Bilingual Contract Templates & Customization

Most people realize the importance of having bilingual contracts when doing business in Asia. But you may have questions about jurisdiction, penalty clauses, official language of the document, use of “chops” and such.

The team at AsiaBridge Law specializes in structuring effective (and affordable!) bilingual contracts that protect our clients’ interests yet respect their business partners in China & Asia.

Bilingual Contracts

Templates for Bilingual Contracts

Here are some of our most requested contract templates:

Bilingual Purchase Order (PO) Template:  PO is a fairly simple, but very important document. Usually 1 page covering who is buying what, when, under which payment terms.

Bilingual Purchase Contract (PC) Template: The PC supports the PO by defining the expectations of the buyer in terms of the general relationship with the seller. This may include codes of conduct, quality terms, warranty, tooling/mold issue and more.  The PC is sometimes referred to as a “Purchase Agreement”, “OEM Agreement” or “Supplier Contract”.

Bilingual NNN Template: Non-Disclosure Non-Usage Non-Compete Agreement (NNN)

Bilingual Employment Contract (EC) Template

Bilingual Distributorship Agreements (DA) Template

Many other contract templates are available upon request.

How to Order a Bilingual Contract Template?

Bilingual contract templates are purchased by the client in conjunction with a block “General Counsel” (GC) time. The GC is used to customize and translate the given bilingual templates based on the exact needs of the client. The templates are not available for purchase as stand alone items. A 10 hour block of GC is recommended for standard projects but a 4 hour block may be sufficient for small projects. Download the rate sheet via the “contact us” page for details.

I don’t speak Chinese, how do I know if the contract includes the terms I want?

The paralegals and lawyers will start with a contract template then customize it according to the specific needs of the client.  The client will have a chance to review the English version before conversion into the bilingual contract. As the translation in the bilingual version is done sentence by sentence (rather than page by page), it will be quite easy for the client to confirm that all of their key concerns have been covered.

Do Contracts Mean Anything in China?

Let’s have one of our Chinese lawyers answer this important question, in her own words:

If something goes wrong, some clients doubt a good contract will protect them. I often hear comments like: ‘The Chinese legal system is slated against foreigners.”

 

I agree that China’s legal system is far from perfect and actually a Chinese person could feel just as confused as any foreigner when dealing with all these changing laws and regulations, although foreigners do face the cultural difference and language barrier.

 

First off, a well-prepared contract gives out the signal: I care. Other people will think before acting against you.

 

Second, a good contract provides remedy if anything should go wrong.

 

In my opinion, doing business without a good contract is akin to parking your car in public with a broken window and your wallet on the seat.

Do I need a Bilingual Contract?

An English-only document signed by both parties is legally binding. But it is bad idea! Here is why, as explained by AsiaBridge Law’s advisory board member- Mike, from the US.

First, to have any legal validity in China, you have to list the Chinese name. I’m talking about the Chinese name you see on their Chinese business license. Local authorities and courts only recognize registered Chinese names. So the English name, or whatever they call themselves for marketing, is not an official name. You can’t sue some company named “Best Good Star Mfg.” But you can sue “最好星有限公司”!

Keep in mind that to litigate outside of China is for the most part meaningless. The vast majority of Chinese companies do not have any assets outside of China and a court in China does not enforce foreign judgments, so it means that you actually get nothing (except a bill for wasted legal fees) even if you prevail in a court back home. So if litigation is the only option to solve the dispute, a lawsuit should be filed in a Chinese court.

If your key documents are in English, it complicates things a lot. For example, before the courts can make a decision, the English documents/ supporting evidence will need to be translated into Chinese by a court approved translator for the court’s review. This can be expensive and very time consuming. Plus the defense can employ a stall tactic of fighting over the wording of the translation itself. It’s much better to have your attorney structure the wording in advance in Chinese rather than hope the court’s translation will be accurate. Be safe. Use bilingual contracts.

I have an existing contract template that I use back home. Can I hire a lawyer in China to adjust it for use in China?

You can certainly hire AsiaBridge Law to customize your existing templates. Once a block of General Counsel time is booked, the hours are yours to assign as you wish. However, it may actually be better and more affordable for you to purchase the AsiaBridge Law templates for the following reasons:

  1. It’s quite dangerous to simply translate an English only doc from back home and hope it protects you in China.
  2. AsiaBridge Law contract templates have a proven track record.
  3. The lawyers in our network are familiar with the AsiaBridge Law templates so it is easier for them to make adjustments. If they are working from an outside template, they may need to spend time getting up to speed on your template, and that could waste time and costs. This point is especially true if your existing contract is not already bilingual.

However, if your existing document is bilingual, then perhaps there is no need to buy the AsiaBridge Law contract templates and you can simply engage AsiaBridge Law’s General Counsel services to customize your existing template and confirm it is suitable for China.

I want to use my bilingual contract over and over again with multiple suppliers, but I don’t speak Chinese. How do I update the Chinese parts of my bilingual contracts when I have new orders to place?

As part of our service, a lawyer will be assigned to your project for an agreed block of time to customize your contracts. As long as you have time remaining in the block, the lawyer is available to update and revise your documents.

Here are some options if you have used up the agreed block of time:

As the translation is done sentence by sentence rather than page by page, the bilingual contract is provided to you in a format that you can edit on your own if needed. Assuming your core business doesn’t change and you are using the same terms & conditions for multiple suppliers, you can cut out the Chinese name of the previous supplier and insert the Chinese name of the new supplier.

But if your products change or you have negotiated new terms, you should consider re-engaging our lawyers under a new block of time.  But as you have already paid for the template when you initially hired AsiaBridge Law, you would not need to re-purchase the template again just to have updates made.

I don’t speak Chinese, how do I know that the Chinese company’s real name (in Chinese) is on the contract?

Once you know the official name of the Chinese party, our lawyers can easily insert it into the contracts for you. As part of our service, when we send you the final draft of the contract, we also provide a list of tips to help you make sure you are signing the contract with the right party. For example, it is very important to have an official name/ corporate chop on the contract and that this name matches public records and corporate bank accounts.

Important:  A great contract with a fake company doesn’t protect you!  If you don’t know the official Chinese name of the company or you are unsure about the company’s reputation and fairness, the following services are recommended:

Corporate Assessment (CA): Ownership, Stability, Reputation & Assets of a Chinese company

Red Flag Assessment (RFA): Risk, Scams & Fraud in a given transaction

How is a NNN different from a NDA?

NNN stands for “Non-disclosure, Non-compete, Non-circumvention” and is a more robust version of the traditional NDA (Non-disclosure agreement)”.  Simply put, the NDA is a promise that “they won’t tell anybody outside their organization about the idea”.  The NNN adds more layers of protection because it makes them promise to not only keep it a secret but also not develop the idea in house.  So technically, under an NDA, a company could copy your idea, make the product in-house and sell it to your competition as long as they did it inside their organization rather than telling somebody outside about it.  For those reasons an NNN is better than the NDA as the NNN specifically addresses not only secrecy but also non-compete and non-circumvention.

Most professional lawyers dealing with China have moved from the NDA to the NNN in the past decade.  The NNN contracts provided by AsiaBridgeLaw are well-written and suppliers who have used an NDA in the past will have no problem accepting the terms of the NNN as well.  And if a supplier fights the terms of the NNN, that’s a big red flag that they may have a hidden agenda.

China Contracts: Resources & Tutorials

In conjunction with the China Sourcing Academy, members of the AsiaBridge Law advisory board have created a series of short video tutorials.  These videos are open to the public and hosted on our YouTube Channel.

Topics covered:

  • Inside look at the courts- An American in China
  • Domestic vs International Contracts
  • Getting the supplier to give a $%#@
  • Contract Essentials
  • Jurisdiction
  • Chop vs Signature
  • How to find a good lawyer in China
  • Penalty Clauses
  • Official language & so-called verified suppliers
  • Liability & Compliance

Bilingual Contracts with AsiaBridge Law

Are you interested in working with AsiaBridge Law? If you’re ready to get started and have a conversation, click here to contact us and get our rate sheet.

Ready to Contact AsiaBridge Law?

If you’re ready to get started with AsiaBridge Law or would like more information, please click here to go to our contact page and fill out our short form.