In this China business vlog, Nicolas Coster, a French business lawyer, talks about the nuances that businesses face when closing a company in China.
Five Key Takeaways
1. It is required to apply to the tribunal to file a lawsuit to start the procedure for bankruptcy. So, any third party to which the company owes some money is able to go to the court and apply for bankruptcy.
2. It could be a long process, if you go to a 1-tie city it is possible to close the bankruptcy within six months to twelve months. But if you go to smaller cities, it can last for up to 5 years.
3. For a limited company, the risk for the investor depends if they pay or they didn't pay the registered capital.
4. As for the intangible asset, the liquidator will probably sell them and an auction will be organized; so, some party will be able to buy the intangible asset.
5. In most cases, the legal representative will not be responsible and will not have to pay money from his pocket during bankruptcy procedures in China
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