We offer comprehensive legal support to companies manufacturing overseas.
Contact UsHarris Sliwoski's international manufacturing lawyers help companies get their products made overseas on terms they can enforce. Many of the manufacturing disputes we handle trace back to decisions made before production began. The buyer signed with a trading company instead of the factory, never registered its brand where the factory is located, paid for molds without settling who owned them, or relied on an American-style contract that does not work in the factory's courts. Our due diligence and contracts address these risks before the buyer sends money or valuable information to a factory. When a manufacturing relationship breaks down, we help clients recover deposits, pursue claims for defective goods, protect their designs, and recover molds and other equipment. We also defend buyers against claims brought by Chinese suppliers and Sinosure, China's state-owned export credit insurer.
We have drafted International NNN Agreements since 2003 and have drafted thousands of them. Each year we also draft more than 100 cross-border manufacturing agreements, most for a flat fee quoted before we start. Our international manufacturing practice is led by Arlo Kipfer, who spent nearly two decades living in China, including running an international company's China operations before becoming a lawyer.
China remains the center of our manufacturing practice, but our clients also manufacture in Vietnam, India, Mexico, Guatemala, Colombia, Peru, Taiwan, South Korea, and elsewhere, often in several countries at once. They range from startups placing their first order to Fortune 100 companies with factories on several continents, and they make everything from children's toys and furniture to trailers, electronics, industrial equipment, and specialized components. We have also represented artists having their sculptures fabricated overseas. Many of our international manufacturing clients are based outside the United States, particularly in Europe, Canada, Australia, and New Zealand. Our lawyers work in English, Chinese, Spanish, and Portuguese.
One of the most expensive mistakes we see is a company entering a manufacturing relationship without knowing who is on the other side. A supplier presents itself as a factory, but the contract is with a trading company, the payments go to another entity, and the molds sit at a mainland factory that has signed nothing. A contract with a Hong Kong trading company generally gives you no direct contractual claim against the mainland factory making your goods, and a judgment against a company with no assets recovers nothing. We have seen companies lose substantial amounts because a supposed manufacturer was actually a sourcing agent with little more than an office and a website. Our article on sourcing agent fraud and deception describes real cases involving undisclosed intermediaries, inflated pricing, and factories that turned out to be someone else's.
Our foreign company due diligence work examines prospective manufacturers in China and elsewhere. For Chinese companies, it often begins with our Company Reputational Report, which draws on corporate and litigation records to identify ownership, registered business activities, lawsuits, sanctions, and other warning signs. Before drafting a contract, we confirm the company's exact registered Chinese name and address, whether it is a mainland or Hong Kong company, and whether the company receiving payments is the one bound by the agreement. When a trading company stands between our client and the factory, we usually recommend binding both. Our guide to overseas manufacturing due diligence explains why, and The Hong Kong Intermediary Trap addresses the particular danger of contracting with an offshore company that owns few reachable assets.
A supplier can be legitimate, financially troubled, and still delivering products when the buyer signs its contract. We examine available indications of financial distress, particularly when a client depends heavily on one manufacturer or plans to make substantial advance payments. We also look at what would happen if the factory stopped production, lost a critical supplier, or closed altogether. An enforceable contract provides limited practical protection when the manufacturer has no money, and the buyer cannot move its products elsewhere.
Corporate due diligence also does not establish whether a factory can reliably manufacture a particular product. We leave physical factory inspections and technical audits to independent quality control firms. For important manufacturing relationships, those inspections should extend beyond the initial factory visit to production capability, equipment, quality systems, and the supplier's ability to obtain the components it needs. Legal diligence and technical inspections answer different questions, and both matter.
Overseas manufacturing usually requires giving a factory valuable information, from designs and formulas to technical drawings, production methods, and customer information. Once a manufacturer has that information and knows how to make your product, controlling what it does next becomes much harder. The appropriate protections depend on the country, the product, and what the manufacturer will receive.
A trademark registered in the United States, Europe, or another home market does not, by itself, give you a trademark registration in the country where your products are made. China generally follows a first-to-file system, and manufacturers, sourcing agents, distributors, and unrelated trademark squatters regularly register foreign brands there. Whoever holds the Chinese registration for your brand can interfere with your manufacturing and may be able to use China's customs procedures to stop goods bearing your brand from leaving the country.
One Canadian coat manufacturer came to us after China Customs detained a major shipment because another company held the Chinese trademark registration. Our client had used its brand for years, but that did not solve the immediate problem of getting its products out of China. We ultimately negotiated a six-figure purchase of the Chinese trademark. Filing for that trademark before manufacturing began would have cost a fraction of the price. We discuss this case and the broader registration risks in our complete guide to China trademark registration.
We have handled the registration of more than 1,000 China trademarks. We file them in the client's name, never our own, and generally file directly with China's trademark office (rather than through the Madrid System) so we can address China's particular classification and subclass requirements from the outset. For many companies manufacturing in China but selling elsewhere, we begin with the English word mark in the most important class and subclasses. The products, potential expansion, and risk of trademark squatting determine whether additional registrations are justified. We also assess whether to register logos or Chinese-character marks rather than assuming every business needs them.
Our trademark work extends beyond initial registration to oppositions, cancellations, and disputes with parties that have registered a client's brand first. We also register China design patents and copyrights where appropriate, advise on trade secret protection, and work with patent counsel when a product requires utility patent protection. When a company moves production to Vietnam, India, Mexico, or another country, its intellectual property strategy must move with it because Chinese registrations generally do not establish rights elsewhere.
NNN stands for non-disclosure, non-use, and non-circumvention. A traditional NDA concentrates on confidentiality. In overseas manufacturing, a factory can keep your information secret while using your designs to make competing products or selling directly to your customers. Our NNN Agreements address those risks, along with unauthorized registration of the buyer's intellectual property. Our guide to China NNN Agreements explains how the three protections work and why an ordinary Western NDA generally does not provide the same protection in China and elsewhere.
Our China NNN Agreements are drafted in English and Chinese, with Chinese controlling, for enforcement under Chinese law in a Chinese court. We also draft NNN Agreements for manufacturing relationships in Vietnam and other countries, adapting the agreements to local legal requirements rather than translating a China contract and assuming it will work. Vietnam agreements are generally bilingual in English and Vietnamese. In India, particular care is required because Section 27 of the Indian Contract Act restricts contractual restraints of trade. An Indian confidentiality or non-use provision has to protect a legitimate interest without imposing an unenforceable restriction on the manufacturer's ordinary business.
Prospective factories can often be screened using general product information. Detailed drawings, formulas, customer information, and other valuable material should go only to serious candidates, after the appropriate agreement has been signed. When a client has several prospective manufacturers that need substantially similar NNN Agreements, the additional agreements generally cost considerably less than the first.
We also tell companies when they do not need an NNN Agreement. Roughly half the businesses that ask us for one are better served by something else, often a less expensive trademark registration. An NNN binds the company that signs it and does nothing to stop unrelated businesses from independently copying a product. That limitation matters particularly in apparel, where competitors can reproduce a design without ever receiving the original manufacturer's confidential information. We rarely recommend NNN Agreements as the primary protection for small clothing brands and often steer them toward trademark registration instead.
Many branded products custom-manufactured in China need both a trademark and contractual protection, for the reasons discussed in China NNN Agreement or Trademark Registration? Usually Both. Once a factory is selected, our manufacturing agreement generally carries forward the substantive NNN protections while preserving the appropriate rights and claims under the earlier agreement. Our article on China NNN Agreements versus Manufacturing Agreements explains how the two fit together.
Many projects begin with a concept, prototype, or rough design that a factory must turn into something it can mass-produce. During development, the factory creates engineering improvements, technical drawings, production files, or new components that the buyer will need if it ever moves production. Unless ownership and usage rights are settled in advance, the buyer can end up paying to develop a product it cannot manufacture anywhere else.
We have represented buyers who paid for product development only to have the factory claim ownership of the finished design and refuse to release the files needed to manufacture it. The resulting problem is often more serious than a disagreement over intellectual property ownership. The buyer cannot complete development, obtain production-ready files, or hire another factory without paying for much of the work again.
Our product development agreements address ownership of new intellectual property, engineering improvements, prototypes, technical files, and test results. They also establish development milestones, approval procedures, payment terms, and what happens if development fails or the relationship ends. A buyer's right to receive and use the completed production files is especially important because ownership of intellectual property does little practical good if the factory controls the information needed to make the product. Our guide to China product development agreements discusses these problems and the contractual protections we use to address them.
Companies routinely pay for molds, dies, fixtures, and other production equipment, leave them at the factory, and assume they can take them back whenever they choose. Then the relationship deteriorates, and the factory refuses to return the tooling, demands more money, uses it to make products for others, or holds it as leverage in an unrelated dispute.
One company paid $200,000 to recover molds it had purchased for $80,000 only eight months earlier. The factory held five molds covering three product lines. Without a formal tooling agreement, the client had little practical leverage to recover equipment it already owned. The resulting production shutdown lasted two months and cost approximately $800,000 in lost revenue. We describe the matter in our guide to molds and tooling in international manufacturing.
Our tooling agreements establish ownership before a dispute arises. They identify the equipment, require appropriate ownership markings, restrict unauthorized use, and address maintenance, storage, inspection, and retrieval. They also govern what happens when production ends or moves to another factory. For complex or particularly valuable tooling, a standalone mold ownership agreement often provides better protection than a few provisions buried in a manufacturing agreement.
A manufacturing agreement should identify the company responsible for production, establish quality and delivery requirements that can be measured, and give the buyer practical remedies when the factory fails to meet them. The contract must reflect the particular manufacturing relationship. When an original equipment manufacturer (OEM) builds to the buyer's specifications, the agreement focuses on the buyer's designs, tooling, and production requirements. When an original design manufacturer (ODM) contributes its own engineering or technology, ownership and future use rights require closer attention.
Some clients need separate NNN, product development, manufacturing, and tooling agreements. Others can use one carefully structured agreement, provided it addresses the different obligations and remedies without creating conflicts. We explain the tradeoffs in China Manufacturing Contracts: When One Agreement Is Not Enough.
One American company contacted us after its Chinese factory announced an immediate 34 percent price increase on every future order. The factory controlled the buyer's molds and designs and had access to customer information that should never have been exposed. Two years earlier, the buyer had signed a single agreement blending tooling, confidentiality, and manufacturing provisions without clearly establishing the remedies for each type of breach. By the time the factory demanded the increase, changing suppliers was difficult and expensive. We addressed the client's options, but the dispute illustrated how much bargaining power a buyer can lose when its contracts fail to account for the factory's control over the production process.
A promise of "good quality" means little when an entire shipment arrives defective. We define acceptable quality through specifications, approved samples, and measurable testing requirements so the buyer can establish whether the factory breached its obligations. The agreement should restrict unauthorized changes in materials, components, or production methods and address subcontracting, production locations, and quality failures.
The bill of materials deserves particular attention. It should identify the components and materials the factory is required to use and establish when substitutions are permitted. We have seen manufacturers replace specified components with cheaper alternatives, leaving buyers with defective products and little recourse because the contract never clearly prohibited the substitution. Our article on why international manufacturing agreements need a good bill of materials explains how these omissions lead to expensive disputes.
Inspection rights must also work in practice. The contract should establish when inspections occur, who performs them, how defects are measured, and what happens when goods fail. Some defects are not apparent until installation or months of use, so acceptance and warranty provisions must account for problems that a pre-shipment inspection cannot reveal. Our article on China factory warranties explains why inspection, payment, and warranty obligations must be considered together.
A buyer that pays in full before satisfactory inspection has surrendered much of its bargaining power. We structure deposits, milestone payments, inspection conditions, and payment holdbacks around the product and the commercial relationship. Delivery deadlines, production forecasts, component lead times, and price-increase provisions also require attention, particularly when the factory knows the buyer cannot quickly move production. Many of these commercial matters are worth settling before drafting the full agreement, as discussed in our article on international manufacturing term sheets.
A contract borrowed from a domestic American or European transaction often relies on remedies that are difficult or uneconomical to pursue against a foreign factory. For mainland China, we generally draft bilingual agreements with Chinese controlling, governed by Chinese law, and enforceable in a specified Chinese court. Those choices reflect where the manufacturer and its assets are located and where the buyer is likely to need relief. Our article China Manufacturing Contracts: Why Your Draft Does Not Work explains why familiar U.S. contract provisions often provide little leverage against a Chinese manufacturer.
For routine mainland China manufacturing disputes, we generally prefer Chinese courts. We think highly of CIETAC, but arbitration often costs more, and urgent relief against a manufacturer's assets still requires court involvement. The appropriate forum depends on the transaction, and we often decide the dispute resolution provisions only after settling the agreement's other terms and identifying the remedies that matter most.
Most of our China manufacturing agreements include agreed damages provisions tailored to the likely harm and Chinese law's rules on judicial adjustment. These provisions can help establish a defined claim for breach and support an application for court-ordered asset preservation. Freezing a manufacturer's bank accounts requires a separate court order, and the applicant may have to provide security. The ability to seek preservation before a dispute reaches final judgment can make a substantial difference when the factory still has the buyer's money, molds, or inventory.
We generally omit boilerplate force majeure clauses that expand the manufacturer's excuses for nonperformance beyond the relief already available under Chinese law. We also resist mandatory mediation or dispute escalation requirements that delay the buyer's ability to seek urgent relief. Neither approach is automatic; the provisions must reflect the transaction and the available remedies.
International contracts also require attention to the UN Convention on Contracts for the International Sale of Goods (CISG). Depending on the countries involved and the nature of the manufacturing arrangement, the CISG can apply unless the parties validly exclude it. The convention can govern contracts for goods to be manufactured, subject to its rules concerning buyer-supplied materials and predominantly service-based obligations. A governing-law clause copied from a domestic contract may overlook those questions.
Outside China, we adapt the governing law, controlling language, dispute forum, and remedies to the legal system in which the agreement must operate, bringing in qualified local counsel where appropriate. A contract that works against a manufacturer in China may need significant changes before it can protect a buyer in Vietnam, Mexico, or India.
A factory's quoted price tells you only part of what your product will cost. Tariffs, duties, import requirements, and supply chain restrictions can determine whether manufacturing in a particular country makes commercial sense. Our manufacturing lawyers work with our international trade and customs lawyers on tariff classification, customs valuation, country of origin, antidumping and countervailing duties, and import compliance. We also advise on forced-labor restrictions, including the Uyghur Forced Labor Prevention Act.
A lower factory price can still produce a higher landed cost after duties, freight, inventory requirements, and imported components are taken into account. Country of origin depends on the manufacturing operations actually performed and the applicable customs rules. Moving final assembly to another country does not automatically make the finished goods products of that country, and improper transshipment or insufficient processing can expose the importer to substantial penalties.
Customs valuation requires equal care. Buyer-supplied molds, tooling, and other qualifying assists generally must be accounted for in the customs value of imported goods under the applicable valuation rules. Separately invoicing an expense does not automatically make it non-dutiable. In appropriate transactions, our trade lawyers also evaluate lawful valuation strategies, including the First Sale Doctrine, which requires substantial supporting documentation and is unsuitable for many importing arrangements.
Depending on the product and where it is sold, importers and brand owners face testing, certification, labeling, recordkeeping, and recall obligations. A contract that simply requires the factory to comply with all applicable laws leaves open which standards apply and who is responsible for meeting them. Our contracts identify the relevant requirements and allocate responsibility for testing, certification, documentation, corrective action, and cooperation with regulatory investigations.
A recall or product liability claim can cost far more than the original manufacturing order. The buyer often has to deal with retailers, regulators, and injured customers long before it can recover anything from the factory. Because an indemnity is only worth what the manufacturer can pay, we also examine the buyer's own insurance and product liability exposure. Our guide to reducing product liability risks from overseas products explains how supplier diligence, inspections, contracts, and insurance work together.
Some clients buy products through separate purchasing companies or hold their trademarks and other intellectual property in entities that license those rights to operating businesses. Properly established and maintained structures can help limit exposure to supplier and product liability claims, though their effectiveness depends on the governing law and how the companies actually operate. Separate entities need genuine corporate separateness and properly documented transactions. Forming a new company does not eliminate debts or liabilities an existing business already owes.
Clients that own or co-own manufacturing operations abroad use our foreign direct investment lawyers for company formation, joint ventures, acquisitions, and related agreements. These projects raise additional questions about ownership, management control, technology licensing, employee obligations, and the rights of the local operating company. We coordinate these issues with the manufacturing contracts and intellectual property protections rather than treating the factory relationship as an isolated transaction.
Each manufacturing country brings different commercial risks, legal rules, and enforcement problems. We draft agreements around those differences rather than use a China contract with a new country name and translated language.
Mexico's proximity to the United States makes factory visits easier, shortens shipping times, and often allows buyers to address production problems more quickly. Yet moving from China to Mexico requires more than finding a factory closer to home. One difference we see is that some Mexican manufacturers expect buyers to arrive with more of the engineering, component sourcing, and production planning already completed. Companies accustomed to having their Chinese suppliers handle those functions must confirm what their new Mexican manufacturer will actually provide.
Mexico's civil law system also requires contracts suited to Mexican law and enforcement procedures. A U.S. manufacturing contract translated into Spanish is still a U.S. contract. The agreement needs to address local remedies, quality obligations, tooling ownership, termination, and how disputes will be resolved. Our article Moving Production to Mexico: What U.S. Companies Get Wrong discusses the legal and operational assumptions that cause problems for companies entering Mexico.
Companies establishing their own operations through a shelter arrangement or Mexican subsidiary must also consider Mexico's labor and employment requirements, including restrictions on specialized-service subcontracting, employee profit sharing, and termination costs. Import duties and customs requirements deserve attention before the new manufacturing arrangement is established. Products made in Mexico do not automatically qualify for preferential treatment under the USMCA, and companies importing Chinese components must account for Mexico's own duties, the applicable rules of origin, and programs such as IMMEX.
We also coordinate the departure from China with the start of production in Mexico. A delay in recovering molds, inventory, or technical files from the Chinese factory can disrupt the entire move. Our complete guide to moving manufacturing from China to Mexico examines those transitions in detail.
Vietnam has expanded its manufacturing capacity and is an important alternative for companies reducing their dependence on China. Its manufacturing relationships present many familiar problems, including intellectual property misuse, unauthorized subcontracting, quality disputes, and difficulty recovering equipment or deposits. Our comparison of China and Vietnam for manufacturing discusses the commercial reasons companies choose one country over the other.
We have drafted hundreds of Vietnam NNN Agreements in English and Vietnamese, and Vietnam manufacturing contracts require their own approach to enforcement and damages. One important difference concerns contractual penalties. Vietnam's Commercial Law generally limits such penalties to eight percent of the value of the breached portion of the contractual obligation. Claims for compensatory damages are treated separately and generally require proof of actual losses and the necessary causal connection. A damages provision that works well in a China manufacturing agreement therefore cannot simply be copied into a Vietnam contract.
Vietnam agreements need to account for those limitations through appropriately drafted remedies, documentation, and termination rights. The governing law, contract language, and dispute forum also require consideration based on the parties and where enforcement will be needed. And moving final assembly to Vietnam does not by itself change a product's customs origin. Companies whose Vietnamese factories rely heavily on Chinese components need to examine the actual manufacturing operations before assuming their products qualify as Vietnamese origin.
India offers substantial manufacturing opportunities, but its legal system requires a different approach from China's. Court proceedings can take years, which is one reason we often favor arbitration in Indian manufacturing agreements. The dispute resolution provisions still need to account for where the manufacturer has assets and how any award or court order will be enforced. An arbitration clause drafted without considering those practical questions can leave the buyer with an expensive remedy that accomplishes little.
India also restricts contractual restraints of trade. Section 27 of the Indian Contract Act generally renders agreements in restraint of lawful trade or business void, subject to recognized exceptions. That creates particular concerns for NNN Agreements and manufacturing contracts that contain broad noncompetition restrictions. Indian law protects genuine confidential information, but those protections must be distinguished from provisions that improperly restrict a factory's ordinary business activities. Our India manufacturing agreements are drafted around that distinction, with confidentiality and non-use obligations directed at the buyer's legitimate proprietary interests.
Guatemala is an attractive option for certain types of nearshore manufacturing, particularly apparel and textiles. A number of our clients manufacture cotton clothing there, much of it using U.S. cotton. Shorter shipping distances and the availability of preferential trade treatment can make Guatemala competitive for the right products, though its supplier base is less extensive than China's. Our comparison of Cambodia and Guatemala for manufacturing discusses the different strengths and risks of the two locations.
Tariffs are particularly important for apparel. Products that satisfy CAFTA-DR's applicable rules of origin can enter the United States duty-free. In July 2026, the United States imposed an additional 10 percent Section 301 tariff on many Guatemalan products, but the action exempted qualifying CAFTA-DR textile and apparel products, along with certain other goods. The exemption is described in the U.S. Trade Representative's July 2026 Section 301 action.
Qualification depends on the product and the applicable origin rules, including requirements concerning yarn, fabric, and other inputs. A garment does not necessarily qualify merely because it was sewn in Guatemala. We therefore examine supplier sourcing arrangements and documentation before a client relies on duty-free treatment. Our manufacturing agreements address the factory's obligations to provide accurate production records and the information needed to substantiate preferential origin claims.
Colombia and Peru attract companies seeking alternatives to Asian manufacturing, and both have trade agreements with the United States. For some products, however, a lack of reliable component suppliers can create problems that do not arise as frequently in China's much larger manufacturing ecosystem.
We have seen this firsthand. Clients of ours encountered serious problems in both Colombia and Peru when relatively inexperienced manufacturers ran short of parts needed to produce outdoor equipment. The clients had to order replacement components flown in from China. During their first year of Latin American manufacturing, both ended up with products that cost more and arrived later than they had expected. The attractive factory prices had concealed supply chains that were not ready to support production.
These experiences affect how we assess manufacturers and draft their agreements. We examine the availability of essential parts and whether the supplier has reliable alternatives when a component becomes unavailable. Depending on the product and manufacturing arrangement, we also address spare-parts inventories, sourcing responsibility, substitute components, production delays, and the cost of emergency shipments. The manufacturer's quoted unit price means little if it cannot obtain the materials needed to deliver on time.
Our clients manufacturing sophisticated components in Taiwan and South Korea often pay more for technical capability and manufacturing precision. Their contracts need to reflect that investment. A small deviation from specification can make a specialized component unusable, and the consequences can extend well beyond the cost of replacing the defective item.
These agreements require particular attention to technical specifications, production tolerances, testing requirements, component traceability, and restrictions on unauthorized changes to materials or manufacturing methods. When both the buyer and the manufacturer contribute valuable technology, ownership of improvements and future use rights also require careful treatment. For Taiwan, access to technical files, tooling, and alternative production capacity can be especially important to companies concerned about relying too heavily on a single manufacturing location.
Moving production can go wrong before the new factory makes its first product. The existing manufacturer may control the molds, technical files, raw materials, and unfinished inventory the buyer needs to keep operating. If the factory learns of the planned move before those assets are secured, it gains leverage that can make the transition far more expensive.
Before announcing a move, we examine who owns the equipment and files, what the existing contract permits, which obligations survive termination, and what must happen before the buyer can start production elsewhere. We help clients plan termination notices, final orders, inventory transfers, tooling recovery, and the transition to the new supplier. The sequence matters because a factory that knows it is losing the business has little incentive to make departure easy.
The new manufacturing location requires its own contracts and usually a review of trademark and other intellectual property registrations. Chinese registrations do not establish rights in Mexico, Vietnam, India, or other manufacturing countries. Our article on reformulating your intellectual property strategy when manufacturing beyond China explains how to approach those protections.
Labor costs are only one consideration in choosing a new manufacturing location. Component availability, quality control, tariffs, customs origin, and the ability to enforce contracts can matter just as much. We coordinate the legal work associated with leaving one country and beginning production in another so that problems with the existing supplier do not undermine the new relationship.
When a Chinese factory refused to return molds belonging to one of our clients, we worked with Chinese litigation counsel to sue and obtain an asset-preservation order. The court froze the factory's bank accounts within about five days, and the factory released the molds the next day. The result depended on having a contract and evidence strong enough to support both the claim and the preservation application.
Our international dispute resolution lawyers represent companies against foreign manufacturers in negotiations, litigation, arbitration, and enforcement proceedings. Across our broader China disputes practice, which extends beyond manufacturing, we have collected amounts ranging from $65,000 to ~$35 million from Chinese companies. Those matters have involved different contracts, claims, and collection methods, and each required an assessment of what could realistically be recovered.
Before recommending litigation against a Chinese manufacturer, we examine whether the agreement binds the correct legal entity, the evidence supporting the claim, the remedies available under the contract, and the manufacturer's assets. We prefer contracts that identify the company's registered Chinese legal name, are properly executed, use Chinese as the controlling language, and contain enforceable agreed damages provisions where appropriate. Chinese courts can enforce contracts that lack some of these features, but including them reduces disputes over identity, contractual meaning, and available remedies.
The claim must also justify the cost of pursuing it. A strong case against a company with no reachable assets has little economic value, and international litigation can consume much of a modest recovery. Money is not always the only consideration, however. Recovering essential tooling or preventing a factory from exploiting a valuable design can justify litigation even when the immediate monetary claim is relatively small. Our guide to suing Chinese companies explains how we assess these decisions and why negotiation or walking away is sometimes more sensible than bringing a lawsuit.
Supplier disputes can turn into Sinosure claims. A Chinese supplier says the buyer failed to pay, Sinosure compensates the supplier under its export credit insurance policy, and Sinosure or its collection representatives pursue the foreign buyer. Many of these matters involve products the buyer contends were defective, late, or never delivered.
We have handled more than 100 Sinosure matters, and very few of our clients have paid Sinosure anything. That experience does not mean Sinosure claims can be ignored. It means that a demand from Sinosure is not itself a judgment establishing that the buyer owes the amount demanded, and the underlying contracts, invoices, product defects, and payment history all matter.
Companies facing serious disputes with Chinese suppliers should preserve their evidence and assess what the supplier or Sinosure can do to their business. That includes identifying molds, deposits, trademarks, receivables, and other assets in China. Before owners or key personnel travel to mainland China during an unresolved dispute, the company should also assess the risk of exit bans or other restrictions. These concerns become more urgent when litigation or collection proceedings are underway.
The period before a dispute escalates is often the best opportunity to protect the business. Once a supplier has initiated proceedings or taken action involving the buyer's assets, the available choices narrow. Our complete guide to Sinosure claims explains how these claims arise and what foreign buyers should examine before responding.
The results described on this page depended on the facts of each matter and do not guarantee a similar outcome.
Arlo Kipfer leads our international manufacturing practice and drafts nearly all the firm's manufacturing agreements. He has more than 25 years of experience working in and with China and lived there for nearly two decades, including as an executive responsible for an international company's China operations. Fluent in Mandarin, he brings both business and legal experience to manufacturing contracts, supplier due diligence, intellectual property protection, and problems involving foreign factories.
Dan Harris co-founded the firm in 1998 and very quickly steered the firm's practice to international manufacturing. He founded the China Law Blog in 2006 and remains its principal writer. The ABA Journal inducted the blog into its Blawg 100 Hall of Fame. Dan has testified four times before the U.S.-China Economic and Security Review Commission, which has cited his testimony and writing in its annual reports to Congress. Most of that testimony related to international manufacturing. He also spent roughly a decade overseeing the product liability defense of a Canadian truck manufacturer, experience that informs the firm's work on manufacturing contracts, product liability, and corporate structures.
Frederic Rocafort heads our China intellectual property practice and leads our Latin America practice. A former U.S. diplomat, he is a native Spanish speaker who is fluent in Mandarin. He handles China trademark work, international intellectual property protection, and the intellectual property provisions of manufacturing agreements. Adams Lee and our other international trade lawyers advise on customs, tariffs, country of origin, and trade enforcement issues that affect overseas production. When a manufacturing project spans countries or legal specialties, our lawyers coordinate the work around the client's commercial objectives.
Nadja Vietz leads our Spain practice and works with American and European businesses on cross-border transactions and foreign investment involving Spain, Germany, the United States, and Latin America. Licensed to practice law in Germany, Spain, and Washington State, she brings experience in corporate and commercial law and international business matters. She works fluently in German, Spanish, and English.
Tânia Pinheiro heads our Lisbon office and advises clients on Portuguese and international tax, corporate law, and foreign investment. She has extensive experience negotiating international contracts and working on mergers and acquisitions. A member of the Portuguese Bar, she speaks Portuguese, English, and German.
We charge flat fees for most international manufacturing contracts, including NNN Agreements, manufacturing agreements, mold ownership agreements, and product development agreements, as well as for international trademark filings. We first determine which agreements and registrations the project needs and quote the fee before starting. Once the client provides the necessary information, we prepare the documents and handle revisions within the agreed scope.
Our usual drafting turnaround is two to three business days for an NNN Agreement and three to five business days for a manufacturing agreement, depending on the work involved.
Part of our job is telling clients what they do not need. Some manufacturing projects justify several coordinated agreements and trademark registrations. Others require much less. We recommend legal work based on the manufacturing relationship, the value at risk, and what the proposed protection will actually accomplish.
An NNN Agreement makes sense when you must disclose proprietary designs, formulas, technical information, or valuable customer relationships to a prospective manufacturer. Sign it before disclosing the information. If you are buying standard products and sharing nothing sensitive, an NNN Agreement often adds little protection, and trademark registration or another measure may be a better investment.
Generally, yes, particularly if your brand appears on the products or packaging. A trademark registered in the United States or another country does not ordinarily give you a trademark registration in any other country. A third party that registers your brand in the country in which you are manufacturing can interfere with your manufacturing and exports. We recommend examining your international trademark protection before production begins.
We generally recommend a bilingual agreement with Chinese controlling. An English-only contract is not automatically invalid in China, but enforcing it in a Chinese court requires translation and can create disputes over what important provisions mean. The governing law, controlling language, and dispute forum should be selected together based on where enforcement will be needed.
Start with the manufacturer's exact registered legal name and confirm that the entity signing the agreement is the company you intend to bind. When another entity owns the factory or holds the tooling, the contractual arrangement must address that difference. Execution authority and the company chop also matter in some countries. Formal chop verification is worth considering for particularly large or high-risk transactions, but it is not necessary for every routine manufacturing agreement.
No. Commercial terms can often be carried over, but the legal provisions need to reflect the country involved. Vietnam generally limits contractual penalties under its Commercial Law, while India restricts agreements in restraint of trade. The appropriate governing law, contract language, forum, and remedies also differ. Translating a China manufacturing agreement does not make it enforceable in Vietnam or India.
First, determine what the factory still holds, including finished products, raw materials, molds, technical files, and deposits. Review your contractual rights before terminating the relationship or withholding payments. At the same time, assess whether another factory can make the product and what equipment or information it will need. Moving production becomes much harder when the existing manufacturer controls critical assets and the buyer has no practical means of recovering them.
Generally, no. For NNN and manufacturing agreements, we ordinarily draft new agreements rather than revise documents prepared by clients, other lawyers, template providers, or AI. Working through an unsuitable draft usually costs the client more than starting with agreements we have developed and refined through years of China manufacturing work. Our article China Manufacturing Contracts: Why Your Draft Does Not Work explains why. The most important provisions depend on the transaction, the manufacturer, and the legal system in which enforcement will occur.
Preserve the evidence immediately, including inspection reports, photographs, samples, purchase orders, packaging, and communications with the supplier. Save WeChat and other electronic messages in their original form where possible. Before withholding payment or canceling orders, review the contract's inspection, notice, rejection, and payment provisions. Those decisions can affect your legal position and, in disputes with Chinese suppliers, can lead to a Sinosure claim.
That depends on what you stand to recover, what legal action will cost, and whether the manufacturer has assets you can reach. For monetary claims against Chinese manufacturers, we generally discourage litigation or arbitration when the likely recovery is too small to justify the expense. Recovering essential tooling or stopping a manufacturer from exploiting valuable intellectual property can change that analysis. We review the evidence and available remedies before recommending a lawsuit, arbitration, negotiation, or a decision to walk away.
If you are selecting an overseas factory, negotiating a manufacturing agreement, moving production to another country, or dealing with a supplier dispute, contact our international manufacturing lawyers. Tell us what you manufacture, where it is made, and what problem you need to solve. We will explain the work we recommend and its cost.
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I have been working with the lawyers at Harris Sliwoski for more than 20 years both as a business owner and as an executive at a large east-coast health system and that is because they have always efficiently provided high level and clear international law advice. Most recently, Harris Sliwoski provided legal support on many matters related to procuring medical products worldwide. Their support was particularly helpful to during the onset of COVID, when there was a big need for securing PPE quickly, all while navigating complicated international and domestic legal requirements. Harris Sliwoski’s team of international lawyers helped by conducting rapid-fire due diligence on potential suppliers, navigating the legal logistics for getting product from overseas and through U.S. customs, and drafting contracts to protect against various sorts of horribles. They did this by essentially providing what amounted to 24/7 service. I cannot recommend them highly enough.
Dan Pak Hospital Supply Chain Executive
We use Harris Sliwoski on all our international legal matters, including on our international litigation matters. We have over the last few years been involved in a couple big international legal disputes and Harris Sliwoski’s international dispute resolution team provided us with expert legal assistance on both matters. They were always very careful to explain to us what they were doing and why and what their actions would likely cost us in legal fees. Most importantly, we did extremely well on both cases and I have no doubt Harris Sliwoski was a big factor in that.
Kevin English, CEO We Are Camp
We have used Harris Sliwoski for legal help related to our international manufacturing. The lawyers with whom I worked had extensive familiarity with the international legal issues involved in our various projects and offered us key insights. I particularly appreciated how they always quickly and efficiently do what they say they will do and always within their cost estimates.
Andrea Barona Valladolid, Senior Legal Counsel Fairphone
“Harris Sliwoski expertly guided us through the formation of our company. They continue to assist with necessary registrations and compliance with numerous regulations. They were able to promptly answer all our many questions and provide understandable options, explanations and practical advice. We expect to continue to use Harris Sliwoski on a regular basis as our company expands. They were also able to introduce us other professional experts. We would not hesitate to recommend Harris Sliwoski to any companies in need of legal advice.”
Three Continents Foods LLC
