In order to further clear the exit channel for market entities, lower the cost of exit for market entities, invigorate competition between market entities, improve the survival of the fittest market system, and push forward quality economic growth, with approval from the State Council, 13 departments including the National Development and Reform Commission recently jointly issued the Reform Plan for Accelerated Improvement in Market Entity Exit Mechanism.

According to Wei Meng, the press spokesman of the National Development and Reform Commission, market entity exit is an inevitable result of the survival of the fittest market mechanism. Accelerated improvement in market entity exit mechanism reform is beneficial to (i) deepening the structural reform on the supply side, and creating a good system environment for optimizing reserve, preventing and resolving overcapacity and accelerating clearance of zombie companies; (ii) optimizing the business environment and allowing China’s bankruptcy system to further adapt to its economic development and social improvement; and also (iii) beneficial to improving the socialist market economy system, optimizing the exit method, improving the exit procedure, and increasing exit efficiency.

Source: gov.cn