Published : 2025-08-03
On August 3, 1986, the Shenyang Explosion-proof Equipment Factory (瀋陽防爆器械廠) went bankrupt, becoming the first state-owned enterprise to go bankrupt after the founding of the People's Republic of China.
The Shenyang Explosion-proof Equipment Factory was established in 1966 and was just a small enterprise with fewer than a hundred employees.
Due to poor management, the factory had been incurring losses for 10 consecutive years. By the end of 1984, its debt had reached as high as 480,000 RMB, with liabilities exceeding two-thirds of its total assets.
By August 3, 1985, according to relevant trial regulations, the Shenyang Municipal Government issued a "bankruptcy warning notice" to three severely insolvent enterprises, including the Shenyang Explosion-proof Equipment Factory, giving them a one-year period to reorganise.
One year later, on the same day, due to the continued poor management and severe insolvency of the Shenyang Explosion-proof Equipment Factory, it went bankrupt and was liquidated effective immediately, with its business license revoked and bank accounts cancelled.
