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Closing a Company in China

Updated:2018-4-20 16:31:39    Source:www.tannet-group.comViews:427

Closing a company in China should be compliant with Chinese laws and regulations. Whether it's for financial reasons, or simply because you've had enough of the business, there are myriad issues involved in winding down a business. Closing a company is not that easy as closing a piece of window.

Tannet, with over 18 year of development, will surely offer one-stop services for enterprises and business individuals to help take away the distraction of the tedious procedures by virtue of our professionalism and experience.

Company Liquidation
Liquidation refers to the voluntary termination of the company’s operations and its formal termination. After layoffs of employees, selling remaining assets and settling any debts, the company’s registrations with the various government departments can be canceled, and lastly, the remaining capital will be returned to the investor.

It is important to keep in mind that liquidation does not always occur for negative reasons such as bankruptcy. A company may also seriously consider liquidation for strategic reasons.

Company Dissolution
Dissolution is the last stage of liquidation, the process by which a company (or part of a company) is brought to an end, and the assets and property of the company redistributed. All company dissolution should be comply with the requirements of laws and regulations of PRC’s Company Law and PRC’s Company Registration Administration Ordinance.

Company Deregistration
In China, the procedure for company deregistration is rather complicated, particularly concerning compliance to China Customs and the Tax Authority. In general, the process can take between one year and two years depending on the complexity of your enterprise.

After the deregistration process with the local and state administration, the final distribution of funds and closing of bank accounts can begin. Depending on the number of bank accounts existing in China and any remaining balance, the timing for this stage can vary significantly. Finally the company chops and seals can be destroyed thus completing all procedures for a compliant liquidation and deregistration of a china based WFOE or RO.

Consequences for not Canceling Your Company as Required
1. The legal representative of the company revoked shall not engage in business activities within 3 years in China.
2. The responsible legal representative will be blacklisted and cannot buy air ticket and train ticket in China for the company that has not been revoked as required.
3. The overdue penalty should be paid if the legal representative of the company applies for a license three years later.

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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