Why English alone does not work
A Chinese court will read the Chinese version. If there is no Chinese version, one will be produced by translation, and the terms you thought were clear will become arguable at the worst possible time.
More practically: the person on the factory floor who decides whether to substitute the foam has not read your English purchase order. Give him a document he can read, chopped with the company seal, and the calculus changes.
The clauses that matter
- The sealed sample. Reference it explicitly. The contract should say that goods are to conform to the sample sealed on a date, photographed and held by both parties.
- Material substitution. Define it as a defect, not a variation. Specify that a change of material or supplier without written approval requires rework at the factory's cost.
- Inspection and payment. The balance is payable after a pre-shipment inspection at a named AQL level. This is the clause that does the actual work.
- Mould ownership. If you paid for the tooling, the mould is yours, with the drawings attached, and it can be removed. Without this clause it stays.
- Packaging specification. Carton, drop test, labelling. A packaging change is a quality failure with a freight cost attached.
- Exclusivity, if you paid for it. Otherwise your design will be on a competitor's shelf, legally.
The company chop
In China the company seal, the chop, is what binds the company. A signature from a sales manager is much weaker. Get the contract chopped, and check that the name on the chop is the entity that will issue the invoice and receive the payment.
If the entity receiving your money is different from the entity signing the contract, stop and ask why. That mismatch is one of the most reliable signals of a problem.
What it is really for
Very few importers ever litigate in China, and we do not recommend planning around it. The contract earns its value on ordinary days: when the factory has to decide between a shortcut and the thing they agreed to, in writing, in their own language, with the balance payment still unpaid.
- The contract must exist in Chinese and be chopped, not just signed.
- Reference the sealed sample, the AQL level and the balance-after-inspection term.
- Write mould ownership down if you paid for the tooling. Otherwise it stays in the factory.
- Check that the entity receiving your payment is the entity that signed. A mismatch is a red flag.
