Cancellation of registration for foreign invested enterprise in China may happen due to various reasons. According to Tannet’s years of experience, if enterprises do not follow legal deregistration process, the legal representative of the company to be revoked shall not engage in business activities within 3 years in China. The responsible legal representative will be blacklisted and cannot buy air ticket and train ticket in China. And the overdue penalty should be paid if the legal representative of the company applies for a license three years later.
Cancellation of Registration for Foreign Invested Enterprise in China
Once the company has decided and declared its decision to dissolve, the liquidation process begins. The liquidation process can be a lengthy process, usually taking up to 12 months, but may differ depending on the reaction time of the company, the authorities and other unforeseeable circumstances.
Upon completion of the liquidation procedures, the liquidation committee shall submit the Liquidation Report, approved by the Board, to the original approval authority. The committee should return its business license and cancel its registration with the relevant government authorities including the Ministry of Commerce, the State Administration of Industry and Commerce, the customs administration, the tax authorities and the State Administration of Foreign Exchange. All of the company’s bank accounts should be closed.
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After submission of the Liquidation Report, the company should perform de-registration with the authorities. After de-registration, the company can repatriate the remaining funds back to the investor. These de-registrations and other processes are:
De-registration from Ministry of Commerce, and cancellation of the Approval Certificate;
Tax audit and de-registration from the local tax bureau;
Tax audit and de-registration from the state tax bureau;
Customs de-registration;
De-registration with the State Administration of Foreign Exchange;
De-registration from the State Administration of Industry and Commerce;
De-registration of the Business Code Certificate;
Public announcement in a newspaper to terminate the business;
Remit funds back to investors;
Close bank accounts.
In addition, some companies in particular sectors may have other specialized registrations and those should be closed off as well. Although not strictly a financial issue, foreign investors should also ensure that, for example, unused raw materials and unsold products are disposed of properly, and in an environmentally sensitive way, and that buildings and other major assets are dealt with properly. Do not shirk, it is your responsibility.
Contact Us
If you have further inquires, please do not hesitate to contact Tannet at anytime, anywhere by simply visiting Tannet’s website english.tannet-group.com, or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to tannet-solution@hotmail.com. You are also welcome to visit our office situated in 16/F, Taiyangdao Bldg 2020, Dongmen Rd South, Luohu, Shenzhen, China.
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