Winding-up a company in many cases can be coducted on a solvent basis, as a result of sound business reasons for international investors in China. Of course, in the case of bankruptcy , liquidation is a compulsory procedure in order to best protect the interests of creditors at large. For example, due to corporate deadlock(a situation where a company becomes stuck, when either a majority or greater number of required votes, as provided for by the company’s bylaws, cannot be reached with regards to the various issues in relation to the management of the company) among joint venture partners which reaches a point that paralyzes a company and persists for a sustained period of time thus detrimental to the company and its shareholders, or due to merger or acquisition ,where winding-up a business is the sole option or the natural step to be taken.

-How will the new social insurance law impact your company?

Employing expatriates has become increasingly difficult during the last few years. Initially, it was only up to the employer’s and employee’s negotiation skills to define the structure and content of an expatriate employment contract. Now, an increasing number of legal regulations constitute a detailed framework for an expatriate contract. After the discussion about tax and permanent establishment last year, the recently published new Social Insurance Law has again stirred up the expatriate community in China.

With the challenges of 2009’s downturn finally past, China now faces the return of the “War for Talent”. The pressure to hire “good” staff quickly and effectively is a challenge for even the most gifted HR departments. Even with the urgency of this situation, to minimize unwanted liabilities companies must not disregard legal requirements.

The People’s Republic of China Tort Liability Act, adopted by the National People’s Congress Standing Committee on December 26, 2009, will come into force on July 1, 2010. This law is an important part of the civil code system, providing a framework that protects the legitimate rights and interests of citizens and legal non- citizen employees. Tort Liability aims to promote social equality and justice, clarify the infringement liability definition, prevent and sanction the tort’s scope, and resolve social conflicts. There are some new requirements on enterprise management and attention should be paid for corporate management personnel, including human resource management.