the Pitfall of Period of Challenge in the case of Termination of Contract in China

A typical contract dispute is that one party unilaterally rescinds a valid contract by serving a termination notice to the other party citing some or no reasons. This drastic action often causes turmoil and substantial loss to the other party.

What can the non-terminating party do when caught in such a situation under Chinese contract laws? The answer is not…

Never forget to add a clear liquidated damage clause in your business contracts with China

The world is now sourcing various products in and from China. You may be one of them.

Wherever you do business with China (I mean, Chinese businessmen), you need to sign a contract with your Chinese counterparts.

Unfortunately, as a new market economy where most businesses esp the small ones don’t really know much about market, Chinese businesses don’t…

Unentitled disposal of assets: what are the legal effects under China laws?

My clients, two foreigners, operate a successful restaurant in Shanghai for a few years. They invest in the business but the restaurant was registered in two Chinese persons’ names in order to save time for starting the business. Of course, there is a contract between the two foreigners and the Chinese nominee shareholders. Recently, the two clients…

you need to define the word “deposit” in your business contracts with Chinese merchants

A client from the Middle East approached me recently seeking legal advice regarding a dispute with a Chinese supplier.

The client entered into an English-written contract with the Chinese supplier under which the supplier would supply the contractual goods at agreed price to the client. The contract stipulated that client shall make a “deposit”…