Legal analysis: enterprise division refers to the legal act of dividing an enterprise into two or more enterprises in accordance with the provisions of relevant laws and regulations. Separation refers to the legal act of dividing an enterprise into two or more enterprises according to the provisions of relevant laws and regulations. Enterprise separation refers to the distribution of the shares owned by the parent company in the subsidiary to the shareholders of the parent company in proportion to form a new company with the same shareholders as the parent company, thus separating the subsidiary from the parent company legally and organizationally.
Legal basis: People's Republic of China (PRC) Company Law.
Article 175 When a company is divided, its property shall be divided accordingly. When the company is divided, it shall prepare a balance sheet and a list of assets. The company shall notify the creditors within 10 days from the date of making the resolution of separation, and make an announcement in the newspaper within 30 days.
Article 176 The debts of the company before division shall be jointly and severally liable by the company after division. However, unless the company and creditors reach a written agreement on debt settlement before division.