Tips of signing a formal contract with chinese supplier

Signing a formal Contract of Sale of Real Estate, is the final and most important part of the sale. When the negotiations have concluded, and both parties are satisfied with the deal, it is put in writing in the form of a written and legally Contract, where the parties both have signed under seal.

When signing a purchase/Sale contract, should pay attention to the following items:

1. The importance of detailed specifications
Most quality issues come from miscommunication and misunderstanding. Importers should keep track of all their requirements regarding the product and its packaging. For example, Commodity name, specification: should be expressed in detail and precise, esp for the quality aspect. If the quality has a standard to follow by, should also be described by national standard or industrial standard. Order on the basis of sampls, should keep the sample as the basis of final acceptance
When a good deal of customization is involved, and for large orders, these specifications should be translated in Chinese (for the factory technicians) and included in a contract. When the time comes for product checking, the inspector will use this information as a checklist
Set out clearly what the Chinese company must do to be in compliance with the contract, how disputes are to be resolved, Set out the liquidated damages the Chinese company must pay if it fails to comply with the contract; Many contracts are too vague to allow for effective action by the courts.
After an inspection fails, the supplier usually agrees to repair the problems and support the cost of the re-inspection. Detailed specifications are useful in avoiding endless negotiations with your supplier

2 The purchaser should consider buying insurance against any accidents (e.g. fire) which may result in loss or deterioration in the value of the flat after signing the provisional agreement or the formal agreement. The purchaser takes up the risk of the flat (e.g. any accident causing damage) once the provisional agreement or the formal agreement is signed

3 Have that written contract both in Chinese and English, Many contracts entered into by foreigners are simply unenforceable in China. A typical unenforceable contract is not written in Chinese, not subject to Chinese law and provides for enforcement outside of China.

4 Make sure the company's legal representative signed it, (A signature (in chinese) from the company's legal representative, you can tell who exactly is the company's legal representative from the business license) , and an appropriate seal (also called a chop) is applied to the contract. Once there is dispute, many foreign parties want to base a claim on a complex set of emails, oral communications and practice over time. This does not typically work in China. An aggressive lawsuit based on a clear written contract does work.