China partnerships & manufacturing; reference -

Latest comment from China Law Blog on the dangers of China supply

“here’s the thing; huge swaths of other manufacturing industries in China have become rife with blatant rip offs as well (as PPE). Having your product made in China — whatever the product — has never been riskier.

“Ordering and paying for something from China and then getting nothing in return or something not at all like what you ordered is happening left and right these days and yet many companies are oblivious to this.These fraudsters are smart and there are good reasons why they spend the money to send you something instead of nothing at all and why they at first claim they will remedy the problems and why they so often continue to make that claim. The reasons are usually two-fold.

One, sending even really bad product is less likely to lead to criminal charges than sending no product at all. If the police come by the Chinese fraudster can say, “I sent them the product they ordered. It’s not my fault those Americans/Europeans/ Australians are so picky.”
Two, by stalling they can keep their scam alive for much longer. They’ve paid for advertising and for a website and they’ve even bought the really bad product (be it spoiled fish, baking powder or bottom of the line window awnings) and they want to maximize these expenditures.

Whenever China manufacturing sees a big decline in their demand — as is happening right now — YOUR risks of getting nothing or getting junk instead of what you ordered goes way up. China’s manufacturing industry is hurting

I have been following the China Law Blog for two years.

It gives a great insight into China law and attitudes towards law in manufacturing.

Here are recent articles by and about China Law Blog related to sourcing PPE from China and the trials and tribulations

For some of what we have written on sourcing PPE from China, we encourage you to check out the following:

And for more on what we have to say about the risks of buying PPE, please check out the following news articles as well:

Wall Street Journal: Faulty N95 Masks Hamper Hospitals on Coronavirus Front Line
Los Angeles Times: Faulty masks. Flawed tests. China’s quality control problem in leading global COVID-19 Fight.
South China Morning Post: Inside China’s “Wild West”, where mask machines are like cash printers
Wired Magazine: Everybody and His Dog Is Trying to Sell Medical Equipment
Japan Times: Politics aside, U.S. relies on China supplies to fight coronavirus
Los Angeles Times: States battle for coronavirus supplies in a chaotic market

Heres their advice for newbie China businesses…

Much of the time, the big frauds are committed by a non-existent company or by a company that is in dire financial straits. Let’s face it, thriving Chinese companies don’t need to steal people’s money and they almost never do. So at the very minimum, you should make sure that the company to which you will be sending the money is actually registered as a company in China and licensed to make and sell the products you plan to buy from it.

How can you reduce your chances of your new or existing China product supplier taking advantage of you? The following will help. A lot.

Be careful when establishing business relationships with a new company. Do as much due diligence as you can. Send people you trust to do a site investigation of the manufacturing site. Do a site inspection on goods before payment. Make sure the company exists and is legally able to conduct the business for which you will be paying it. Make sure that it is doing at least okay financially. We do this sort of due diligence work all the time for our clients and in the last few months, nearly 40 percent of the time we have recommended they seek out another supplier.
Use a contract that actually works for China and that sets forth clearly what you are buying and what happens if your China supplier fails to comply. See China Contracts: Make Them Enforceable Or Don’t Bother and China Contracts that Work.
Know the market price of whatever it is you are seeking to purchase before you purchase it. Do not trust a company that gives you an unreasonably low price quote. That company likely will either steal your IP or never send you what you ordered or both.
Consider a small trial order to reduce your risk. The problem with this though is that many scammers will provide you with a good trial and then scam you when you order the full amount. But if you combine this with a contract that works for China and proof that the company actually exists and is operating legally, you will be lowering your risks.

Please consult appropriately skilled professionals before considering working with Chinese companies.