Company gone out of business

Businesses stop operating for a variety of reasons. If you find yourself affected by a business closure, you may be unsure of your consumer rights.

The terms going into administration, examinership, liquidation or receivership are all terms used to describe where a company is at risk of, or is, going out of business. Read more about closing or selling a business.

When a company closes down or has gone out of business, you could lose money if:

• You paid in full for a product that has not been delivered or a service that has not been provided
• You paid a deposit
• You bought a gift voucher or gift card that has not been used yet
• You bought a product that is faulty

If you cannot reach the company or you want to check if they have gone out of business, check their name on the Companies Registrations Office (CRO). Information about companies based in the United Kingdom can be found on Companies House.

You can also:

• Visit the business premises or website - Check to see if a notice has been posted, giving you any more contact information.
• Find out your options for cancelling payment - If you paid by credit card or debit card, contact your bank to see if charges can be reversed due to the goods and services not being received. This is known as chargeback.
• Research to see if the business is licensed or a member of an organisation - In some cases, you may be entitled to compensation. For example, if a licensed travel agency goes out of business and if the paid travel services were not provided, you may be eligible to claim under their insolvency protection.

Whether you get your money back depends on the individual case. When a business closes, common problems are:

• The company has gone into liquidation of receivership
• There is a new owner
• You have an unused gift voucher or credit note
• You have paid a deposit but not received the goods or service
• Your goods are now faulty

Company is gone into liquidation or receivership

If a liquidator or receiver has been appointed, the company is no longer run by its owners. The company usually owes money to several creditors (a person or company the business owes money to). If a business fails before you get a product or service, then you are also a creditor.

Get the details of the liquidator or receiver (the person who is responsible for settling the company’s debts) and make a claim in writing. You should provide the following:

• Details about the product you have paid for
• Exactly how much money you are owed
• What you would like them to do (for example, arrange for delivery of the item or full refund)

However, there is no guarantee your claim will be successful. There are rules for the priority to be given to various debts owed. Generally, you will be treated as an unsecured creditor. Revenue, banks and company employees are secured creditors, so they get their money back before any customers. This means that after the secured creditors get what they are owed there may not be any money left to pay you.

If there is a new owner

If the company has been sold to a new owner, you need to find out if they have taken on the previous owner’s liabilities and are willing to honour claims. The new owner may not:

• Be responsible for completing orders placed with the previous owner for goods and services not delivered
• Have to honour gift vouchers or gift cards issued by the previous owner
• Repair faulty products sold by the previous owner

I have an unused gift voucher or credit note

If the company for which you have a voucher or credit note goes out of business, you do not have formal rights to get a refund. This is because both a gift voucher and a credit note are the previous owner’s responsibility. The voucher becomes a debt the company has not paid and you are an unsecured creditor.

It is still worth asking if the administrator, receiver, liquidator or new owner will honour the voucher but it is unlikely you will get any money back.

I have paid a deposit or my product is on order

If you have paid a deposit on goods or services and the company goes out of business before delivery has been made, you may find it very difficult to get either the item you paid for or a refund.

Contact the administrator, receiver or liquidator to see if you can get your product or money back. The business might not have any money left to pay you.

If you paid the deposit by debit card or credit card, contact your bank or card provider to see if it will reverse the transaction using the chargeback process.

I still owe money on something I bought on credit

If you still owe money on something you bought on credit (for example, through Hire Purchase), you still have to make your payments even if the business closes down. The credit is provided through a finance company that is separate to the retailer.

What about faulty goods or services?

In general, when a good is faulty you have the right to ask the seller for a repair, replacement or refund. However, if the company has gone out of business, this makes it more difficult to resolve.

To get a faulty good fixed, replaced or get a refund, try to:

• Contact the new owner, or administrator, receiver or liquidator to see if they will fix the problem for you
• Check if the product came with a manufacturer guarantee or warranty.

If there is a guarantee or warranty, you should check the terms and conditions to see:

• Whether it is still valid (for example, it has not expired)
• If the fault is covered and what you are entitled to
• How to make a claim

Follow the claim process stated and contact the manufacturer as soon as possible.

If a company has gone bust, and you have not got what you paid for, you can try to get money back by asking for chargeback. This only applies if you paid for the product or service by debit card or credit card. Contact your bank or card provider to see if it will reverse the transaction (known as the chargeback process).

Some other payment methods also have protection schemes (for example, PayPal buyer protection). The CCPC has more information on chargeback.

The Competition and Consumer Protection Commission (CCPC) has a consumer helpline and website that gives consumers information on their rights.

You can use out-of-court procedures such as the European Consumer Centre (ECC) Ireland (for cross-border disputes only) and Online Dispute Resolution (for national and cross-border online disputes).

Find out more about consumer protection organisations.