清算程序liquidation procedure in Taiwan

ordinary liqudation

what the process and procedure?

Commencement of Liquidation Proceedings

第326條（清算人檢查財產之處置）清算人就任後the liquidator must inspect and liquidate the assets of the company and draft financial statements and an inventory of property, submit them to the supervisors for examination, obtain the approval of the shareholders?meeting, and file them with the court.

  1. after such reports, financial statements and inventory of property have been ratified by the meeting of shareholders
  1. submit the same to the court.並即報法院

催報債權

  1. urge the creditors to declare their rights of claims +within a period of 3 months +by means of public noticeat at least 3 times應即以三次以上之公告，催告債權人於三個月內申報其債權，

*PS: any creditor failing to declare his rights of claims within the period will not be included in the liquidation
(unless liquidator know creditor ) 催報債權:並應聲明逾期不申報者，

if the liquidator known each of creditor , then it shall notify respectively其債權人為清算人所明知者，並應分別通知

(within 15 days After) the completion of liquidation清算完結時，清算人應於15日內，

329（未列入清算內之債權之清償）不列入清算內之債權人，
Creditors who have been excluded from the liquidation: could demand有清償請求權＞ performance out of the undivided residual assets of the company公司未分派之賸餘財產

special liquidation特別清算

others obstacles appears

in case the assets of a company is insufficient to set off its liabilities

  1. send them to the supervisors for examination.造具財務報表及財產目錄，

who will be liquidator?

director

court will appointed

In case of liquidation of a company, the directors shall become its liquidators §322

If no liquidator can be determined: the court may appoint a liquidator upon the application of any interested person.

  1. prepare the financial statements inventory of property送經監察人審查，提請股東會承認後

if there is residual asset?

it shall be distributed among the shareholders in proportion to the number of their shares (After the payment of debts)
-§330（賸餘財產之分配）清償債務後，賸餘之財產應按各股東股份比例分派.

prepare an income, expenditure statement, statement of profit and loss造具清算期內收支表、損益表、連同各項簿冊，送經監察人審查，並提請股東會承認

and shall forward the same together with all statements and records of accounts to the supervisors for examination

subsequently submit them to the meeting of shareholders for its ratification.

非37：向法院辦理清算終結登記，清算事務至終結登記後，始告全部辦理完竣，是以清算之公司於清算完結後，除向法院聲報外，仍應向法院辦理清算終結登記，其法人人格始歸消滅

The announcement of the completion of liquidation stipulated by the Company Law shall be made in writing and filing by the following documents:(非§180（清算完結聲報應附具文件）：

  1. shall examine the financial condition of the company, 應即檢查公司財產情形

the reason which initiate the procedure

A company limited by shares shall be dissolved under any of the following circumstances:（解散之法定原因）股份有限公司，應予解散：

merger

(a) the occurrence of an event of dissolution as specified under the Articles of Incorporation;一、章程所定解散事由。

(c) the adoption of a resolution to dissolve by the shareholders;三、股東會為解散之決議。

(e) except where the company is established by a government agency or a juristic person, the number of shareholders of the registered shares is less than two (in Taiwan, characteristically, a company must be dissolved if the sole shareholder is a natural person, while a company may exist if the sole shareholder is a juristic person); and

(f) an order to dissolve is issued by a competent authority or a judgment to dissolve is rendered by a court.

spin-off

bankruptcy

(b) where the objective of the business undertaken by the company has already been achieved or cannot be achieved;二、公司所營事業已成就或不能成就。

NOTE:

Tax collection agencies may still be entitled to recover the company’s payable taxes, and the company’s responsible person may also receive an official letter from the taxation authorities restricting him/her from going abroad.

all the material shall be done in writing((非§179普通清算程序之聲請)：公司法所定股東或股東會解任清算人之聲報、清算人所造具資產負債表或財務報表及財產目錄之聲報、清算人展期完結清算之聲請及法院許可清算人清償債務之聲請，應以書面為之

  1. Proof that the settlement list has been recognized by shareholders or the income and expenditure statement and profit and loss statement during the liquidation period have been recognized by the shareholders meeting(一、結算表冊經股東承認之證明或清算期內之收支表)(經股東會承認之證明)。
  1. Proof that the creditor's rights have been informed to the creditor after being urged by public announcement in accordance with regulations.(二、經依規定以公告催告申報債權及已通知債權人之證明)

Where do creditors and contributories rank on a debtor's insolvency?

When a debtor is in insolvency proceedings, the priority of payments is as follows:

Liquidators: the costs and expenses incurred by the liquidators in the liquidation proceedings.

Tax authorities: overdue taxes.

Secured creditors: for example, a pledgee and mortgagee who may claim a preferential payment on the amount of proceeds derived from the pledged/mortgaged property.

Unsecured creditors.

Shareholders: the residual or surplus will be distributed among the shareholders or contributors in accordance with the rights attached to their shares/contributions.

( as its liquidation is not completed in accordance with the Company Act and other relevant regulations> the corporate legal entity of a company is not eliminated after being dissolved, despite its settlement and liquidation having been declared)

During the procedure: negotiating with the employees reporting to the court, or noticing contract parties termination of contracts