Luxury E-commerce Platform Secoo’s Shanghai Subsidiary Given Notice of Bankruptcy Filing

On August 25, Shanghai Secoo E-Commerce Co., Ltd., an affiliated company of luxury e-commerce platform Secoo, added a bankruptcy review case. The applicant was Shanghai Weiqi Trading Co., Ltd. and the handling court was the Shanghai Third Intermediate People’s Court.

The company was established in September 2013 with a registered capital of 120 million yuan ($17.51 million). Its legal representative is Meng Xiangjun and is wholly owned by Beijing Secoo Trading Co., Ltd. It is worth mentioning that Beijing Secoo Trading has also been given notice of bankruptcy filing twice.

Since last year, it has been reported that Secoo has defaulted on employees’ wages, defaulted on the payment of goods to suppliers, and failed to deliver and refund orders placed by users. Commercial inquiry platform Tianyancha shows that Beijing Secoo Trading Co., Ltd., has been listed as a restricted high-consumption enterprise by the court in July this year, and the total amount of enforcement by the court for failing to fulfill its legal obligations on time is as high as 21.91 million yuan ($3.2 million). It also shows that the risk warning of Secoo is more than 999, and the number of judicial cases involved is 509, of which 90.18% are defendants.

SEE ALSO: Embattled Luxury E-Commerce Platform Secoo Denies Desertion Reports

But the company is facing more than just those negatives. On August 17, Secoo was revealed to have practically no staff left and the social security of employees was cut off, a matter which the company is regarded to have run away with the money. However, Secoo responded that the office space has not been reduced at present, and it is in normal state.

As of the close of August 25, Secoo’s share price was only $0.33, and its market value had shrunk from $770 million at its peak to $23.6333 million. In December 2021, Secoo received a warning from the NASDAQ to delist. According to NASDAQ standards, listed companies whose share prices are lower than $1 for 120 consecutive days will be forced to delist. At the current rate, Secoo’s stock will soon be de-listed.