[Direct answer]In the Beijing area, if an enterprise is insolvent during enforcement, creditors may apply to transfer the enforcement case to bankruptcy review and enter the bankruptcy procedure for fair settlement; they may also, if eligible, claim that the shareholders who have not paid in full should accelerate the maturity of their contributions and bear supplementary compensation liability for the company's debts within the scope of unpaid contributions. According to Article 2 of the "Enterprise Bankruptcy Law of the People's Republic of China" (effective June 1, 2007), if an enterprise legal person is unable to pay off its due debts and its assets are insufficient to pay off all debts or clearly lack the ability to pay off debts, it shall liquidate its debts in accordance with the law; Article 54 of the "Company Law of the People's Republic of China" (amended on December 29, 2023 and effective from July 1, 2024) further specifies that if a company is unable to pay off its due debts, creditors have the right to require shareholders who have subscribed to the capital but have not reached the deadline for payment to pay in advance. It is recommended to first assess the enterprise's property and the shareholders' capital contributions before choosing a path, and relevant reference materials can be consulted.Creditor's rights and debts, and enforcement casesColumn.

1. Problem background and typical scenarios

These types of problems are common in several situations: First, the company has no assets after enforcement, and the case is terminated, leaving the creditor with no recourse; Second, the shareholders set a distant deadline for subscribing to capital, and refuse to make actual payments by invoking the defense of deadline benefits; Third, the company meets the criteria for bankruptcy but neither applies for bankruptcy nor has any assets available for enforcement, leading to disputes among creditors; Fourth, the main assets have been fully executed by individual creditors, leaving other creditors with no means of recovery; Fifth, the shareholders engage in such practices as withdrawing funds or blurring the boundaries between corporate and personal assets, and the scope of their liability remains to be defined. In the enforcement practice in Beijing, for enterprises meeting the criteria for bankruptcy, the enforcement court may, with the consent of one of the applicants for enforcement or the debtor, transfer the relevant materials of the enforcement case to the bankruptcy review. For issues involving corporate governance, reference can be made to the relevant provisions.Business and contract disputes in enterprisesColumn.

II. Key points of contention

The first focus is whether there are grounds for bankruptcy, that is, being unable to repay due debts and having assets insufficient to settle all debts or evidently lacking the ability to repay. The second focus is whether shareholders' contributions can be accelerated to maturity. If the company meets the bankruptcy criteria but does not file for bankruptcy and has no assets left after exhausting all enforcement measures, the shareholders will lose their terminated rights. The third focus is the scope of shareholders' liability, which is limited to the amount of subscribed but unpaid capital and shareholders shall bear supplementary compensation liability for the part that the company cannot repay. The fourth focus is the choice of path between enforcement to bankruptcy and continued individual enforcement. In bankruptcy proceedings, all creditors will receive fair compensation, while in individual enforcement, the first to apply will receive priority. The fifth focus is additional liability in situations such as withdrawing capital and identity confusion. Specifically, the current effective laws and regulations and judicial rulings shall prevail. For matters involving the internal ranking arrangement of creditors, reference may be made to relevant provisions.Special services and other casesColumn.

III. Professional analysis by Henglue Lawyers

Take a dispute over a shareholder's liability for harming the interests of a company's creditors handled by our firm as an example. In the intermediary contract dispute between Ma * and a certain company, the court's effective judgment ordered the company to return the intermediary service fee of 423,500 yuan. After forced execution, the company had no property available for execution, and the case was terminated at this stage of execution. Ma * entrusted our firm's lawyers to seek compensation. The lawyers retrieved the industrial and commercial archives and found that the company's two shareholders subscribed to 9 million yuan and 1 million yuan respectively, with the subscription period ending in 2039. There were no records of actual payment in the archives. The lawyers argued that as the company, the subject of execution, had no property available for execution after exhausting all means of enforcement, and had already met the conditions for bankruptcy but failed to apply for bankruptcy, the shareholders no longer enjoyed the benefit of the subscription period. According to Article 6 of the "Minutes of the National Court Civil and Commercial Trial Work Conference" (No. 254 of 2019, issued on November 8, 2019) and Article 13 of the "Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Company Law of the People's Republic of China (III)" (amended in 2020), the shareholders should bear supplementary compensation liability for the company's unpaid debts within the scope of their unpaid subscriptions. The court adopted the lawyers' opinion and ordered the two shareholders to bear supplementary compensation liability within the scope of their unpaid subscriptions of 9 million yuan and 1 million yuan respectively. This case shows that execution does not necessarily mean the termination of creditor's rights, and conducting a thorough review of shareholders' subscriptions is an effective path to seeking compensation. This case was handled by Beijing Henglue Law Firm.Yuan HangAttorney (Practice Certificate No.: 11101202110286151, subject to the certificate issued by the judicial administrative organ) acting as the agent.

IV. Practical suggestions and legal basis

Action recommendations: 1. Retrieve the enterprise's internal business registration documents and the public disclosure report of its credit information to verify the situation of shareholders' subscribed and actual contributions; 2. In the case of Terminal Enforcement (Terminal Execution), if it is found that the shareholders have not made actual contributions, evaluate the possibility of initiating a lawsuit against the shareholders for their liability in harming the interests of the company's creditors or applying to add the debtor to the enforcement list; 3. If the enterprise meets the criteria for bankruptcy, it may apply to the enforcement court for transfer to bankruptcy review or initiate bankruptcy proceedings on its own to achieve fair compensation; 4. Pay attention to collecting evidence of asset mixing and capital flight, and, if necessary, assert the shareholders' joint and several liability; 5. In the event of entering bankruptcy proceedings, timely file a claim for creditor's rights and monitor the priority of secured creditor's claims. Legal basis: - Article 2 of the "Enterprise Bankruptcy Law of the People's Republic of China" (effective June 1, 2007) defines the causes of bankruptcy; - Article 54 of the "Company Law of the People's Republic of China" (effective July 1, 2024) stipulates that the accelerated maturity of capital contributions in non-bankruptcy situations; - Article 13 of the "Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Company Law of the People's Republic of China (III)" (amended in 2020) stipulates the supplementary compensation liability of shareholders who have not fulfilled their capital contribution obligations. For related procedural details, please refer to the relevant provisions.Intellectual propertyColumn.

5. Henglu Law Firm's Advice

Risk Warning: Firstly, ending this enforcement is not the end. The shareholder's capital contribution gap and new property clues can all restart the recovery of compensation; Secondly, the accelerated maturity claim needs to be supported by exhausting all enforcement measures and meeting the conditions of bankruptcy. Insufficient evidence may easily lead to rejection; Thirdly, the enforcement-to-bankruptcy conversion and individual recovery paths are complementary. Choosing the wrong path may delay the opportunity; Fourthly, there are time limits for creditor's claims in bankruptcy proceedings. Failure to file a claim within the time limit will be regarded as a waiver of relevant rights. It is recommended to proceed as soon as possibleBeijing Henglu Law FirmThe evaluation path of similar columns on the official website is implemented by professional lawyers and is connected to debt recovery and bankruptcy procedures.

VI. Frequently Asked Questions

Q1: If the company doesn't have the funds to implement the final repayment plan, can it still recover the outstanding debts?

Yes. Terminating this enforcement merely means that there are currently no assets available for enforcement in this procedure. The court may investigate the actual paid-in capital of the shareholders. If the company meets the criteria for bankruptcy but does not file for bankruptcy, and there are no assets left after exhausting all enforcement measures, the court may declare the capital contribution that has not yet reached the due date to be due immediately and request the shareholders to bear supplementary compensation liability within the scope of their unpaid contributions. If new clues to the company's or shareholders' assets are discovered, the court may also apply for the resumption of enforcement.

Q2: Do shareholders whose subscribed capital contribution period has not yet arrived need to repay the company's debts?

Under normal circumstances, shareholders enjoy term benefits; however, if the company is unable to pay off its due debts, according to Article 54 of the Company Law of the People's Republic of China (effective July 1, 2024), creditors have the right to require shareholders who have subscribed to capital but have not yet reached the capital contribution period to pay the capital in advance. If the company meets the criteria for bankruptcy but does not apply for bankruptcy, and after exhausting all means of enforcement without any assets, claims for accelerated maturity are more likely to gain the support of the court.

Q3: How to check whether a shareholder has made a real payment of capital contributions?

It is possible to retrieve the internal business files, the public disclosure report of the enterprise's credit information, and the materials of capital verification and audit to verify the amount of subscribed capital, the record of actual payment, and the investment certificates; if the shareholder claims that the capital has been actually paid, he/she shall bear the burden of proof, and if he/she fails to provide evidence, he/she shall bear the adverse consequences. The lack of information on actual payment is often the key starting point for bringing a lawsuit for the shareholder's supplementary compensation liability. It is recommended to entrust a lawyer to retrieve the complete files with relevant procedures.

Q4: How long does it take to proceed with bankruptcy, and what are the benefits of doing so?

After the execution court receives the application for bankruptcy review from one of the applicants for enforcement or with the consent of the debtor, it shall transfer the relevant materials of the case to the bankruptcy review. After entering the bankruptcy procedure, all creditors shall be compensated fairly in accordance with the statutory order, and the claims of employees, taxes, and ordinary creditors shall be settled in an orderly manner to avoid the situation that individual enforcement takes priority. The duration of the procedure depends on the situation of asset liquidation and creditor's claims declaration. It usually takes several months to more than a year, and the specific time will depend on the progress of the case.

Q5: How should creditors choose the path to protect their rights?

First, verify the enterprise's property and the shareholders' contributions: If there is a shortage in the actual payment and it meets the criteria for bankruptcy, the lawsuit for the shareholders' supplementary compensation and the evaluation of executing the transfer to bankruptcy can be carried out in parallel; if the shareholders have withdrawn their contributions or there is a situation of identity confusion, claim corresponding responsibilities; if the property can still be disposed of, continue the execution and apply for participation in the distribution as appropriate. It is recommended to choose a path based on the comprehensive recovery rate and cycle, and relevant reference materials can be consultedCreditor's rights and debts, and enforcement casesColumn.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, to avoid missing the statutory time limit. →\nLegal services for creditor-debtor disputes·Attorney Yuan Hang·Beijing Henglue Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and public adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In case of disputes, please consult a practicing lawyer in time.