A public interest winding-up petition asks the court to place a company into compulsory liquidation because closing it is considered necessary to protect the public or the wider business community.
Receiving notice of an Insolvency Service investigation or public interest winding-up petition does not automatically mean that misconduct has been proved. Live company investigations are fact-finding exercises, and several outcomes are possible. The Insolvency Service may take no action, issue a warning, refer matters to another regulator or ask the court to wind the company up.
A company and its directors can respond to requests for information, review the allegations and provide evidence explaining how the business operates. Where a petition is presented, the court will decide whether a winding-up order should be made.
The latest figures cover the United Kingdom, while this article explains the legal and practical position for companies and directors in England and Wales.
What do the latest public interest winding-up figures show?
The Insolvency Service’s enforcement outcomes for 2025/26 record 52 companies wound up in the public interest following live company investigations.
- The highest monthly figure was recorded in January 2026, when 12 orders were made.
- Ten orders were recorded in May 2025, while no public interest winding-up orders were recorded in June or December 2025.
- The figures cover the United Kingdom and relate to investigations conducted under section 447(3) of the Companies Act 1985.
The publication also records that
- 273 companies were targeted for live investigation during 2025/26.
- the Insolvency Service concluded 185 live company investigations during the year; and
- 59 live companies remained under investigation as at 31 March 2026.
These figures should not be treated as a direct progression from investigation to winding-up order. An investigation may begin and end in different reporting periods, and the source does not connect individual investigations with particular court outcomes.
The statistics also do not establish that every company investigated had acted improperly. The Insolvency Service may decide that there is insufficient evidence, that another regulator is better placed to act or that a warning is a more proportionate outcome.
The figures nevertheless show that public interest winding up remains an active enforcement tool. It is separate from an ordinary creditor winding-up petition and may create significant consequences for the company and its directors.
What is a public interest winding-up petition?
A public interest winding-up petition is generally presented on behalf of the Secretary of State following an investigation into the activities of a live company.
- Under section 124A of the Insolvency Act 1986, the Secretary of State may present a petition where it appears expedient in the public interest for a company to be wound up. The court must then decide whether it is just and equitable to make the winding-up order.
- This differs from a conventional creditor petition. A creditor will normally present a winding-up petition because a company has failed to pay a debt. A public interest petition is intended to protect the public or business community from continuing corporate abuse.
The Insolvency Service’s live company investigation powers are not designed to recover an individual creditor’s debt or obtain repayment for customers. The investigation considers whether the company’s wider conduct warrants regulatory or court action.
The Insolvency Service may investigate concerns involving
- serious misconduct,
- scams,
- dishonest trading; or
- activity causing significant harm to groups of customers, suppliers or other stakeholders.
It does not investigate every complaint and will consider whether the matter falls within its powers, presents a sufficient public risk and represents an appropriate use of public resources.
An unpaid invoice, shareholder disagreement or ordinary contractual dispute will not necessarily justify a public interest investigation. Those disputes may need to be addressed through debt recovery, commercial litigation or shareholder remedies instead.
Our guide to public interest winding-up petitions explains how these proceedings differ from creditor enforcement and why the court’s public protection role is important.
What happens during a live company investigation?
A live company investigation is a confidential fact-finding process. The Insolvency Service may require the company and relevant individuals to provide documents, information and explanations about the company’s affairs.
- The investigation is conducted under Companies Act powers, including section 447 of the Companies Act 1985. That provision gives the Secretary of State power to require a company to produce documents and information.
- The Insolvency Service states that these investigations are civil fact-finding enquiries, even where the concerns include potentially criminal behaviour. Investigators are not limited to the issue that prompted the original complaint and may examine other matters discovered during the investigation.
- The company and its directors may not be told who made the complaint or the precise reason for the investigation. This can make it difficult to understand the allegation at the beginning of the process.
- Directors should nevertheless avoid assuming that the outcome has already been decided. Relevant company records can be identified and preserved, and responses can be prepared using the available evidence rather than speculation.
Depending on the issues raised, relevant documents may include company accounts, bank statements, customer contracts, marketing materials, board minutes, correspondence with professional advisers and records explaining how customer or investor money was handled.
The information provided should be accurate and consistent with the company’s records. Directors should not attempt to reconstruct documents or fill gaps in their recollection with assumptions.
The investigation may conclude without further action. The Insolvency Service may also issue a warning, refer information to another regulatory body, disclose suspected criminal conduct to law enforcement, begin director disqualification proceedings or present a public interest winding-up petition.
Our guidance on public interest winding-up petition company investigations considers the investigation stage and the importance of understanding what information is being requested.
Can a company defend a public interest winding-up petition?
A company can oppose a public interest winding-up petition. The presentation of the petition does not itself determine that the company must be placed into liquidation.
The Secretary of State must put forward the grounds relied upon, and the court will decide whether it is just and equitable to wind the company up in the public interest.
The appropriate response will depend on the allegations and the available evidence. The company may dispute the factual basis of the petition, challenge the conclusions drawn from the evidence or show that the conduct relied upon does not justify winding up.
In some cases, the company may have changed the way it operates since the investigation began. Changes to governance, customer protections, financial controls, marketing practices or management responsibilities may be relevant. However, stopping the particular activity complained of will not necessarily prevent an order where the court considers that winding up remains appropriate.
The company should review the petition alongside the evidence gathered during the earlier investigation. Statements made and documents supplied at the fact-finding stage may become important when the petition is heard.
Directors must also distinguish between the company’s defence and their own personal position. The company is the respondent to the winding-up petition, but the investigation may contain allegations about decisions made by individual directors.
A response that protects the company in the immediate proceedings may not always address the director’s longer-term risk. Directors should consider whether they need separate advice where their interests could differ from those of the company or another board member.
Our guide to defending a public interest winding-up petition explains how the allegations, evidence and changes made by the company may affect the court proceedings.
Early decisions can influence what happens later. A carefully evidenced response may help clarify the issues, while inaccurate or inconsistent explanations may become relevant in subsequent liquidation or director disqualification investigations.
What does a public interest winding-up order mean for directors?
If the court makes a public interest winding-up order, the company enters compulsory liquidation and can no longer continue trading through its existing management.
The order is made against the company rather than automatically against its directors. It does not, by itself, disqualify a director or establish personal liability.
However, the official receiver will investigate the company’s affairs and the conduct of those involved in its management. Information obtained during the live company investigation may be considered alongside the records and explanations gathered after liquidation.
- Where evidence of unfit conduct is identified, the Insolvency Service may consider director disqualification proceedings. Suspected criminal behaviour may also be disclosed to a law enforcement body, while matters within another regulator’s remit may be referred to that regulator. These are separate possible outcomes and do not arise automatically in every case.
- Directors may also face claims from the liquidator. Depending on the circumstances, these could concern the use of company money, transactions with connected parties, breaches of duty or other conduct said to have caused loss to the company.
Directors should preserve relevant records and cooperate with lawful requests from the official receiver or liquidator. They should also consider whether explanations provided before the winding-up order remain accurate when compared with the company’s books and records.
Our director disqualification guidance explains how conduct investigated after insolvency may develop into a disqualification claim.
A public interest winding-up order can therefore mark the end of the company’s trading activity but the beginning of a separate period of scrutiny for its directors. That does not mean that disqualification, personal liability or criminal proceedings will necessarily follow. Each requires its own evidence and legal basis.
Directors who become involved early can better understand what is being alleged, preserve the documents needed to explain their decisions and consider both the company’s immediate defence and their own longer-term position.
Francis Wilks & Jones advises companies and directors in England and Wales on live company investigations, public interest winding-up petitions and related director disqualification risks. We can review the investigation correspondence, assess the petition and help directors understand the possible consequences before and after a winding-up hearing.
Call today for a private initial consultation.
