The deadline for the annual report for YEAR 2013 and YEAR 2014 has expired on 30 June 2015. For any company which missing such annual report, it has been listed on the “abnormal operation” list and the company can check it on the state company publishing system (http://gsxt.saic.gov.cn/). The company which was put on such “abnormal operation” list may meet the below problems during its daily operation.
1. An irrevocable bad record: the record that the company has been ever put on the “abnormal operation” list cannot be clear even if the company makes up for the mistake.
2. Administration restriction: the company can hardly invite to or submit of the tender, make governmental purchase, be given the prize or honor, or even update other license.
3. Commercial restriction: the company can hardly make the loan from the bank, act as the guarantor, or apply for the insurance. The company may even not pass the identity verification on the popular online platform (e.g. Alibaba, Sina Weibo).
4. Business restriction: the business partners will check your company status. If it is found on the “abnormal operation” list, there is big possibility that they will not enter any agreement with your company.
5. Black list: after three-year putting on the “abnormal operation” list, the company will move to the final “black list”.
6. Senior management restriction: the legal representative, directors, supervisors, or other senior management (general or vice manager, financial officer, secretary of the BOD for a listing company) for the company which is put on the “black list”, he/she cannot take such position for the other company within three years.
Further, according to our experience, there are four common situation that the company will be put on the ”abnormal operation” list.
1. The company does not file the annual report on time;
2. The company does not file the company changing information on time (i.e. the equity transfer, the capital contribution, the administrative permit/punishment, IPR pledge);
3. The company submitted the false information;
4. The officer cannot find the company on its registration address;
Shanghai Dongjin reminds you that the company should be keep a close eye on checking the status and solve the problems in time.
If you want to know more details, please contact our senior consultant.
Ms. Jojo Hu
TEL: 0086-21-68868335 ext 324 / FAX: 0086-21-68868021