China company deregistration requirements must be strictly followed. Otherwise, the legal representative and the directors may face severe punishment. Company may be deregistered when shareholders decide to terminate the company, due to difficult business operation or financial crisis which cannot be dissolved. In China, the procedure for company deregistration is rather complicated, particularly in face of mainland customs and tax departments.
Steps to Closing a Company in China
1. Clear the tax and submit Tax Clearance Declaration Report;
2. The tax bureau will issue a "notice of cancellation of tax registration";
3. Submit to Foreign Trade & Economic Cooperation Bureau;
5. Cancellation of Letter of approval and Certificate of approval;
6. Announcement on appointed local newspaper & Cancellation of Company Business Licenses;
7. Dissolution of Organizational Code Certificate;
8. Dissolution registration of Statistics Registration Certificate;
9. Cancellation of Alien Employment Permit;
10. Dissolution registration with customs (applicable to trading, manufacturing WFOE only);
11. Bank accounts closure and capital repatriation;
12. Cancellation of Company stamps.
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When a license is revoked, the following is required:
1. The company must immediately cease doing business. This means, for example, that all websites and other public announcements where the company offers to do business in China must be taken down.
2. The official company seals must be collected and deposited with the licensing authority.
3. All taxes and fees owed to the national and local governments must be paid.
4. All salary owed to employees must be paid.
5. The legal representative (you) and the directors of the company must immediately liquidate the company in accordance with the China Company Law and local procedure. All company assets must be used to pay creditors in accordance with the liquidation procedure. Use of the company assets for any other purpose is a crime.
Consequence for not follow the legal process
As the legal representative and the other directors are personally liable for any damages caused to creditors for failing to strictly comply with the above requirements.
When a proper liquidation is not completed, the names of the legal representative and the company directors are placed on a black list. Failure to pay taxes, failure to pay employees and failure to pay a major creditor are normally noted on the black list. The black list is shared with the PRC border control authority and those on the list are usually denied entry into China. This is particularly common in Shenzhen for persons entering the PRC from Hong Kong.
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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