Established in 2020, the Bankruptcy Liquidation and Reorganization Legal Affair Department of Yunnan Zhongji Law Firm is a division that can fully perform the duties of an administrator, support with business information throughout the entire process and provide legal services of enterprise bankruptcy in procedures related to bankruptcy liquidation and reorganization in accordance with the Law of the People's Republic of China on Enterprise Bankruptcy and as appointed by the court.

Brief Introduction

Established in 2020, the Bankruptcy Liquidation and Reorganization Legal Affair Department of Yunnan Zhongji Law Firm is a division that can fully perform the duties of an administrator, support with business information throughout the entire process and provide legal services of enterprise bankruptcy in procedures related to bankruptcy liquidation and reorganization in accordance with the Law of the People's Republic of China on Enterprise Bankruptcy and as appointed by the court.

 

The department consists of 18 experts and senior lawyers with rich practical experience and profound theoretical knowledge, including one director of the department, one chief expert in bankruptcy management and 16 senior lawyers. In the department, the core members include experts represented by Guo Dingming, Doctor of Law, Renmin University of China, researcher of Bankruptcy Law Research Center of Renmin University of China, Vice President of Bankruptcy Law Association, Yunnan Law Society. All members of the department, including Wan Li, Vice President of All China Lawyers Association, President of Yunnan Lawyers Association and Director of our firm, have set up a professional team of young and middle-aged lawyers with reasonable staffing and competitive business ability.

 

Our Bankruptcy and Reorganization Legal Affair Department has participated in the entire process from bankruptcy liquidation and reorganization to prepacked reorganization of super-large enterprises, such as the reorganization of Yunnan Highway Construction Group, reorganization of Kunming Qianyifeng Real Estate Development Co., Ltd., reorganization of Yunnan Renze Real Estate Development Co., Ltd., reorganization of Yunnan Jing Dian Group Co., Ltd., reorganization of Yunnan Murong Xincheng Real Estate Development Co., Ltd., reorganization of Kunming Yin Chuang Real Estate Development Co., Ltd., reorganization of Kunming Jingzhidian Real Estate Development Co., Ltd. and liquidation of Anning Jindi Chemical Industry Co., Ltd. Among them, Guo Dingming served as the expert advisor of the bankruptcy administrator team and provided direction for relevant work.

 

The department has also handled dozens of special legal projects of bankruptcy liquidation by means of special legal services, and these projects included “bankruptcy and reorganization of Kunming Electrochemical Plant”, “Kunming Dianchi National Tourist Resort”, “bankruptcy and reorganization legal services for South Asia Gate real estate project”, “special liquidation project of Southwest Transportation Construction Group Co., Ltd.”, “clearing project of Kokang Cigarette Factory in the First Special Zone of Shan State, Myanmar”, “urban village reconstruction project of the First City in South Asia”, “urban village renovation project of Ding Yi Tian Cheng”, “Kunming Economic and Technological Development Zone using foreign loans for infrastructure projects (BT construction of roads, water supply and drainage, river treatment, etc.)”, “administrative center construction, new town construction in the northern area (BT/BOT/EPC projects) and old town renovation projects in Jinghong city”, “acquisition, integration and restructuring of the tourism assets of the Bolian Group and the development of its tourism investment strategy”, “socialization reform of logistics support in Yan'an Hospital of Kunming City” and “liquidation of Yunnan Hualong Power Development Co., Ltd.”

 

With Guo Dingming as a representative, the department has long been paying close attention to academic research on bankruptcy and study in lawyer’s practice since its establishment. Publications include Study of Protecting Creditors' Rights and Interests in Enterprise Bankruptcy and Liquidation - Focusing on Perfection of the Law of the People's Republic of China on Enterprise Bankruptcy published by Law Press China; Analysis of Construction Contract and 100 Cases Practice, Analysis of Finance Lease and 100 Cases Practice, Analysis of Private Lending Dispute and 100 Cases Practice and Taxation Cases and Rules published by China Legal Publishing House, which indicates that our lawyers have profound theoretical knowledge of laws and extensive practical experience of bankruptcy and liquidation laws.

 

Scope of Services

1. Provision of legal due diligence service

We will sort out key content of legal due diligence according to characteristics of disposition of project bankruptcy, such as project company’s incorporation information and historical development; debts; residual assets available for sale; restrictions on production license, professional techniques, land and property rights; market value and liquidation value of existing assets; tax arrears; and related litigation and execution.

Professional due diligence lawyers will be responsible for the legal due diligence. The duration is flexible based on the debtor’s conditions and opinions from relevant government departments and the court. Our lawyers will stay on site to collect and collate information with the client's help.

2. Issuance of due diligence report

The due diligence report is mainly about the project company’s basic information, assets and debts, assets available for sale, related litigation and execution, asset value, etc.

3. Formulation of bankruptcy liquidation plan

After legal due diligence, a targeted liquidation plan will be formulated on the basis of the findings of legal due diligence with specified disposition methods and implementation date.

4. Submission of required application for bankruptcy and relevant documents to the court

(1) Submission of Bankruptcy Petition to the court;

(2) Submission of required documents to the court, including Employee Placement Plan, Audit Report, Statement of Assets, Details of Accounts, List of Credit, List of Debts, Details of External Guarantee, Litigation List, and Bankruptcy Property Realization Plan;

(3) Formulation of Bankruptcy Liquidation Report and organization of creditor’s meeting for review and consideration.

5. Risk points warning

When the due diligence report and disposition plan are under preparation, our department will refer to a concrete situation and offer warning against risk points as references for a bankruptcy proceeding, including but not limited to civil legal risk, administrative legal risk and criminal legal risk.

6. Communication with the creditor, debtor, court and government

In order to proceed smoothly, our department will make active communications with debtor enterprise, major creditor, the court and the government, so as to reach a consensus among all stakeholders and form a joint force.

7. Offering of legal advice

Our department will answer relevant legal questions raised by the debtor enterprise, creditor, court, and government in person and in writing.

8. Bankruptcy management plan

The bankruptcy administrator will make brief plans as reference for questions related to the debtor’s property management and investor introduction during the implementation of the bankruptcy management plan, to ensure that the debtor can keep the enterprise’s operation or bankruptcy in an orderly manner; that it can be considered to introduce intended investor to proceed reorganization; and that the debtor’s core operation value can remain.

 

(1) Collection of external claim: After entrustment, the administrator should categorize the debtor’s account receivables and adopt different collection plans. Actions of press for credit receivables should be taken actively against clients with no consistent business dealings and with abnormal payment collection by means of collection letters, collection by visits, and litigation.

 

(2) Assets disposition: After entrustment, the administrator will formulate a reasonable management and disposition plan according to the different conditions of assets. Assets disposition will be accelerated and promoted for assets with a high possibility of depreciation, high depository cost, and less impact on the main business’s operation after the first creditor’s meeting. In principle, such assets will be evaluated before the public auction by referring to the Provisions of the Supreme People’s Court on Auction and Sales of Properties in Civil Enforcement Proceedings by People’s Courts. With the agreement of the Creditor Committee, the administrator will proceed asset disposition and realization according to the actual situation to maximize asset value.

 

(3) Continued operation to introduce intended investors: The possibility of reorganization by introducing intended investors should be taken into consideration, and the operation management team, administrator, and creditor committee will work together to introduce capable investors via public offering with creditor’s support and cooperation to further realize reorganization and resumption.

 

During the debtor’s liquidation, if there is any necessity to put into effect the aforementioned property management plan, the administrator should draw up a specific plan, and the plan can be implemented after being declared to, where required, and approved by the creditor committee. The plan of introducing investors (in any) for reorganization should be eventually submitted to the creditor’s meeting for voting and declared to the court for final determination and approval.

 

Complete Quality Control System

The Bankruptcy Liquidation and Reorganization Legal Affair Department of Yunnan Zhongji Law Firm has a team of reasonable personnel placement and close collaboration, which can provide clients with full and multi-level legal services. The department proposes to take the following ways when providing legal services in order to ensure work quality:

 

1. Acceptance of instructions: In the department, experienced lawyers will be designated to team up and provide services for clients, and members of the department include partner lawyers and team lawyers. Guo Dingming and Su Lianjie will be designated as daily liaison representatives after cooperative ties with the client have been officially established. The client can convey any work instructions directly to the designated representatives. When the project is at an important stage, our firm will ensure that our client’s queries can be answered at any time by actively collaborating with project members to work on the site according to the client’s needs.

 

2. Business processing: After accepting work instructions from the client, the department will promptly assign the work to the most suitable lawyer on the basis of the nature of the work. For regular legal queries related to the project, answers will be given within 24 hours after reception of the instructions; for complex legal queries related to the project, answers will be given as soon as possible within 48 hours after reception of the instructions.

 

3. Quality control: The department has developed itself a service quality control system, which has been proven to be effective, including but not limited to creating soft copies of working documents for all written materials in legal services so that it’s available to look up and check related information and data at any time. A lawyer’s work log is created for all legal services and all lawyers are obliged to complete relevant work logs carefully for clients to learn about what legal services are about. A regular meeting system and a cross-discussion system are established internally in the service team for the sake of prompt communication and mutual corroboration and support to avoid any omission of major issues so as to ensure the quality of services for clients. Different from other law firms, the partners of our firm can deeply engage in the handling of the specific business, and almost all external legal documents such as legal due diligence report, legal advice, bankruptcy plan and liquidation scheme should be revised and reviewed by the lead partner.

 

4. Internal study: All lawyer participants in our firm will regularly convene to study and discuss problems in the services to provide better service for clients.

 

5. Professional advice: In terms of project-related questions, the department will analyze legal regulations, study cases of similar projects, and offer a special law memo to provide the most professional legal advice for clients.

 

Stringent Performance of Confidentiality Obligations

During legal services for the project, the Bankruptcy Liquidation and Reorganization Legal Affair Department of Yunnan Zhongji Law Firm shall strictly bear the following confidentiality obligations on all confidential materials and information of the project as provided by the client:

None of any confidential information will be used, except for the purpose specified in the project;

None of any confidential information will be disclosed to a third party, unless clear written authorization from the client is attained;

Only employees who are assigned to provide legal services and complete the project can have access to confidential information and the involved employees shall bear obligations of confidentiality;

If it’s determined to disclose confidential information to a certain government agency, or the department is required by laws to disclose confidential information, clients should certainly be informed of the situation immediately. The department will work with clients to apply for a protective order or seek other reliable protective measures to keep information to be disclosed as confidential as it can be, under the premise of complying with applicable laws and regulations.