Can A Foreign Company in Bankruptcy or Liquidation Sue A Company in China?

The answer is YES.

Suppose your company is an enterprise incorporated outside of China and is the process of bankruptcy or liquidation due to corporate deadlock, dissolution, reorganization, winding-up or other circumstances.

If a judicial administrator, liquidator or bankruptcy administrator (collectively referred to as the “administrator”) has been appointed for you by a court or other competent authorities in your country, such administrator will represent your company in litigation in China.

Therefore, if your administrator initiates an action against a Chinese company, it will have to prove its standing to represent the company by submitting relevant documents such as judgments and rulings rendered by the foreign courts in China and have such documents notarized and authenticated.

Such judgment or ruling may serve as evidence as to prove the qualification of such administrator without prior recognition by the relevant Chinese court.

In fact, is similar situations, Chinese courts treat Chinese companies in the same way as foreign companies. Once a Chinese company goes into process of bankruptcy or liquidation, its administrator or liquidator will take over all the lawsuits relating to such company.

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