Company Strike off Services in China
The dissolution of a company means the cancellation of the legal personality acquired by the enterprise, which refers to an established company that has to stop its external business activities due to the occurrence of specific events. According to China Company Law, a company must form a liquidation team within 15 days of its dissolution. China adopts the system of “dissolution before liquidation”, in which the dissolution leads to the liquidation procedure, and the legal personality of the company is dissolved only after the liquidation is completed.
When Does A China Company Need To File For Dissolution?
It depends on whether the dissolution of the company was voluntary or not. There are two categories of dissolution: either an arbitrary cause of dissolution or a mandatory cause of dissolution.
- The expiration of the term of business or the occurrence of other causes of dissolution specified in the articles of association.
- Dissolution by a vote of the shareholders at a general meeting or by the sole shareholder in a single-member Limited Liability Company.
- Dissolution due to the need for a merger or division of the company.
- Revoked business license and order of closure in accordance with the law.
- The declaration of bankruptcy of the company is in accordance with the law.
- The People’s Court requires the closure of the business. (Note: When the company has serious difficulties in operation and management, and the continued existence of the company will cause serious losses to the interests of shareholders and cannot be resolved through other means, shareholders holding more than 10% of the voting rights of the company have the right to request the People’s Court to dissolve the company.)
Documents to Be Submitted For Dissolution of a China Company
- A company applying for registration of dissolution shall submit the following documents.
- A signed application for registration of dissolution by the person in charge of the company’s liquidating organization.
- An adjudication of bankruptcy made by the court, a resolution made by the company in accordance with the Company Law, or a document ordering closure by an administrative authority
- A liquidation report that is confirmed by the shareholders’ meeting or the company’s approving authority.
- The Business License for Enterprise Legal Persons
- Other documents that stipulated by laws and administrative regulations.
Dissolution and Liquidation Procedures of China Companies
- A liquidation group must be set up so that the company can start the real process of liquidation within 15 days of the event that caused it to end.
- After the liquidation group is established, the company’s creditors are directly notified and told to register for the claim within the legal period. After liquidation, the balance sheet and a detailed inventory are prepared. During the process of getting ready, if the company’s assets aren’t enough to pay off its debts, it must immediately file for bankruptcy with the People’s Court.
- After liquidation, the liquidation team produces a liquidation report, a statement of income and expenses, and various financial books during the liquidation period. The liquidation report is valid after the shareholders’ meeting, the general shareholders’ meeting and the people’s court all agreed with it.
- Send the report to the company registration authority, apply for cancellation of the company registration, and make a public announcement.
3E Accounting Company Dissolution Services
Dissolution of a China company must comply with the Company Law and the Regulations of the People’s Republic of China on Company Registration. Violations will result in blacklisting, fines, or a ban on doing business in China for at least 3 years.
3E Accounting China company dissolution services include:
- Establishment of a liquidation team
- Filing with the company registration authority
- Preparation of shareholders’ meeting minutes
- Tax clearance
- Preparation of legal documents for application for cancellation of company registration
If you are interested in dissolving your company in China, please feel free to contact us. Our experienced team can assist you in completing all necessary procedures in compliance with laws, rules, and regulations.
