What does it mean to liquidate?

The meaning of enterprise liquidation refers to the economic activities of collecting creditor's rights, paying off debts and distributing residual property after the enterprise is dissolved in accordance with the provisions of the articles of association and the termination of operation due to bankruptcy or other reasons. Reasons for liquidation of the enterprise:

1. Liquidation at the expiration of the contract.

2. The law provides for liquidation.

3. Unable to operate and liquidate.

4. Liquidation of illegal operations.

5. Liquidation of property rights changes.

6. Bankruptcy dissolution and liquidation.

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It refers to the legal act of liquidating, disposing of and distributing the company's property, creditor's rights and debts in accordance with legal procedures in order to terminate the existing property and other legal relationships when the company is dissolved, so as to settle its creditor's rights and debts relationship, thereby depriving the company of its legal personality.

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Legal analysis: In the process of dissolving the company, the company settles the company's debts, distributes the company's remaining assets among the shareholders, and finally terminates all the company's legal relations. The Company Law of the People's Republic of China stipulates that if a company dissolves itself, it shall form a liquidation group composed of shareholders or persons determined by the general meeting of shareholders.

When the liquidation group finds that the company's assets are insufficient to pay off its debts, it shall apply to the court for a declaration of bankruptcy.

Legal basis: Company Law of the People's Republic of China Article 185 The liquidation group shall notify the creditors within 10 days from the date of establishment and make an announcement in the newspaper within 60 days. The creditor shall, within 30 days from the date of receipt of the notice, and within 45 days from the date of the announcement if it has not received the notice, declare its creditor's rights to the liquidation group.

When a creditor declares a creditor's right, it shall explain the relevant matters of the creditor's right and provide supporting materials. The liquidation group shall register the creditor's rights.

During the declaration of creditor's rights, the liquidation group shall not pay off the creditors.

The meaning of corporate liquidation refers to the legal act of liquidating, disposing of and distributing the company's property, creditor's rights and debts in accordance with legal procedures in order to terminate the existing property and other legal relations when the company is dissolved. After the liquidation of the company is completed, it shall prepare a liquidation report and go through the cancellation of registration with the company registration authority.

[Legal basis].Article 186 of the Company Law of the People's Republic of China.

After liquidating the company's property and preparing the balance sheet and property list, the liquidation group shall formulate a liquidation plan and report it to the shareholders' meeting, the general meeting of shareholders or the people's court for confirmation. The company's property is distributed according to the proportion of shareholders' capital contributions, and the shares are distributed according to the proportion of shares held by shareholders.

During the liquidation period, the company exists, but it does not have to carry out business activities unrelated to the liquidation. The company's property shall not be distributed to shareholders until it is repaid in accordance with the provisions of the preceding paragraph.