Contracts in China
Contracts in China

Be Cautious with Contract Templates, as It May Lead Failure to Recover Debts

Be Cautious when you use a contract template, otherwise, this may lead to an awkward situation where you have to apply for arbitration to an institution out of nowhere.

Incoterms CIF: Should Buyers Pay THC at Destination Port?

No. Sellers shall pay the cost of Terminal Handling Charges (THC) according to the International Rules for the Interpretation of Trade Terms 2010 (2010年国际贸易术语解释通则) (“Incoterms 2010”).

Is CISG Automatically Applicable in China?

The answer is YES, as long as the international sales of goods contracts are concluded between parties whose places of business are in different Contracting States of the United Nations Convention on Contracts for the International Sale of Goods (the “CISG”). In such cases, the Chinese courts shall apply the Convention automatically.

How Does A Chinese Court Determine Your Right to Claim If There Is Only A Simple Contract

If the content of the purchase order or contract entered into between you and the Chinese company is very simple, Chinese court may refer to China’s Contract Law to interpret your transaction between the Chinese supplier.

Can I Ignore the Transaction If the Goods of the Chinese Supplier Are Poor-quality?

You’d better not turn your back on your deals with Chinese suppliers. You shall terminate your contract in accordance with reasonable procedures.

How Can A Chinese Court Determine the Transaction Content If there Is Only A Simple Order?

If the contents of the purchase order or contract between you and the Chinese supplier are very simple, a Chinese court may refer to China’s Contract Law to interpret your transaction between the Chinese supplier.

How Do I Terminate a Contract With a Company in China?

You are entitled to unilaterally terminate a contract with a Chinese company only if the conditions for rescission as agreed in the contract or under Chinese law mature. Otherwise, you can only terminate the contract with the consent of the other party.

Can I Claim Compensation for the Loss That I Compensate My Customers All Caused by Chinese Supplier’s Fraud or Breach of Contract?

You should state in your contract such loss may be incurred in advance. As such, at least you should inform the supplier of such loss in the course of execution of the contract and seek his/her consent.

Can I Sue the Chinese Supplier Only With Emails Instead of a Written Contract?

Chinese courts prefer to accept written contracts with the parties’ signature.
However, with certain preparations made, contracts and orders confirmed by emails may still be accepted by Chinese courts.

3 Things You Have to Know About How Chinese Judges Think in Commercial Litigation

Chinese judges lack commercial knowledge, flexibility and time to understand transactions beyond the contract text.