Legal analysis
Bankruptcy refers to a legal system in which the creditor or debtor requests the court to declare bankruptcy and repay the debt according to the bankruptcy procedure when the debtor is unable to repay the debt or insolvent. The narrow bankruptcy system only refers to the bankruptcy liquidation system, and the broad bankruptcy system also includes the reorganization and reconciliation system. In most cases, bankruptcy refers to an enterprise behavior and economic behavior. People are sometimes used to calling for the bankruptcy of individuals or companies. The definition of non-payment refers to the objective property situation that the debtor is unable to repay due to the loss of solvency, also known as non-payment or non-payment. The elements that cannot be paid off are: the debtor loses the ability to pay off. Determining whether the debtor has the ability to pay debts is generally based on the debtor's property, credit, labor and other factors. Paying money or property is the usual way to pay off debts; Credit repayment mainly refers to the debtor borrowing new debts to repay old debts, or agreeing to postpone repayment of debts; Paying off debts by ability mainly means that debtors pay off debts by providing services and skills accepted by creditors in exchange for money. When the debtor fails to pay off the debt in various ways, it constitutes the loss of solvency. The determination of insufficient solvency should be based on the objective state, that is, insufficient solvency is not an objective situation in which the debtor refuses to pay subjectively or maliciously, but cannot pay.
legal ground
Enterprise Bankruptcy Law of the People's Republic of China
Article 2 If an enterprise as a legal person is unable to pay off its due debts, its assets are insufficient to pay off all its debts or it obviously lacks solvency, it shall clear up its debts in accordance with the provisions of this Law. An enterprise as a legal person may be reorganized in accordance with the provisions of this law if it has the circumstances specified in the preceding paragraph or obviously loses its solvency.
Article 7 The debtor may apply to the people's court for reorganization, reconciliation or bankruptcy liquidation under the circumstances specified in Article 2 of this Law. If the debtor is unable to pay off the debts due, the creditor may apply to the people's court for reorganization or bankruptcy liquidation of the debtor. If an enterprise as a legal person has been dissolved but has not been liquidated or its assets are insufficient to pay off its debts, the person liable for liquidation according to law shall apply to the people's court for bankruptcy liquidation.