to allow the company to emerge from insolvency and provide for creditors through staggered payments as it did so.[2] In other words, CVA is an alternative way for companies to recover from debt instead of being liquidated. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essayCVA available only for private companies. This application is applicable to companies that are not regulated by the laws enforced by Bank Negara Malaysia and that of the Capital Markets and Services Act 2007. Furthermore, CVA is eligible for companies that do not create any form of charge or encumbrance on the properties of the company. [3]The CVA can be initiated by the directors, the judicial administrator or the liquidator depending on the conditions of the company.[4] For example, the administrator can propose the CVA to creditors if the company is not in liquidation and is not undergoing judicial management. While the judicial director can do so provided that the company is in the judicial management phase. On the other hand, CVA can also be brought by the liquidator if the company has been liquidated. The CVA proposal must be accompanied by the appointment of a candidate to act as supervisor or trustee for the implementation of the CVA. The nominee must be a person who is an insolvency practitioner.[5] Directors intending to submit a CVA proposal need to submit few documents for candidate review. These documents include the proposed CVA and statement of company affairs.[6]The candidate will then present his views in the form of a statement to the directors. His opinion may include the reasonableness of the proposed CVA for approval and implementation, the sufficiency of the company's funds to manage its assets during the moratorium period and the need to convene a meeting of the company with members and creditors in merit to the proposed CVA.[ 7] When applicants approve the proposed CVA, they will notify the court by submitting a CVA application. During the filing phase several documents need to be submitted to the court which include the proposed CVA, a declaration containing details of the company's affairs, a candidate declaration together with the candidate's consent to act form.[8] For situations where a CVA has previously been proposed, full details of the previous CVA proposal together with its outcome must be submitted to the court together with the previously mentioned documents. After submitting the application, the company is allowed to delay compliance with its legal obligation to make certain payments for 28 days.[9] The period of late payment is known as the moratorium period which automatically begins when you appear in court. It could be extended up to 60 days with the consent of the nominee, members of the company and 75% of the value of the creditor. During this period, the nominee has the power to withdraw his consent for CVA and the duty to monitor the situation of the company. business.[10] The nominee power is included in the Companies Act 2016 unlike the common law which can be seen in the case of Re Ultra Motorhomes International Ltd where Patten J observed that such powers must be included in the proposal itself.[11]The effects of the moratorium provides that no request for liquidation and no request for judicial management be presented.[12] Also, don't.