As cross-border trade and investment between China and the rest of the world continue to expand, disputes between foreign companies or individuals and Chinese businesses have become increasingly common. These disputes often involve contract performance, delayed shipment, payment defaults, or product quality issues. For foreign parties, the key concern is: how to effectively and legally resolve such disputes in China while protecting their rights? Common Types of Cross-Border Contract Disputes Contract performance issues: late delivery, failure to meet agreed standards. […]

Linked Companies Dealing with Chinese Financial Institutions in 2025 (Based on the People’s Republic of China Anti‑Money Laundering Law effective January 1, 2025 (2024 amendment), related PBOC regulations and FATF’s Fifth Evaluation Requirements) 1. Scope & Regulatory Framework Any foreign-linked entity conducting business with Chinese financial institutions—including the 27 branches and licensed subsidiaries directly supervised by the People’s Bank of China—is considered an “obligated associate” and must comply with China’s AML requirements. Regulators include: the AML Bureau of the People’s Bank of China, the National Financial […]

Understanding Shareholder Liability in Company Debts In business operations, defining the responsibilities of a company and its shareholders is crucial. According to China’s Company Law, a company’s debts are its sole responsibility and have no direct connection to its shareholders, employees, or other entities. Limited Liability of Shareholders Article 4, Paragraph 1 of the Company Law states that shareholders of a limited liability company are responsible only for the capital they have committed (the subscribed capital). This means that beyond […]

According to Dronelife.com, there are over 500 drone manufacturers worldwide, with around 400 of them based in China. In fact, 8 out of the 13 bestselling drones in 2015 were Chinese brands. This highlights China’s dominance in the international consumer drone market. If you’re looking to sell drones in your online or retail store, China offers the best selection of high-quality, reliable suppliers. However, finding a trustworthy supplier requires careful planning, patience, and due diligence. You can either handle the […]

When foreign businesses venture into the Chinese market, they frequently confront a variety of legal and regulatory barriers. To assist in overcoming these difficulties and steer clear of typical missteps, this advisory identifies the primary issues you are likely to encounter. Here are the five principal challenges associated with conducting business in China. Challenge 1: Regulatory constraints on currency and foreign exchange The State Administration of Foreign Exchange (SAFE), established in 1979, is the authority that oversees foreign exchange transactions […]

If you’re planning to file a lawsuit in China, it’s essential to understand the legal requirements and processes to ensure a smooth and effective litigation experience. Here are the top points foreign litigants should keep in mind when pursuing legal action within the People’s Republic of China. 1. Understand the Chinese Legal System Thoroughly Foreign litigants should familiarize themselves with China’s unique legal system, which is rooted in civil law and distinct from the common law systems often used in […]

We often receive inquiries like this: “I purchased goods from China, but after sending the payment, the seller cannot be contacted.” “I transferred the payment to a Chinese seller, but they are delaying the shipment.” Usually, customers who encounter such situations hope to report to the police and have the other party arrested or use the threat of imprisonment to compel them to fulfill their obligations as soon as possible. However, we have to respond to customers from a professional […]

Clients often ask, “My supplier is not delivering goods, causing me significant losses. My downstream customers have left, and I’ve lost profits. My reputation in the local market is tarnished. Can I claim compensation?”   The answer is yes.   According to Chinese law, if a supplier fails to deliver, it violates the agreement between you. If you have a contract that clearly specifies liquidated damages for such breaches, you can demand compensation from the supplier as per the contract […]

This case is a international trade dispute case, and because the defendant resides in Shenzhen, we chose to file a lawsuit in the Shenzhen court.   In 2020, our client placed an order for Vulkollan and TPU polyether with the agent by email, and the agent issued a proforma invoice to our client’s Italian company by email. The proforma invoice showed the supplier as a company in Shenzhen, but there was no official stamp of the Shenzhen company on the […]

Our client is a large-scale Chinese company, engaged in cereal and oil business. After supplying to the Shenzhen company for one year, it had not received nearly 2 million yuan in payment. The debtor, Evergrande Group, has a very serious debt problem.  Considering that the debtor was in poor operation, it was likely that even if we win the lawsuit, we could not be able to deduct money from Evergrande Group,. Near the opening of the trial, the defendant Evergrande […]