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As one of the best companies in the world, this small company based in Wuhan, China, has attracted a lot of attention with its huge registered capital of 153 trillion yuan. How staggering is that number?Based on China's projected GDP in 2023, it is about 120-130 trillion yuan, which means that the registered capital of this small Wuhan company exceeds the annual GDP of the whole of China and almost the same as the annual GDP of the United States. In other words, it has more financial resources than large companies such as Tesla and Apple. Surprisingly, before that, the most indebted Chinese company we know of was Evergrande Group, with a debt size of more than 2 trillion yuan, but the Wuhan company easily surpassed Evergrande's external debt by 70 times. Such a company with such a large registered capital has undoubtedly aroused the public's curiosity about its strength and the funds behind it. By checking the business license, it can be clearly seen that its registered capital is 153 trillion yuan. However, some attentive netizens have also noticed the peculiarity of this number, which is not an integer, but a continuous 11-digit number. Some people have questioned whether the company made a mistake when filling in the registered capital, and the number filled in looks like a mobile phone number. However, after the reporter's consultation with the local industrial and commercial registration department, they said that in the case of normal receipt, as long as the company's registered capital does not violate laws and regulations, they must allow normal registration. So they don't know if the company has made a mistake or not, and they don't know the details of what to do. This actually involves an issue, for the past 10 years, our company law has stipulated that the registered capital is a subscription system. What does that mean?Even if you don't have a dime in your pocket, you can register a company with a registered capital of 1 billion RMB, and your articles of association can stipulate that you will contribute this capital within the next 99 years. Therefore, in the past few years, a large number of empty shell bag companies have emerged around us, and their registered capital is as high as tens of millions or even hundreds of millions of yuan on the surface, but in fact they have not paid a penny, and this situation is legal. Therefore, the new company law, which will come into effect in July this year, fills this loophole by specifically stipulating the requirements for the subscription of registered capital. The new company law stipulates that any company must complete its capital contribution obligation within 5 years. It can't be delayed until 99 anymore, lest more empty shell bag companies appear. For example, the registered capital of this company is as high as 153 trillion yuan, then it is necessary to raise this amount of money within 5 years, but we also know that it is almost impossible, even if you sell all the apples and Tesla, it is impossible to have so much money. Therefore, it can be inferred that the registered capital of this company is most likely a mistake, or because the registrant was initially not aware of the imminent entry into force of the new company law, thinking that it was possible to create a purse company without interference. Therefore, the reporter's investigation also found that the company is currently undergoing a simple cancellation process, and they know that with such a large registered capital, there will definitely be a lot of troubles in the future. The new company law will take effect immediately and will retroactively address past circumstances. In other words, for many shell bag companies registered in the past few years, if your registered capital is particularly large, then it is time to consider whether you have the ability to raise funds within 5 years, if not, you need to consider reducing or canceling the capital, otherwise you will face trouble.
Over the years, China's company law has stipulated the subscription system of registered capital, which has a serious defect, which has made a large number of empty shell bag companies emerge in an endless stream. According to this system, an enterprise can register a large amount of registered capital that does not match its actual financial resources, and there is no obligation to contribute capital for a long period of time. This has led to many companies that seem to be powerful on the surface, with registered capital as high as hundreds of millions of yuan, or even higher, but in fact they have not paid a penny. To a certain extent, this phenomenon misleads the market and investors, and at the same time exacerbates unregulated competition in the economic field. Faced with this situation, the new company law proposed an amendment plan to try to solve this problem.
According to the provisions of the new company law, the registered capital is still the subscription system, but there are stricter requirements for enterprises. Now, any company must complete the obligation to contribute to the registered capital within 5 years. This means that companies have to raise the corresponding funds in a shorter period of time, and can no longer delay until 99 years, as was the case before. The purpose of this new regulation is to put an end to the emergence of shell bag companies, thereby promoting the healthy development of the economy. As an important legislative initiative, the implementation of the new company law will bring a fairer and more transparent market environment for Chinese enterprises.
The implementation of the new company law has undoubtedly brought some challenges and reflections to those large enterprises with large registered capital. According to the new regulations, these large enterprises are required to complete the obligation to contribute capital to the registered capital within 5 years. However, many companies may not be able to raise such a large amount of capital in a short period of time, which requires them to face a series of problems and considerations.
First, large companies need to weigh the pros and cons when faced with the decision to reduce or deregister their capital. A reduction in capital may be a solution, but it also means a reduction in the size and financial strength of the enterprise. In contrast, deregistration may be a more sensible option, but it also comes with a series of legal procedures and follow-up matters that may place a certain burden on the business. As a result, large companies need to carefully evaluate their options to ensure that they can continue to operate or exit the market in a way that complies with the law and protects their interests to the greatest extent.
Second, large enterprises need to strengthen the monitoring and control of financial management. It is not easy to raise a large amount of capital in 5 years, and companies may need to develop a detailed capital plan and strategy to ensure that they can meet their capital contribution obligations on time. This means that enterprises need to strengthen the ability and professionalism of the financial management team, and do a good job in the allocation of funds to ensure that the enterprise can operate and develop steadily.
Finally, large companies need to think about long-term development. The implementation of the new company law marks the further improvement and standardization of China's company system, which is a moment of coexistence of opportunities and challenges for enterprises. Companies need to be clear about their long-term development goals and develop corresponding strategies and measures to adapt to the new legal environment. This may involve the adjustment of the enterprise structure, the optimization of the financing plan, and the transformation of the business model, which requires the wisdom and foresight of the senior management of the enterprise.
In short, the implementation of the new company law will inject new vitality into China's economic development. This is a thought-provoking moment for those large enterprises with huge registered capital. In the face of new legal regulations and challenges, companies need to assess the situation, strengthen management and planning, ensure that they can meet their capital contribution obligations on time, and prepare for long-term development. At the same time, China and relevant departments also need to provide better support and guidance for enterprises to jointly promote the healthy development of China's economy.
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