Lead lawyer: Adrian Liu · PRC lawyer, licensed since 2021 · Xiamen · 74 supplier-dispute lawsuits · Licence 13502202110350464 · How to verify · Reviewed
A purchase contract is for buying what a Chinese supplier already makes. That means a catalogue product or a standard machine, changed only in colour, packaging or label. It sets out what you are buying, how you pay, when the goods ship and how you check them. The contract also says what happens if they fail, and where disputes go. I draft it for overseas buyers in English and Chinese, with the Chinese text controlling.
From USD 1,950bilingual purchase contract, one supplier
3–5 business daystypical drafting time
Each further supplier costs USD 950, or USD 200 if only the supplier's details change. Scope and fee are confirmed in writing before paid work begins.
Before you pay a deposit or sign the proforma invoice. The contract then sets the terms the payment is made under. Send the quotation or proforma invoice as soon as you have one.
Which terms do Chinese sellers try to change?
I look first at payment, acceptance, delivery and liability. Sellers usually want three things. They want to be paid earlier, to have acceptance settled quickly and to answer for less.
Payment and deductions. Sellers may raise the deposit, ask for the balance before shipment, and limit your right to deduct or set off. Tie each payment to a step you can check, such as production, inspection or documents. Say which part of a payment you may hold back in a dispute, and what happens next.
Acceptance, objection periods and warranty. Sellers may make the factory inspection final, or give you a very short period after arrival to raise every quality problem. Keep quantity and appearance checks, performance tests and hidden defects apart. Then say when the warranty starts, how notice is given, and how repair and retesting work.
Delivery and transport risk. Sellers may change "arrives on time" to "ships on time", or move the risk of damage in transit to you earlier. Name the trade term, the exact place and the Incoterms edition. Deal with ownership, transport risk and quality liability one by one. One trade term doesn't settle all three.
Liability caps and downstream losses. Sellers may cap liability at the order value and exclude lost profit, recall costs and similar losses. Decide loss by loss who bears it, how it is proved and when the cap doesn't apply. One line making the seller liable for "all losses" leaves those questions open.
How do you tie a test report to the goods?
Quality disputes often turn on the link between a test report and the goods. A report that says "fail" still has to answer five questions. Which batch was tested? Who took the sample? Was it sealed? How was it handled on the way? Do the test method and criteria match the contract? Put the quality standard, the acceptance steps and the rules for keeping evidence into the contract, so the three fit together.
Open the part that matches your question. Each section is complete on its own.
What does the purchase contract cover?
Goods, payment, delivery, inspection, warranty and disputes.
The goods: model, specification, quantity, and the approved sample or catalogue page they must match.
Price and payment terms, and which company receives the money.
Delivery: the date, the trade term and when risk passes to you.
Inspection: how you check the goods, and the period for raising problems.
The quality warranty, and when the supplier must repair, replace or refund.
What each side owes if it breaks the contract.
Disputes: a Chinese court or arbitration, chosen with the supplier's assets in mind.
What isn't included?
Tooling, quality agreements, negotiation and redlines.
Marking up the supplier's own contract clause by clause. That is a contract review, which starts at USD 850.
What you receive
A bilingual purchase contract for one supplier, with the Chinese text controlling.
One round of changes. Send all your comments together.
Signing guidance: which company signs, and with which company seal (chop).
A check of the signed copy against the agreed text, at no extra charge.
Selected matters
These examples are based on matters I have handled. Names, products, places, dates, amounts and other identifying details have been removed or changed. They show the kind of work involved. They don't promise any result.
Acting for a buyer
Standard machines, balance paid only after the factory test.
An overseas buyer was buying standard-model production machines from a Chinese manufacturer, to supply its own customer. I drafted the purchase contract and negotiated it. The seller's authorised signatory signed it, and the seller's company seal is on the signing page. The contract included these terms.
The seller warranted that it is the actual manufacturer and is not acting as a trader.
Payment goes only to a company account in the seller's registered name. A change of account needs the company seal, and the buyer must verify it.
The balance is paid only after the buyer confirms in writing that the factory acceptance test (FAT) has passed. Silence, or getting ready to ship, does not count as passing.
If the machines fail the test, the seller may fix and retest them twice. If they still fail, the buyer may refuse them and ask for a refund.
After delivery there is a second acceptance test on site. The contract also has a performance guarantee, a warranty, and delivery of the operating documents and passwords.
The seller may not go around the buyer to contact its customer, or subcontract core parts without consent.
The Chinese text controls. Chinese law applies, the CISG (the UN convention on international sales) is excluded, and disputes go to arbitration in mainland China.
Signing needs the company seal. A sales seal or contract seal doesn't count.
The seller found the liquidated damages (sums agreed in advance for a breach) and the test terms too heavy, and we negotiated. The signed version kept the terms that mattered most to the buyer. The balance waits until the test passes, and two failed retests allow a refund.
Adrian Liu (Xiaoyu Liu · 刘效宇) is a PRC-licensed lawyer based in Xiamen. He has worked on more than 200 commercial agreements. His court work includes 74 supplier-dispute lawsuits and 136 trademark lawsuits. He checks each contract against Chinese law, Chinese court rulings and his own cases. Licence no. 13502202110350464.
What you are buying: model, quantity and unit price. Send the proforma invoice or quotation if you have one.
What you have agreed on payment and delivery.
After a conflict check, I confirm the scope and the fee in writing.
Questions from overseas buyers
I'm buying a machine from a Chinese manufacturer. Do I need a lawyer for the purchase contract?
If the machine matters to your business, a written contract is worth having. A proforma invoice usually fixes the model, price and quantity. It rarely sets how the machine is tested on site, what the warranty covers or where disputes go. A purchase contract from me starts at USD 1,950.
Is a proforma invoice enough when buying from a Chinese supplier?
For a small, simple order it may be. It records what you are buying and the price. See when a PI becomes a binding contract. Check what it says about inspection, defects, delivery dates and disputes. If it says nothing, Chinese law fills the gaps with default rules, which rarely match what an overseas buyer expects. If the product is made to your design, a manufacturing agreement fits better.
The machine passed inspection in China but failed after installation. What can I do?
Check the contract first. If it sets a separate acceptance test on site, signing off at the factory doesn't give up your rights under the site test. If it sets an inspection period, tell the supplier in writing within that period. If it sets none, tell the supplier within a reasonable time after you find the problem. The outer limit is two years from receiving the machine, unless a quality guarantee period applies (Civil Code art. 621). Keep the machine, the test records and the messages.
How is a purchase contract different from a manufacturing agreement?
A manufacturing agreement is for goods made to your design, drawings or tooling, or a product still being developed. It also deals with tooling ownership, surplus production and design changes. A purchase contract is for what the supplier already makes. It starts at USD 1,950; a manufacturing agreement starts at USD 3,950.
English or Chinese. Tell me what you are buying, from which supplier, and whether you have a proforma invoice or quotation. A short, non-confidential summary is enough to start. I'll tell you where you stand and what your options are.
