Legal basis: People's Republic of China (PRC) Company Law.
Article 185 The liquidation group shall notify creditors within 10 days from the date of its establishment and make an announcement in a newspaper within 60 days. Creditors shall, within 30 days from the date of receiving the notice, and within 45 days from the date of announcement if they have not received the notice, declare their claims to the liquidation group. When a creditor declares its creditor's rights, it shall explain the relevant matters of the creditor's rights and provide supporting materials. The liquidation group shall register the creditor's rights. During the declaration of creditor's rights, the liquidation group shall not pay off the creditors.
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.