- Management or investors would like to obtain professional advice on the relevant procedures, key issues and preparation prior to their decision on whether to terminate the company.
- Close-down of operations due to a change in the company's strategy.
- Joint venture partners cannot agree on how the business should be run and both partners would like to wind-up the joint venture.
- Voluntary liquidation of a joint venture upon expiry of the cooperation period.
- The useful lifetime of the entity has come to an end. For instance, it is no longer needed post-merger or acquisition.
- Shareholders have been unable to recover their original investment from a loss-making enterprise and do not intend to continue their investment.
- The company is insolvent, leading shareholders to trigger a winding up to avoid bankruptcy.
- The company has been unable to obtain required licenses or operating qualifications since China incorporation.
- Review company information and documents and assess its financial position, in order to comment on issues which need to be completed or settled before liquidation.
- Advise on the employee severance plan, asset protection and asset disposal plans and strategy, debt recovery plans, taxation, foreign exchange, close-down liquidation costs and other regulatory requirements.
- Analyse the potential compensation payable and timing for early termination of contracts.
Liquidation or deregistration
- By advising the liquidation committee or acting as a member of the liquidation committee, we can assist with the following voluntary liquidation work:
- drafting the necessary documents for liquidation applications to be submitted to China Government authorities (including but not limited to tax bureaus, customs, State Administration of Foreign Exchange, Administration of Industry and Commerce (AIC) and Ministry of Commerce (MOFCOM)
- assisting on employee severance work during the wind-up
- realising fixed and movable assets of the company, including valuation, auction or seeking potential buyers, and attending to the negotiation and transaction of assets
- commencing litigation against delinquent debtors, to maximise the recovery
- preparing liquidation reports
- arranging the liquidation audit, including the selection of auditors
- providing advice on communication with regulators, creditors, shareholders/partners and debtors, to maximise asset protection
- distributing/repatriating the remaining funds to shareholders.
An electronic product manufacturing WOFE in Suzhou, China
- Attended to the voluntary liquidation of the company, disposed of assets worth around US$27 million, dismissed and transferred over 600 employees.
- Advised the liquidation committee throughout the liquidation process.
A marine equipment manufacturing WOFE in Shanghai, China
- Attended to the voluntary liquidation of the company, including dismissal of 30 employees.
- Dealt with the arbitration and lawsuits initiated by certain employees on behalf of the company.
- Advised the liquidation committee throughout the close-down process.
An agricultural machinery manufacturing JV in Shanghai, China
- Attended to the voluntary liquidation of the company, including valuation of the remaining assets.
- Advised the liquidation committee throughout the wind-up process.
- Assisted the liquidation committee on reviewing the capital injection from both shareholders, calculating the liquidation costs to be borne by each of the shareholders according to the relevant board resolutions and reviewing the company’s budget in respect of future close-down costs.
A JV involved in aviation services in Beijing, China
- Conducted pre-liquidation compliance review and then attended to the voluntary liquidation of the company.
- Repatriated shareholders’ remaining property of approximately RMB18 million.
- Advised the liquidation committee throughout the liquidation and recovery process.
An electronics product manufacturer
- Attended to the voluntary liquidation of the company.
- Disposed of its PRC JV and Hong Kong listed company.
- Realised US$100 million.