Research On Dissolution And Liquidation Regulations Of Foreign Invested Companies In China

Foreign-invested company is one of the most important forms for foreign investors to make direct investment into China.Its incorporation, operation and termination shall be subject to the legal regulations in China. In the past,all legal regulations relating to foreign-invested company in China,including the Company Law and other special regulations concerning foreign-invested company,mainly focused its attention on the incorporation and operation of the enterprises,and paid less attention on its dissolution and liquidation,i.e.,the exit system of foreign-invested company.The simple legal regulations in this respect have resulted in the fact that a large number of foreign-invested companies,mainly small and medium-sized companies have failed to go through dissolution and liquidation procedures after its termination,seriously affecting the interests of the country,society,creditors and employees,disordering the economic order and even defacing the image of China in the international society.In recent years,facing the imperfect dissolution and liquidation regulations,China has modified the Company Law as promulgated in 1994 and published relevant judicial explanations,in order to regulate and streamline the dissolution and liquidation systems of all enterprises, including that of foreign-invested companies.However,due to the specialty of foreign-invested companies,the current legal regulations relating to dissolution and liquidation of foreign-invested company are still far from perfect and can not meet the demand for the guiding and regulating the dissolution and liquidation of foreign-invested companies.In this paper,the author,by utilizing the legal explanation, comparative analysis and empirical research methods,will make a systematic analysis and study of the legal regulations relating to the dissolution and liquidation of foreign-invested companies in China,and then point out the existing problems and forward corresponding modification suggestions.This paper is divided into three chapters.In the first chapter,the author introduces the general theory concerning the dissolution and liquidation of foreign-invested companies. Attention is focused on the description of the character of foreign-invested companies,the basic knowledge of dissolution and liquidation of foreign-invested companies,and the significance for dissolution and liquidation of foreign-invested companies.In the second chapter,the author analyzes the current legal regulation in China concerning the dissolution and liquidation of foreign-invested companies,mainly describes the development of the dissolution and liquidation system and its main contents.Based on the description of the above-mentioned,the author analyzes and points out the shortcomings existing in the current legal regulations relating to the dissolution and liquidation of foreign-invested companies,including the incongruous regulation,lack of procedures for creditors to initiate the legal lawsuit to dissolve foreign-invested company;lack of systems to claim against the board members;entangling duties of liquidation obligator and liquidator itself;lack of specific regulation with respect to remuneration for liquidation;imperfect punishment measures and lack of regulations for trans-border dissolution and liquidation.In the third chapter,the authors provides suggestions for streamlining the legal regulations for dissolution and liquidation of foreign invested companies,mainly including perfecting law making modes,introducing procedures for creditors to initiate the dissolution of foreign-invested companies;streamlining the responsibility systems for board members; setting up system for professional liquidators;setting up systems for liquidation remuneration;perfecting punishment measures,especially the administrative and criminal punishment measures.Based on the above-mentioned study,it is suggested that it is necessary to streamline the legal regulations for dissolution and liquidation of foreign-invested companies,so as to perfect the management of foreign-invested companies.Due to the fact that there are less studies on the dissolution and liquidation of foreign-invested companies,the author can not refer to the study results of other researches,and he can only utilizes his own work experience and understanding of relevant legal regulations.Hence,please do understand the careless omission and mistakes in this paper.