Mainland private enterprises continue to close down in the face of the economic crisis, Shenzhen set up a bankruptcy affairs administration

As the tide of private enterprise failures continues in mainland China, officials have begun to take countermeasures, with the Shenzhen Special Economic Zone Personal Bankruptcy Ordinance coming into effect on March 1. On the same day, the Shenzhen Bankruptcy Administration, China’s first personal bankruptcy agency, was launched.

The mainland official media reported that some countries and regions in the world with more mature market economies have established personal bankruptcy systems. Shenzhen took a step ahead by enacting the Shenzhen Special Economic Zone Personal Bankruptcy Regulations in 2020. The regulation takes the lead in filling the gap in the system of rescue and treatment of market subjects, improving the orderly exit mechanism of market subjects at the individual level, and establishing a four-in-one bankruptcy processing system of “court adjudication, institutional management, administrator execution and public supervision”.

The Shenzhen Bankruptcy Administration is mainly responsible for the management of individual bankruptcy administrators, the implementation of bankruptcy information registration and information disclosure system, the provision of bankruptcy consultation and assistance services, and the establishment of a sound coordination mechanism for government departments to handle individual bankruptcy affairs.