[Consultation] Review of Property Disposition upon Dissolution of a Nonprofit Corporation

When people think of a corporation, they usually think of a company, but the broad concept of a corporation also includes non-profit corporations that aim for non-profit business activities. According to Article 102 of the Civil Law, non-profit corporations are defined as those that aim for academic, religious, charitable, artistic, social, or other non-profit business activities, and are further divided into non-profit associations and non-profit foundations. The establishment and dissolution of non-profit corporations are subject to the Civil Law and the rules regarding the establishment and supervision of non-profit corporations by each administrative agency, so clear legal review is necessary.

Many research institutions are legally characterized as non-profit corporations under the Civil Law due to their establishment for public or academic purposes. Foundation A was also established as a non-profit foundation for the purpose of developing technology that is not for profit, and after being established according to related laws and regulations, it continued its operations through active research activities.

Foundation A completed its activities and dissolved the foundation, and in the process, it inquired with Law firm Veat about how to handle the remaining assets in order to prevent future legal problems. Accordingly, our Law firm Veat reviewed the Foundation A’s articles of incorporation, related regulations such as the Civil Law, and rules regarding the establishment and supervision of non-profit corporations by the relevant administrative agency, and was able to provide advisory opinions on the procedures for the transfer of remaining assets and their legal consequences.