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erexchen
Reacher
Joined: Aug 14, 2006
Posts: 218
Location: Shanghai
Status: Offline
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 Posted:
July 30, 2008 - 06:45 PM |
 
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Company Dissolution and Liquidation in China
Under which condition the company shall be dissolved?
According to China’s new company law, a company may have to be dissolved when one of the following conditions is met:
a) the business operation term as agreed in the company’s Articles of Association becomes expired or other condition for dissolution as agreed in the Articles of Association for dissolution occurs;
b) resolution of dissolution is made by the meeting of shareholders;
c) the company is merged or separated and the company will not exist any more;
d) the business license is revoked by government, or the company is ordered to be closed or cancelled;
e) there is serious difficulty in company’s operation and management and the shareholder’s interest may suffer great loss if the company continue to operate. Shareholders who holding ten percent or above voting right may file to the court for dissolution if negotiation among shareholders fails.
What shall happen after the company is dissolved?
Except above c), after the company is dissolved, a liquidation committee shall be formed by the company within 15 days and the company shall go to the liquidation procedure. For limited liability company, the liquidation committee shall consist of the shareholders.
If the company fails to form the liquidation committee, the company’s creditor can apply the court to form such committee and the member of such committee shall be designated by the court.
What is the job for the liquidation committee?
The liquidation committee shall be responsible for:-
a) having a liquidation of the company property and issuing balance of sheet and property list;
b) informing company’s all creditors;
c) dealing with any pending transaction/business with the company;
d) settling all outstanding tax fee;
e) dealing with any remaining company property;
f) handling company litigation on behalf of the company.
Within 10 days after the liquidation committee is formed, the committee shall inform company’s creditors and further shall make public announce on the newspaper within 60 days. The creditors shall report their claims to the committee within 30 days upon receipt of the notification or within 45 after the newspaper announcement.
How to deal with the company property?
The committee shall be responsible for liquidation of the company property and make the liquidation plan and report to the meeting of shareholders or the court (if the committee is designated by the court) for confirmation.
The company property shall be distributed as follows:-
a) to pay liquidation expense;
b) to pay employee’s salary, social security fee and severance fee;
c) to pay outstanding tax;
d) to pay company debt;
e) to distribute among shareholders if there is any property left.
After that, the company shall apply for deregistration in the government.
What if the company property is not enough to offset the company debt?
In case the company’s property, after liquidation, is not enough to offset all company debt (including above a) – d)), the company liquidation shall be terminated. The company or the creditor can file bankruptcy to the court. |
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lilirj
Squeeker
Joined: Feb 07, 2008
Posts: 18
Status: Offline
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Aug 04, 2008 - 01:20 AM |
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| erexchen wrote: |
Hi TISM
Restraint of trade?? Do you mean the non-competition clasue or agreement in the employment? If it is, according to Chinese law, the maximum period is two years after termination of employment and can be applied nationwide. However, the company shall pay compenstation to the employee every month after termination of employment. Otherwise such clause/agreement will not be binding.
Erex Chen
erexcxl@yahoo.com.cn |
Hello!
Can you elaborate on this? Is there a specified amount/ percentage of compensation? Is this for the whole 2-year clause? What if I get a job in a different tade/ industry in Shanghai or go outside China to work, do I still get compensation? I have this in my contract and I want to know what my options are.
Thank you so much for starting this thread. This is very helpful |
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erexchen
Reacher
Joined: Aug 14, 2006
Posts: 218
Location: Shanghai
Status: Offline
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Aug 05, 2008 - 12:39 PM |
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Non-competition and confidential agreement is widely used by companies especially those in high-tech industry. This is to protect the company's trade secret and keep the company competitive in the market. Employee flow will bring potential risk for company because some employee would possibly disclose confidential information to others. We have cases in which the company suffers great loss becasue of this.
However, if the employee is not allowed to get a job in other company who may have competition with the company, the employee's interest can also be harmed. That's why the law requires the company shall pay compensation to the employee if the employee is required to sign the non-competition agreement.
The compensation shall be paid to the employee starting from the termination of the employment contract and shall be paid on a monthly basis. The amount of such compensation shall be discussed and agreed by both the company and the employee before signing the agreement. The law does not set fixed amount/percentage in this regard. So it can be 50% or other amount agreed by both parties.
If the company fails to pay compensation monthly, then the employee is not liable to comply with the agreement and the agreement shall be deemed to be terminated automatically.
You can be entitled to the compensation if you get a job in a company who has no competition with your old company.
Erex Chen
erexcxl@yahoo.com.cn |
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diosza2000
Seeker
Joined: Jan 13, 2008
Posts: 44
Status: Offline
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Aug 06, 2008 - 09:00 PM |
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Hello.... I'm looking for a simple answer for a simple question...
I am an expat which undergone with all the physical and health examination for me to acquire my residence / work visa.
If I am working for the restaurant industry.... is the physical and mental examination can be a substitute to a health / hygiene certification that is being required to all food-related workers before they start work?
Is there any website where I can verify this?
Thanks for your kind responses. |
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erexchen
Reacher
Joined: Aug 14, 2006
Posts: 218
Location: Shanghai
Status: Offline
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Aug 07, 2008 - 04:53 PM |
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I think this is not a legal issue. Whether you shall be required to have another health certification shall be decided if the items in the phisical and health examination for work permit can cover those in the health certificate, and if the restaurant authority requires another separate certificate for work in restaurant industry. |
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Shanghai7136
Reacher
Joined: Nov 26, 2003
Posts: 238
Status: Offline
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Aug 14, 2008 - 03:23 PM |
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Recently, the upstairs tenant's water pipes broke and flooded his own apartment. As he was out of the country, it flooded for a whole day and leaked into my apartment. It got so bad that the water outside in the hallway of his floor was more than 3 inches deep. It leaked down the stairwell to my floor, and water also leaked directly into my apartment, causing me to lose all electricity. It dripped from numerous places from the ceiling and lights, and my clothes, bed, wardrobe, floors, everything was wet. I had to move into a hotel.
I contacted the landlord who says it's not her legal responsibility as he is the tenant. The tenant won't pay because he says it's her apartment. It's been more than a week and my apartment is still in shambles, and I'm paying for the hotel out of pocket. I'm miserable.
Who is responsible?
Also, the tenant is a foreigner, and the owner is as well. Both are mostly out of the country. The landlady is a relative of the owner and refuses to incur any costs.
What will happen if I decide to sue? As they are all foreigners, which court would I be going to? How long is this process? What happens to a foreigner when they are being sued in China? What about the foreigner suing another foreigner? Does anyone get blacklisted in China if they are sued, and loses the case?
What about pain and suffering, would I be able to get punitive damages awarded?
Thank you! |
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underh20
Shanghai Royalty
Joined: Sep 27, 2006
Posts: 9883
Location: EOA Seminar
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Aug 14, 2008 - 06:45 PM |
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Sue them both.
When in a civil court process, the respondant is barred from leaving China.  |
_________________
بارك الله ، بارك الله |
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Shanghai7136
Reacher
Joined: Nov 26, 2003
Posts: 238
Status: Offline
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Aug 14, 2008 - 06:50 PM |
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AWESOME!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
But can I leave? lol. |
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underh20
Shanghai Royalty
Joined: Sep 27, 2006
Posts: 9883
Location: EOA Seminar
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Aug 14, 2008 - 06:53 PM |
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Yeah, only the respondant (defendant) can't leave. Tell the court to order them barred from leaving China. |
_________________
بارك الله ، بارك الله |
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Shanghai7136
Reacher
Joined: Nov 26, 2003
Posts: 238
Status: Offline
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Aug 14, 2008 - 09:29 PM |
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Yay!! Thank you.
Any way to answer my other questions? |
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underh20
Shanghai Royalty
Joined: Sep 27, 2006
Posts: 9883
Location: EOA Seminar
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Aug 14, 2008 - 10:10 PM |
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| Shanghai7136 wrote: |
1. Who is responsible?
2. As they are all foreigners, which court would I be going to? How long is this process?
3. What happens to a foreigner when they are being sued in China? What about the foreigner suing another foreigner?
4. Does anyone get blacklisted in China if they are sued, and loses the case?
5. What about pain and suffering, would I be able to get punitive damages awarded? |
1. I would think both are depending on what caused the water damage. I mean, if the pipes broke then that is also the landlord's issue, but if the tenant simply forgot to turn off the water then I'd think the landlord is not liable.
2. You'd go to the local Chinese civil courts. The process will probably not be fast or efficient. It might, though, be fair.
3. Nothing extraordinary happens.
4. No blacklist. They can be barred from ever leaving China until they pay any judgment against them, though.
5. I don't think so. |
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erexchen
Reacher
Joined: Aug 14, 2006
Posts: 218
Location: Shanghai
Status: Offline
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Aug 15, 2008 - 03:01 PM |
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In most cases, the landlord shall be responsible for the damages except it is the tenant who has fault in causing the water damage. I believe you can sue both of them in the court where the apartment is located. But you shall collect their personal informaiton such as name, address for the lawsuit.
Usually the court may need several months to render the award, or the court will mediate the case. In later case the dispute can be settle quickly.
In addition, you shall provide evidence showing your loss.
Erex Chen
erexcxl@yahoo.com.cn |
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Shanghai7136
Reacher
Joined: Nov 26, 2003
Posts: 238
Status: Offline
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Aug 15, 2008 - 04:47 PM |
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erexchen
Reacher
Joined: Aug 14, 2006
Posts: 218
Location: Shanghai
Status: Offline
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Aug 15, 2008 - 09:13 PM |
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How to License a Trade Mark in China
A trademark is a name, figure, or design created by a company/individual to distinguish its product or service. In China, a registered trade mark can be licensed to another firm in return for a royalty. Due care must be taken while licensing the trade mark so that mistake can be avoided. In China, the following basic requirements must be met for trade mark license:
A. The trade mark to be licensed must be a registered trade mark in China. Without the registration, the trademark is just design or symbol and such license has no legal effect.
B. The scope of product or service in the license must fall into that as showed in the trade mark certificate;
C. The licensee must mark its own name and production place on the product while using the trade mark;
D. In the license agreement, at least the following clause must be contained:
a) Information about the licensor and the licensee;
b) the licensed trademark, its registration number, validity term;
c) the scope of product or service in the license;
d) license term;
e) who provides the trade mark logo;
f) clause showing the licensor has the right to supervise the quality of product by the licensee;
g) clause showing the license shall mark its name and production place on the product while using the trade mark.
E. Within three months upon signing, the trade mark license agreement shall be filed for record in the China Trademark office. |
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Shanghai7136
Reacher
Joined: Nov 26, 2003
Posts: 238
Status: Offline
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Aug 25, 2008 - 07:56 AM |
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| erexchen wrote: |
In most cases, the landlord shall be responsible for the damages except it is the tenant who has fault in causing the water damage. I believe you can sue both of them in the court where the apartment is located. But you shall collect their personal informaiton such as name, address for the lawsuit.
Usually the court may need several months to render the award, or the court will mediate the case. In later case the dispute can be settle quickly.
In addition, you shall provide evidence showing your loss.
Erex Chen
erexcxl@yahoo.com.cn |
Hi, just one last question -- filling out the papers for lawsuit now -- just wanted to doubly make sure that I will not be stuck in Shanghai for 6 months if I proceed with this, as I'll need to travel quite a bit in the next 3 months. If the people I'm suing is stuck in China and can't leave until it's over -- I don't care! |
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erexchen
Reacher
Joined: Aug 14, 2006
Posts: 218
Location: Shanghai
Status: Offline
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Aug 25, 2008 - 10:52 AM |
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You must be present in the court when the hearing is held. Or you can find a lawyer to represent you.
I think you can receive the court summons within several weeks. |
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MoonOverMiami
Raver
Joined: Jan 07, 2008
Posts: 460
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Aug 27, 2008 - 04:41 PM |
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Is there a provision in the law that would protect the employer from frivilous claims made by the same employee(s)? For example, the employee makes a claim with the labour bureau only to find out the claim is without substance. Then the same employee files another claim only to find out they have no recourse. Each time the employee has not met with the management to discuss the issue. Is there a mechanism in the system to protect the employer from continued (for a lack of better term) harassment? |
_________________
"One who falls asleep with an itchy backside, will wake up with smelly fingers..." |
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underh20
Shanghai Royalty
Joined: Sep 27, 2006
Posts: 9883
Location: EOA Seminar
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Aug 27, 2008 - 04:44 PM |
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Yes. Fire the dickheads. |
_________________
بارك الله ، بارك الله |
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leidelaohu
Wonder Wit
Joined: June 11, 2007
Posts: 3777
Status: Offline
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Aug 28, 2008 - 01:44 AM |
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| underh20 wrote: |
| When in a civil court process, the respondant is barred from leaving China. |
So we do a little time travel back to one month ago. Joe Schmo has a crappy L or F visa, can't get it renewed. Joe has his buddy downstairs sue him for water damages. Joe now cannot leave the country.
What kind of visa does Joe get ? And where ? |
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underh20
Shanghai Royalty
Joined: Sep 27, 2006
Posts: 9883
Location: EOA Seminar
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Aug 28, 2008 - 09:56 AM |
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Not sure. I just know that the plaintiff can request the defendant be barred from leaving the country.
Perhaps you take a copy of the court order or other documentation to the PSB. |
_________________
بارك الله ، بارك الله |
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erexchen
Reacher
Joined: Aug 14, 2006
Posts: 218
Location: Shanghai
Status: Offline
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| Posted:
Aug 28, 2008 - 10:13 AM |
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| MoonOverMiami wrote: |
| Is there a provision in the law that would protect the employer from frivilous claims made by the same employee(s)? For example, the employee makes a claim with the labour bureau only to find out the claim is without substance. Then the same employee files another claim only to find out they have no recourse. Each time the employee has not met with the management to discuss the issue. Is there a mechanism in the system to protect the employer from continued (for a lack of better term) harassment? |
I don't know if your company has a complete staff handbook which may include the company rules. If the employee cannot concentrate on his work and does not cooperate with the company on the job responsibility he shall take, you can fire the employee according to the staff handbook. |
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underh20
Shanghai Royalty
Joined: Sep 27, 2006
Posts: 9883
Location: EOA Seminar
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Aug 28, 2008 - 10:25 AM |
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^ Yes, it is extremely important to have a guide for employees. Make sure that guide is referenced in the actual employment contract. |
_________________
بارك الله ، بارك الله |
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MoonOverMiami
Raver
Joined: Jan 07, 2008
Posts: 460
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Sep 01, 2008 - 08:21 PM |
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Like to give a special "THANKS!!!" to underh20 and erexchen for their advice and counsel. underh20's interpretation of the law has been spot on and advice has been quite helpful to formulate our own guidelines.
erexchen for the time he took to look up the law in question and confering it to me via PM and email. Also took the time to look up some past history data on social insurance in China, and provided some counsel on our company's current issues.
Both your help are greatly appreciated, now I have a better understanding of how things work in China. Still have a lot of grey areas, but things are a bit clearer now. Thanks again for both your time, and help!!! |
_________________
"One who falls asleep with an itchy backside, will wake up with smelly fingers..." |
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Jeiceee8
Newbie
Joined: Aug 21, 2008
Posts: 4
Status: Offline
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Sep 05, 2008 - 12:55 AM |
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Hi! I have a question and I hope you can give me an advice..
I've been working here in Shanghai for 2 years and I am holding a working visa, I applied for my visa renewal last Aug 9. together with the complete documents from our company. However, when the officer gave me the receipt I noticed that they erased the pick up date and they put something in chinese character (that means, wait for the call), I don't know if there is something wrong with my application because its already Sept. 4 and I still haven't receive any call from them on when I can get my passport and visa. I tried to follow up about the status of my visa but then they can only inform me that it is still processing.
Is there anyone here who experienced the same situation like me? I am a little bit upset with my status because my last visa expired last August 17. Please give me some advice on what should I do.
Thank you in advance.. |
_________________
They laugh because I'm different, I laugh because they're all the same... |
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ckfactor
Talker
Joined: Feb 12, 2008
Posts: 90
Status: Offline
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Sep 05, 2008 - 09:45 AM |
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Can a foreigner take life insurance out on a local. Can it be a foreign life insurance provider in China? Local provider? |
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