Contracts that hold and IP that stays yours

Making a Chinese contract enforceable 合同效力要点

Chinese contract law (the Civil Code's contract part) is closer to what a civil-law practitioner expects than the horror stories suggest: written contracts are enforceable, damages follow breach, and courts routinely rule for foreign parties with good paper. The failures we see are almost always preventable at signing:

• Wrong party. Contract with the registered legal entity whose name appears on the business licence — not a trading name, a group brand, or an affiliate with no assets. Pull the counterparty's registration record first (a five-minute check).
• No chop, wrong chop. The company chop is the standard mark of corporate assent. Insist on the registered company seal (and the legal representative's signature for belt-and-braces); photograph what was applied at signing.
• Vague price and acceptance terms. Quality-acceptance criteria, inspection windows and payment triggers drafted loosely become the dispute. Chinese courts enforce what is written; write what you mean.
• Governing law and forum by default. For genuinely foreign-related contracts you may choose foreign law and offshore arbitration; for domestic contracts you cannot. Either way, an arbitration clause must name a specific institution to be valid — "arbitration in Shanghai" without an institution risks invalidity.

Deep-dive Chinese-language resources: our Contracts desk covers drafting and breach remedies clause by clause.

Trademarks: file before the market knows your name 商标先申请

China's trademark system is first-to-file with no general use requirement for registration — which produced a professional squatting industry aimed precisely at foreign brands entering the market. The defence is cheap and procedural: file early (before distribution talks, before exhibitions, before this website's advice reaches you late), file broadly enough (core classes plus retail/e-commerce classes where infringement actually happens), and file the Chinese name — a transliteration or meaning-based mark chosen by you, because if consumers coin one it will be registered by someone else. Recovering a squatted mark through opposition or invalidation (bad-faith filing without intent to use is a statutory ground) is possible but slower and costlier than filing first. Our IP desk (Chinese) maintains the full case library.

Patents and trade secrets 专利与商业秘密

China grants invention patents (substantive examination, 20-year term), utility models (registration-based, 10 years — fast, cheap, and underused by foreign filers) and design patents (15 years). Domestic filing volume means your competitors are filing; freedom-to-operate checks before launching a product line are not paranoia. Employee inventions belong to the employer when made on the job, but say so in the employment contract anyway and regulate inventor remuneration.

Trade secrets are protected under the Anti-Unfair Competition Law, but only for information whose owner took reasonable confidentiality measures — the litigation regularly turns on whether you can prove access controls, NDAs, marked documents and need-to-know distribution. For technology brought into China by licence, check the technology import-export framework (freely importable, restricted or prohibited categories) and register licence agreements where required for royalty remittance — the payment side is covered in Profit Repatriation.

A word on enforcement 维权路径

IP enforcement in China runs on three parallel tracks — civil litigation (specialised IP courts in major cities, with damages awards rising under the punitive-damages provisions), administrative complaints (fast takedowns through market-regulation authorities), and e-commerce platform mechanisms (notice-and-takedown against infringing listings). Which track, or which combination, depends on what you need: money, speed, or a cleaned-up marketplace. That strategic choice — and the evidence preservation that must precede it (notarised purchases, timestamped captures) — is where early legal input pays for itself. For dispute mechanics generally, continue to Dispute Resolution.