Chinese Mold Recovery Self-Check: 11 Questions

Make a mold list. The factory, or a court, has to know which molds are yours. List each one with a reference number, the cavity count and the part it makes. Match the list to your drawings and payments. See what a mold dispute depends on.

Get photos and markings. Molds often look like other molds in the same workshop. Photos taken when you accepted them help show which ones are yours. So do markings that survive handling.

Match payments to molds. A single lump sum is hard to link to particular molds. Gather every invoice and payment for the tooling. A separate mold line on the proforma invoice (the invoice a seller issues before you pay) helps. See who owns the mold when the factory designed the product.

Check the buyer's name. Say a related company or an old company paid for the molds. Then the company asking for them now may need a written transfer or authorisation first.

Check what the contract says about ownership. If it says nothing, the payment record and the general rules of law decide. In my view, molds made to order and fully paid for by the customer belong to the customer, unless something in writing says otherwise.

Check whether the factory can keep the molds. The law calls this a right of retention. A factory that made work to your order can keep the finished work if its fee or materials are unpaid. That is the rule unless the contract says otherwise (Civil Code art. 783). Between businesses, the debt doesn't have to relate to the molds (art. 448). If a clause in the contract excludes this right, most of the argument never starts (art. 449).

Deal with what is unpaid. A factory holding molds over an unpaid invoice may be using a right the law gives it. Before you send a demand, work out what is owed and whether it relates to the molds.

Find out who holds the molds. They may be at a company you never signed with. Your contract gives you rights against the company you signed with. It doesn't give you a direct claim against the holder (see Civil Code art. 772 on work handed to a third party). Before you send any demand, find out which company holds them and on what basis.

Keep the factory's exact words. Its reason shapes the next step. The reason may be an unpaid amount or a term about handover. Any review has to answer the factory's side as well as your demand.

Decide the outcome first. Each outcome needs different steps. A demand letter sent before you choose tends to make the factory less willing to move. Getting molds back and being paid for them take different routes.

Protect the designs too. If the factory has technical information it shouldn't use elsewhere, the molds and the confidentiality question are usually handled together. See China NNN agreements and 48-hour incident support.