What terms of the contract should you pay attention to before signing the contract
Signing a business contract with a Chinese company is a common practice for many investors in the country. Business agreements in China are formal and they usually mark the beginning of the relationship between parties (and they can still be amended as needed), as opposed to the European model that will oftentimes mark the conclusion of an arrangement.
When doing business with a Chinese company it is advisable to conclude the needed arrangements according to Chinese law. Our lawyers in China can advise you upon the clauses that you can include in the contract and the best ways to begin your new business relationship in the country.
1. Analyze the feasibility and legitimacy of the transaction
Whether it is possible; whether it is necessary; whether the transaction is prohibited by law; whether the content of the contract is protected by law.
2. Carefully verify the qualification of the other party to the contract
Verify whether the qualification of the contract subject is true, if it is a company, provide the business license information of the enterprise legal person, if it is an individual, provide the scanned copy of the id card;
To verify whether the contract subject is valid, a lawyer may be commissioned to conduct due diligence.
3. Fully investigate the credit status of the other party
The enterprise shall sign a contract within its business scope, and whether it has relevant qualifications to handle the matters stipulated in the contract.
Foreign investors doing business for the first time in China should make sure that the contract signed with a Chinese company includes detailed information about the business requirements and the legal implications for breaching the contract. When the contract is concluded for small amounts of money.
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