The Essential Answers on Signing Contracts with Chinese Companies
Yesterday, in The Essential Checklist for Signing Contracts with Chinese Companies, I wrote about what our China lawyers typically advise our clients regarding the signing of contracts with Chinese companies. Today, a client sent us what they call their Standard Operating Procedures (SOP) for signing Chinese agreements, and asked us to review each item for accuracy.
For ease of reading, I have converted their SOPs into a series of questions below, followed by our responses analyzing whether their procedures align with Chinese legal requirements and best practices.
By the end of this blog post, you will have a better understanding of the key considerations for signing contracts with Chinese companies.
1. Digital vs. Wet Signatures
Client’s Question: Is it true that we should not use digital signatures like DocuSign to sign Chinese agreements because they might not be valid in China? Should we only use wet signatures?
Our Response: Chinese law generally does not recognize foreign digital signature services like DocuSign. Only electronic signatures from government-approved providers are legally valid. While electronic signatures can have the same legal effect as wet signatures under Chinese law, wet signatures remain the safest option for enforcement.
China’s Electronic Signature Law (2019) allows electronic signatures, but in practice, companies often require a “paging seal” for authenticity. Courts have upheld contracts signed via DocuSign in some cases (e.g., 2019 Su 0591 Minchu 682), but relying on foreign digital signatures carries risk. To mitigate this, contracts can explicitly state that both parties agree to electronic execution.
Therefore, for all but the smallest transactions, we generally recommend using a wet signature to ensure enforceability and avoid legal uncertainties.
2. Mixing Wet and Digital Signatures
Client’s Question: Should we avoid combining wet and digital signatures on the same document because it could create confusion or legal issues? Should Chinese agreements only be signed with wet signatures?
Our Response: Yes, combining wet and digital signatures can create validity and enforcement risks in China. Courts and government agencies may question the authenticity of an agreement if it contains mixed signature formats. To avoid potential challenges, it is best to use only wet signatures for Chinese contracts.
3. Signing Every Page
Client’s Question: Should all parties sign every page of the agreement?
Our Response: While Chinese law does not require this, signing each page can help prevent disputes over altered or missing pages. This is particularly useful for high-value or complex contracts, where ensuring that no pages are replaced or modified is critical.
4. Use of Company Chop and Personal Chop
Client’s Question: Does the authorized representative need to use both their personal chop and the company chop when signing a contract?
Our Response: The company chop (公章, gōngzhāng) is essential for any legally binding business contract in China and is the primary way companies formalize agreements. A personal chop is not typically required unless specified in the contract or in certain government-related transactions. If an individual, rather than a company, is signing, their personal chop may be required for validity.
5. Regular Signature vs. Chop Only
Client’s Question: Does the authorized representative also need to sign with a handwritten signature, or is the company chop sufficient?
Our Response: The company chop is the most important element for contract validity in China. However, adding a handwritten signature alongside the chop can provide additional clarity and confirmation of authorization. While not legally required in most cases, a signature in addition to the chop is a best practice and can help avoid disputes over authorization.
6. Sending Signed Copies for Execution
Client’s Question: For logistical purposes, should we send two signed copies to the other party and require that they return one signed copy to us?
Our Response: Yes, this is a standard and recommended practice. Each party should retain a fully executed original copy for record-keeping and enforcement purposes. This helps avoid disputes over authenticity and ensures that both sides have identical, legally binding documents.
7. Approval Before Sending Hard Copy
Client’s Question: Should we ask the other party to send a color scan of the signed document before they mail the hard copy, so we can review it first?
Our Response: Yes, requesting a color scan before the hard copy is sent is a good safeguard. This allows for verification that the correct signatures and chops were used, that no pages are missing or altered, and that the agreement was executed correctly. This step can prevent costly execution errors and delays.
8. Date Differences Between Signatures
Client’s Question: Does it matter if the signatures on the contract are dated weeks apart, depending on when we sign versus when they receive and sign the document?
Our Response: In China, the effective date of an agreement is usually the date stated in the contract, not necessarily the signing date. However, if no effective date is specified, large gaps between signing dates may create uncertainty about when the agreement became binding. To avoid confusion, contracts should always include a clear “Effective Date” clause specifying when the terms take effect.
9. Sending Three Signed Copies Instead of Two
Client’s Question: Would it be okay to send three signed copies so that we can retain two, or would that cause any issues?
Our Response: There is no legal issue with sending three signed copies. If you need an extra signed original for internal record-keeping, you can send three copies, provided the other party agrees. This can be useful in situations where multiple parties need access to an original contract for compliance or regulatory purposes.
10. Signing in Red Ink
Client’s Question: We heard that Chinese agreements should be signed in red ink because it makes them more official or impactful. Is this true, and should we follow this practice?
Our Response: No, this is a misconception. Chinese contracts are usually signed in blue or black ink. Red ink is typically reserved for official chops and seals, not for handwritten signatures. Using red ink for a signature is neither required nor particularly common and may even be perceived as unusual or informal. Stick to blue or black ink for signatures and use a red chop for stamping.
11. Paper Type for Agreements
Client’s Question: Is it true that we do not need to use special paper for Chinese agreements and that regular office paper is acceptable?
Our Response: Yes, regular office paper is sufficient for contracts in China. There is no requirement for special paper unless specified in the agreement (such as government-related contracts or notarized documents). Using standard office paper is both practical and legally sound.
Final Takeaways
Signing contracts with Chinese companies requires careful attention to legal and procedural details to ensure enforceability. The items in this SOP highlight common concerns businesses have when finalizing agreements in China.
Do you have additional questions or need assistance with contract drafting, review, or execution? Contact our team for guidance.
