Meaning
Multi step legal procedure governs the formal dissolution of a business entity and the distribution of its remaining assets. Following the standard liquidation workflow is mandatory for foreign invested enterprises that do not qualify for expedited administrative paths. The sequence involves forming a committee, notifying creditors, and clearing all tax liabilities with the government.
Committee Formation
Shareholders must establish an internal body to oversee the dissolution and manage corporate property. Under the standard liquidation workflow, the liquidation committee is formed within fifteen days of the shareholder resolution to dissolve. This group takes control of the company seals, bank accounts, and financial ledgers to manage the winding up process.
Debt Settlement
Liquidators must resolve all outstanding financial claims before distributing any residual value to shareholders. The standard liquidation workflow requires notifying creditors directly and publishing a public notice to allow claims to be filed. The committee then pays outstanding salaries, social security contributions, taxes, and secured debts in a legally defined order of priority.
This stage also requires preparing a detailed liquidation report that must be audited and approved by the shareholders or the local court.
Final Cancelation
Terminating the corporate registration requires obtaining approval from several government departments. The standard liquidation workflow concludes when the company submits its tax clearance certificate and liquidation report to the market regulation administration.
