In China, the closure of a company requires a quite complex procedure both in terms of time and costs to such an extent that nowadays it represents one of the major impediments for some foreign investors who start an investment in the country.<\/p>\n
For this reason, since 2017, the Chinese government has been carrying out a number of regulatory measures with the scope of simplifying the procedure, showing this intention firstly in the \u201cNotice on Facilitation of Business Cancellation\u201d <\/em>(\u5e02\u573a\u76d1\u7ba1\u603b\u5c40<\/em> \u4eba\u529b\u8d44\u6e90\u793e\u4f1a\u4fdd\u969c\u90e8\u5546\u52a1\u90e8<\/em> \u6d77\u5173\u603b\u7f72<\/em> \u7a0e\u52a1\u603b\u5c40\u5173\u4e8e\u63a8\u8fdb\u4f01\u4e1a\u6ce8\u9500\u4fbf\u5229\u5316\u5de5\u4f5c\u7684\u901a\u77e5<\/em>) of 2019, and, more recently, in the \u201cCircular on Further Improving Simplified Deregistration to Facilitate the Withdrawal of Micro, Small and Medium-Sized Enterprises from the Market\u201d \u2013 <\/em>SAMR Circular 45\/2021<\/em>\u5e02\u573a\u76d1\u7ba1\u603b\u5c40\u56fd\u5bb6\u7a0e\u52a1\u603b\u5c40\u5173\u4e8e\u8fdb\u4e00\u6b65\u5b8c\u5584\u7b80\u6613\u6ce8\u9500\u767b\u8bb0\u4fbf\u6377\u4e2d\u5c0f\u5fae\u4f01\u4e1a\u5e02\u573a\u9000\u51fa\u7684\u901a\u77e5<\/em> \u2013 <\/em>published on August 3rd<\/sup> by the State Administration for Market Regulation (SAMR) with the aim of optimizing the business environment and stimulating market vitality.<\/p>\n The intervention of the legislator provides for a simplified procedure applicable to a number of specific cases that allows the reduction of both the formalities required to the company and the subjects involved in the liquidation process, with a consequent savings in time and costs.<\/p>\n Pursuant to Art. 1 of the Circular, the simplified procedure applies to \u201call commercial operators who have not pending rights and debts towards their creditors\u201d <\/em>(including employees\u2019 wages, statutory compensation, social insurance, taxes, etc.), broadening the scope of application compared to what provided for previously and removing the application limits in relation to the legal form of the company except for the companies limited by shares listed within the negative list for foreign investments.<\/p>\n Further cases in which the simplified procedure is not applicable involve:<\/p>\n However, the Circular provides for the so called \u201cfault-tolerant mechanism\u201d that regulates those cases in which the competent authorities have detected the above mentioned anomalies subsequently the submission of the announcement. In these cases, it is not necessary to revoke the announcement, rather it will be sufficient to re-submit it as soon as the anomalies have disappeared.<\/p>\n The de-registration of the company from the Registry of Companies shall be made through a digital platform (\u4e00\u7f51<\/em>\uff0cliterally \u201cone network\u201d). Once entered the dedicated section on the platform, the applicant shall proceed with the \u201cde-registration announcement\u201d that will be published through the National Enterprise Credit Information Publicity System. The announcement will be subject to a period of 20 days (instead of 45 days provided for the general de-registration procedure in case of announcement on the newspaper) during which the SAMR will share all necessary information directly with other authorities involved in the liquidation procedure (taxes, HR, social insurance) that are required to raise objections within the time allowed.<\/p>\n With regard to tax aspects, it should be noted that this procedure can be applied only if:<\/p>\n <\/p>\n In case of any objection is raised by the involved authorities or by the SAMR, the applicant can proceed with the electronic submission of the following documents in order to complete the de-registration procedure:<\/p>\n <\/p>\n From this general analysis, it is clear that, compared to the general de-registration procedure, the simplified one provides for a process \u2013 except for the tax requirements \u2013 quite facilitated but, applicable to those companies that actually are in situations of inactivity.<\/p>\n The Commitment Letter, signed by all investors, which declares the existence of the conditions necessary to have access to the simplified procedure, substitutes the liquidation report (drafted by the liquidation committee during the general procedure) by largely relying on the \u201cgood faith\u201d of the applicant, whose eventual false statements could be subject to administrative and criminal penalties.<\/p>\n <\/p>\n China Desk \u2013 Studio Legale Zunarelli <\/em><\/p>\n","protected":false},"excerpt":{"rendered":" In China, the closure of a company requires a quite complex procedure both in terms of time and costs to such an extent that nowadays it represents one of the major impediments for some foreign investors who start an investment in the country. For this reason, since 2017, the Chinese government has been carrying out […]<\/p>\n","protected":false},"author":1,"featured_media":43187,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[203],"tags":[],"class_list":["post-43186","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-insights"],"acf":[],"yoast_head":"\n\n
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