Closing your China business, the proper way
Understanding, planning and implementing your China company liquidation
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Benefit from our 20+ years of experience assisting 1,000+ foreign investors
Pre-liquidation Planning
Helping you decide which method is best to close your business
Administrative procedures
We prepare and supervise all procedures leading to the termination of your licenses
Assets disposals and employment termination
Advising you on how legally handle the termination of your business
Tax clearance
We handle your company’s accounting and tax clearance before closure of bank accounts
Closing your China business, step-by-step
Appointment of Liquidator
Stopping the business, Assets disposal and employee termination
Newspaper announcement
Tax clearance and other administrative formalities
Cancellation of Business License, closing of bank accounts
FAQs
Yes, liquidation is typically the process of winding up a company's affairs, selling off its assets, paying off creditors, and distributing any remaining assets to shareholders, ultimately leading to the company's dissolution.
- Board Resolution: Pass a resolution to liquidate the company.
- Notify Creditors: Inform all creditors about the liquidation process.
- Appoint Liquidators: Appoint liquidators to oversee the process.
- Public Announcement: Announce the liquidation publicly in a designated newspaper.
- Asset Valuation and Sale: Liquidators assess and sell company assets.
- Settle Debts: Pay off all company debts and obligations.
- Distribute Remaining Assets: Distribute any remaining assets to shareholders.
- Deregister the Company: Apply for deregistration with the Administration for Market Regulation (AMR).
Yes, you can cancel the liquidation of a company if the process has not yet been completed and all relevant parties (e.g., creditors, shareholders) agree to the cancellation. You would need to reverse the steps taken in the liquidation process and notify the relevant authorities.
After liquidation, the business ceases to exist. All its assets are sold, debts are paid, any remaining funds are distributed to shareholders, and the company is officially dissolved and removed from the business register.
The final step of liquidation is the deregistration of the company with the relevant authorities (e.g., the Administration for Market Regulation in China), effectively marking the end of the company's legal existence.
As a creditor or shareholder, you may receive some money back if a company goes into liquidation, but it depends on the company's remaining assets and liabilities. Creditors are typically paid first, followed by shareholders, if any assets remain.
The main consequence of liquidation is the cessation of the company's operations and legal existence. Additionally:
- Employees lose their jobs.
- Creditors may receive partial payment for debts owed.
- Shareholders may receive residual assets if any remain.
- Contracts and leases are terminated.
- The company's reputation and future business prospects are negatively impacted.
- Complete Liquidation: Ensure the liquidation process is complete.
- Tax Clearance: Obtain a tax clearance certificate from the tax authorities.
- Public Announcement: Announce the deregistration publicly.
- Submit Application: Submit a deregistration application to the Administration for Market Regulation (AMR) along with necessary documents (e.g., liquidation report, tax clearance certificate).
- Approval: Wait for approval from the AMR.
- Deregistration Certificate: Receive the official deregistration certificate.
- Liquidation: The process of winding up a company's affairs, selling assets, paying debts, and distributing any remaining assets to shareholders.
- Dissolution: The formal closing of a company’s legal existence. Dissolution is the final step that follows liquidation, officially removing the company from the business register.
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