Opinions on Completing Corporate Merger and Division Registration to Support Corporate Merger and Restructuring

Opinions on Completing Corporate Merger and Division Registration to Support Corporate Merger and Restructuring

Gong Shang Qi Zi [2011] No.226

November 28, 2011

The industry and commerce administration bureaus and market supervision and control bureaus of all provinces, autonomous regions, municipalities directly under the Central Government and cities directly under State planning,

These Opinions are promulgated to enforce the Opinions of the State Council on Promoting Corporate Merger and Restructuring (Guo Fa [2010] No.27), regulate the registration of corporate merger and division and prompt companies to optimize industrial structures through merger and restructuring:

I. It is necessary to further enhance the sense of responsibility of companies providing support to the registration of corporate merger and division.
In order to accelerate the transformation of the economic development mode as demanded by the Central Government, companies in all industries and sectors have been constantly stepping up in merger and restructuring. As one of the major means of merger and restructuring, merger and acquisition can help improve the governance structure of the company, expand the company and enhance its market competitiveness; strengthen integration of resources and combination of strength, eliminate backward capacity, form massive and concentrated operation and promote industrial and structural optimization and upgrade.
Given the successful completion of merger and division registration is a fundamental role of the industry and commerce administration bureau as well as a requisite for the industry and commerce administration authority to serve scientific economic development and plays a significant role in supporting corporate merger and division, and stepping up the transformation of the economic development mode and strategic adjustment of the economic structure, industry and commerce administration authorities at all levels shall support and serve corporate merger and division as a major task in implementing the Scientific Outlook on Development from the perspective of the economic strategy of the State, further strengthen their sense of responsibility, fully exercise their role of market subject admission, and stick to the organic unity of exercising functions under law and serving corporate development, to provide efficient services for corporate merger and restructuring in a more voluntary, proactive and positive manner.

II. It is necessary to continue to provide good services for corporate merger and division
1.Supporting various forms of corporate merger, division and restructuring. Corporate merger can take one of two forms: a merger by absorption, in which a company absorbs another company and the absorbed company, is dissolved; a merger by formation of a new company, in which two or more companies are integrated into a new company, and the original companies are dissolved.
Corporate division can take one of two forms: derivative division, in which a company divides into one or more new companies, while the original companies continues; division by dissolution, in which a company divides into two or more new companies, while the original company dissolves.
2.Supporting corporate merger, division and restructuring. It is necessary to support legally incorporated domestically-funded companies in completing merger and division registration under these Opinions. Where a foreign-funded company is to be divided or continues or the newly founded company is a domestically-funded one, registration shall be completed under relevant law, administrative regulations and these Opinions.
3.Supporting companies in independently choosing the type of the restructured company. A company continuing or newly founded by merger and division shall have the discretion to choose the type of the Limited Liability Company or company limited by shares provided that it complies with the qualifications specified in the Company Law.
4.Supporting companies in completing restructuring registration simultaneously. Upon application for corporate merger and division registration, the applicant may simultaneously apply for corporate cancellation, incorporation or alteration registration within forty-five (45) days of publication of the bulletin.
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