Legal basis: People's Republic of China (PRC) Company Law.
Article 184 During the liquidation period, the liquidation group shall exercise the following functions and powers: (1) Clean up the company's assets and prepare a balance sheet and a list of assets respectively; (2) Notify and announce creditors. (3) Handling the unfinished business of the company related to liquidation; (four) to pay the taxes owed and the taxes generated in the liquidation process; (5) Clearing up creditor's rights and debts; (6) Disposing of the company's remaining property after paying off debts; (seven) to participate in civil litigation activities on behalf of the company.
Article 186 After clearing up the company's assets, preparing the balance sheet and list of assets, the liquidation group shall formulate the liquidation plan and report it to the shareholders' meeting, shareholders' meeting or the people's court for confirmation. After paying the liquidation expenses, employees' wages, social insurance expenses and statutory compensation, paying the taxes owed and paying off the company's debts, the company's property shall be distributed according to the proportion of capital contribution of shareholders of a limited liability company and the proportion of shares of shareholders of a joint stock limited company. During the liquidation period, the company shall survive, but shall not carry out business activities unrelated to liquidation. The company's property shall not be distributed to shareholders before it is paid off in accordance with the provisions of the preceding paragraph.