Dor­mant SOEs to be reg­u­lated or shut down

China Daily (Canada) - - NEWS CAPSULE -

China will reg­u­late dor­mant state-owned com­pa­nies to en­sure they ei­ther re-start op­er­a­tion or file for liq­ui­da­tion, ac­cord­ing to an of­fi­cial state­ment.

Dor­mant com­pa­nies that have failed to sub­mit an­nual op­er­a­tion re­ports or tax dec­la­ra­tions for at least two con­sec­u­tive years must do so or they will have their busi­ness li­censes re­voked, ac­cord­ing to a state­ment jointly re­leased by the State Ad­min­is­tra­tion for Industry & Com­merce and the State Ad­min­is­tra­tion of Tax­a­tion.

The move will force non­per­form­ing “zom­bie en­ter­prises,” which waste re­sources, to shut down as they dis­tort the gen­eral eco­nomic pic­ture, the state­ment said.

The re­duc­tion of over­ca­pac­ity in sec­tors such as steel and coal is high on China’s re­form agenda this year and plans have been an­nounced to shut down non-per­form­ing plants and reem­ploy laid-off work­ers.

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