When a Chinese supplier has kept your deposit, shipped goods that fail inspection or stopped answering, the first decision is where a claim can reach its money, not who is right. Usually it is the court where the supplier is based or where the contract was performed (Civil Procedure Law art. 24), or the arbitration body named in your contract, with an asset freeze before or with the claim (arts. 103 and 104). The time limit for a cross-border sale of goods is four years (Civil Code art. 594). A written dispute assessment costs USD 590, within 5 business days.
Start from what went wrong
| Your situation | Fixed fee | What we do |
|---|---|---|
| Goods not delivered, or the deposit not refunded | Assessment USD 590; demand letter USD 950 | Establish who received the money, whether the payment was a forfeitable deposit or a refundable prepayment, and the fastest route to recovery; then a demand letter on the firm's letterhead if it is worth sending. |
| Goods failed inspection or do not match the sample | Assessment USD 590 | Check the evidence that decides quality claims (sealed samples, specification, inspection report, timely written notice) and whether to claim a price reduction, replacement, return or damages. |
| The supplier has gone silent, or you are ready to sue | Assessment USD 590; court or arbitration quoted per stage | Search the supplier's registration, assets and enforcement record, apply to freeze its accounts where the evidence supports it, and file in the court or arbitration body that can reach them. |
Whether a deposit can be recovered often turns on whether the contract made it a forfeitable deposit or a prepayment; our article on getting a deposit back from a Chinese supplier explains the difference. A demand letter to one supplier, in Chinese and English on the law firm's letterhead, is USD 950. If you instruct it within 30 days of the assessment, the USD 590 is credited in full. Litigation and arbitration are quoted per stage once we have read the file, so you know the cost of each step before taking it.
Court or arbitration: your contract may already have decided
Read the dispute clause before anything else. If it contains a valid arbitration agreement, a Chinese court will generally send the case to arbitration. If it names a court, the choice binds only if that court has a real connection to the dispute, such as the defendant's domicile, the place of performance or the place of signing (Civil Procedure Law art. 35). If it says nothing, the claim goes to the court where the supplier is domiciled or where the contract was performed (art. 24).
Our view for a typical buyer's claim against a factory in mainland China: the court where the factory sits is usually the cheaper route, and asking that court to freeze assets is straightforward. Arbitration is confidential and the award is final, which suits larger contracts and buyers who want to keep the relationship quiet. A clause pointing to a court in your own country is the weakest position, because a foreign judgment still has to be recognized before it reaches assets in China. Our article Suing a Chinese Company in a Chinese Court walks through filing, service and timing.
How long do I have to bring a claim?
Four years for a claim under an international sale of goods contract (Civil Code art. 594), counted from when you knew or should have known of the loss and who caused it. Most other civil claims have three years (art. 188). If you bought through a company in mainland China rather than directly from abroad, assume three years until we have looked at the contract.
The period restarts when you make a written demand on the supplier, when the supplier agrees to perform, or when you file a claim (art. 195). Keep proof that each demand reached the supplier: an email to the address in the contract, a courier receipt, a chat message the supplier answered. A dispute that has drifted for a year is not yet lost, but the evidence of what was said and when becomes the case.
Freezing the supplier's money before it moves
A judgment is worth what you can collect. Chinese courts can freeze a defendant's bank accounts and seize property during a case (Civil Procedure Law art. 103), and in urgent situations before the case is filed (art. 104). For a pre-filing freeze the court must rule within 48 hours of accepting the application, the applicant must provide security, and the freeze is lifted if the claim is not filed in court or arbitration within 30 days. An applicant whose application turns out to be wrongful compensates the other side's loss (art. 108).
In practice many courts accept a guarantee from an insurance company as the security, which is far cheaper than depositing cash. A freeze often does more than the claim itself: suppliers that ignored letters for months tend to answer once an account used for wages is frozen. Our article How to Freeze a Chinese Company's Assets Before You Sue covers the application and its costs.
Who pays the lawyers if you win?
In a Chinese court, generally each side pays its own lawyers unless the contract says the breaching party bears the other side's enforcement costs, including lawyers' fees. Court fees are normally ordered against the losing party. That is why every manufacturing contract we draft includes a clause making the supplier liable for our client's reasonable enforcement costs, such as lawyers' fees, court or arbitration fees, preservation costs and notarization.
In arbitration, the tribunal can order the losing party to compensate the winner's reasonable costs of the case; under the CIETAC Arbitration Rules (2024) this is article 52, and tribunals look at the result, the complexity and the work actually done. You have to claim these costs expressly and prove them with invoices and payment records. We list them as a separate claim from the start.
Which documents decide a dispute with a Chinese supplier?
Usually two small sets of documents, and most buyers already hold them. The first set shows who you dealt with and who took the money: the contract or proforma invoice with the supplier's Chinese name and company chop, the purchase orders, and bank slips showing the payee. A trading company that took the payment and a factory that made the goods may both be liable, but only if the paperwork connects them.
The second set shows what was promised and what arrived: the approved sample, ideally sealed and dated, the specification sheet, the inspection report, photographs, and your written notice of defects. Send that notice within the inspection period in the contract, or promptly if none is agreed, because a late complaint can cost you the claim. Our article When Production Doesn't Match the Golden Sample explains why the sealed sample matters so much in court.
Running the case from abroad
A foreign company can usually run the whole case without travelling. The company signs a power of attorney abroad, has it notarized and apostilled or legalized, and sends it with its corporate documents. Evidence in English is translated into Chinese. Hearings are attended by your lawyers, and courts increasingly hold procedural steps online. You receive each filing, each court notice and our recommendation at every decision point in writing.
When we tell you not to sue
Not every dispute is worth proceedings. Translation, notarization, court fees (estimate them with our calculator) and time all count, and many disputes between small sellers and suppliers involve sums that do not justify a full case. When that is so, we say it in the assessment and recommend something cheaper: a demand letter, a negotiated settlement, a partial refund against a credit on the next order, or recovering your tooling and moving to another factory. We do not promise outcomes, and we would rather lose a fee than run a case that cannot reach the supplier's money.
Questions buyers ask about disputes with Chinese suppliers
- Can I sue a Chinese supplier from abroad without travelling to China? Usually yes. You sign a power of attorney abroad, have it notarized and apostilled or legalized, and the case is run by lawyers in China. Evidence in English needs a Chinese translation.
- Is a demand letter worth sending before suing? Often, if it is specific: the amount, the contract terms breached, a deadline and what happens next. A written demand that reaches the supplier also restarts the limitation period (Civil Code art. 195). It is a weak tool against a supplier that has already disappeared, which is why we assess first.
- My contract says disputes go to a court in my own country. Can I still claim in China? Possibly, but a foreign judgment can be hard to enforce against assets in mainland China. We look at whether a Chinese court can hear the claim and which route reaches the supplier's money faster, and put the answer in the assessment.
- What does the dispute assessment cost and include? USD 590 for one supplier and one order, fixed and confirmed in writing before we start. It covers up to 30 pages of contract, payment records and correspondence, the forum and time limit, the supplier's registration and enforcement record, and a written recommendation within 5 business days.
Law referred to on this page
- Civil Code of the PRC (effective 1 January 2021), arts. 188, 195 and 594: gongbao.court.gov.cn
- Civil Procedure Law of the PRC (2023 amendment, effective 1 January 2024), arts. 24, 35, 103, 104 and 108: gongbao.court.gov.cn
- CIETAC Arbitration Rules (2024), art. 52: cietac.org
Translations and summaries are ours and unofficial. This page is general information on mainland China law as of 10 November 2026, not legal advice.
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