When a company goes bankrupt, it needs to perform liquidation procedures. As the company's property, the company's intellectual property patents should be used for bankruptcy liquidation first. Intellectual property rights that still exist after liquidation shall be inherited by the shareholders of the company. Where the trademark right or patent right is transferred, the formalities for change shall be handled. China's "Company Law" stipulates that after clearing the company's assets, preparing the balance sheet and list of assets, the liquidation group shall formulate a 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.