China Company De-registration

In China, the procedure for company de-registration is rather complicated, particularly in face of mainland customs and tax departments compare to register a new company.

 

Closing Down 1

According to China’s new company law, a company may have to be dissolved when one of the following conditions is met:

1. The business operation term as agreed in the company’s Articles of Association becomes expired or other condition for dissolution as agreed in the Articles of Association for dissolution occurs;

2. Resolution of dissolution is made by the meeting of shareholders;

3. The company is merged or separated and the company will not exist any more;

4. The business license is revoked by government, or the company is ordered to be closed or cancelled;

5. There is serious difficulty in company’s operation and management and the shareholder’s interest may suffer great loss if the company continues to operate. Shareholders who holding ten percent or above voting right may file to the court for dissolution if negotiation among shareholders fails.

 

China Company De-registration Procedure

1) Shareholders decide to liquidate Company

2) Company selects a professional firm to assist with the process of de-registration

3) Preparation of related documentation such as resolution for termination of the Articles Of Association (‘AOA”), application letter, liquidation committee list, resolution of shareholder for company de-registration and the liquidation team and other sort of document required by relevant authorities.

4) Application for liquidation with the Bureau of Commerce (“BOC”) and Administration of Industry & Commerce (“AIC”)

5) Formation of a Liquidation Commitee

6) Public announcement issued in local newspapers

7) Employees should be laid off

8) Valuation and sale of company assets

9) Creditors paid off

10) Final Audit conducted (including all liquidation transactions)

11) Businesses trading, importing / exporting across borders must de-register from China Customs

12) Deregistration from the local governing Tax Authority

13) Destruction of company chops and seals

 

Note: Before file the de-registration application, corporate bank account should be closed and make sure that there is no outstanding accounts receivable.

 

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