Sourcing From China

In buying product from China, much will depend on both sides understanding the intended terms of the deal, and the extent to which you will be able to reduce the deal to writing and achieve some level of enforceability.

Flows of liabilities, and in fact the business deal itself, are controlled by the contract between the parties. Care should be taken in understanding contract law of the countries where one will be conducting business. In China contract law is unreliable and one may want to make contracts in China subject to Hong Kong law, with Hong Kong as the venue for dispute resolution. Also, arbitration may be a more reliable solution for disputes, rather than litigation.

Personal property being shipped to China (e.g. raw materials) and from China (e.g. finished product) needs to be insured in transit, and control over the insurance should be maintained in all cases if at all possible. If the transit insurance will be handled by the foreign party, the sale should be on terms whereby risk of non-insurance or poor insurance falls to the party arranging the coverage, not to the innocent party. It is often not possible to know the financial strength and reliability of certain Chinese insurers.

We will help you understand the risks inherent in business deals in China, and ways in which such risks can be managed to the fullest extent possible.

cannot enter into alliances until we are acquainted with the designs of our neighbors.”

Sun Tzu, ancient Chinese warrior and philosopher