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Tips of Contract Manufacturing or License Manufacturing from China Commercial Lawyer

When a hiring firm wishes to have a product manufactured they often seek outside Chinese manufacturers. This is known as contract manufacturing. As experienced Chinese lawyer, we extensively assist our foreign clients find Chinese manufacturers. We summarized the opinion we gave to our clients and we hope these tips will help you along the way doing business with Chinese partner. However, please keep in mind these tips are not supplement of our China commercial lawyer's professional service. You are highly recommended to consult us before you make your business decision in China.

The contract manufacturer takes the components or the complete product design and produces the product for the hiring company. This is done to help minimize cost and usually is more efficient in a production standpoint for a company wishing to quickly develop a product and move it to market. This allows the hiring firm to continue to design products for the product life cycle without having to assume the overhead cost of a manufacturing plant. This can be a tricky process because the hiring firm must quickly and correctly choose a contract manufacturer that is a good fit to develop and produce their product. Failure to do this correctly can have catastrophic results. Here are 7 tips for firms wishing to use contract manufacturing-

1. Ask questions to gauge the contract manufacturing firm's reliability. The hiring company needs to determine whether a prospective manufacturer offers quality service, on-time delivery and quick attention to problems. This may require a bit of homework. Ask for referrals from other customers. The hiring company can also gain further clues about a potential candidate from data on its size, past clientele and financial history. All of these should indicate that a company is in the business for the long haul.


China Contract Manufacturing - China Business Lawyer's Tips

Contract manufacturing or OEM manufacturing in China refer to the production of goods by one firm, under the label or brand of another firm in China. As China is the universal factory, many business owners select China partners as their manufacturer. As experience China contract law and business lawyer, we have extensive experience in helping clients screening Chinese manufacturers and verifying the legitimacy of the Chinese suppliers. Contract manufacturers provide such service to several (even competing) firms based on their own or the customers' designs, formulas, and/or specifications. Also called private label manufacturing.

Are you in the search for a company that can provide you with contract manufacturing services? Do you have temporary manufacturing needs that need to be answered promptly? Do you lack the human resource for this task? If you have answered yes to any of the above questions, then it would be great news to say that there are groups and organizations which can do your needed service for reasonable prices.

Here are some useful tips that you can consider when searching for contract manufacturing outsourcing company:

1. Choose a company which can prove excellent track record.

Whenever you need to get a job done, it always pays to find someone who can do it and has a track record to speak of. You would not want a job to fail or to fall below your expectations. Wanting to spend within budget is never enough reason t get below standard output. If you want to look for an outsourcing company which can answer to your business’ temporary needs, then find a group that has proven itself in terms of quality work output and reliability.


China Legal Consultant


We are China legal consultant. If you are a foreign law firm or lawyer need China law service, please contact us. Also, if you want to do business in the People's Republic of China or import Chinese products into the United States, we can assist you in getting started.  If you have a dispute with a Chinese company we can work with you to resolve it.  Or if you’re a Chinese company that is interested in doing business in the United States or has a dispute with an American company, we can advise you on a course of action.

Services: We provide our expertise and consultation for International Trade matters through five different practice areas, including (1) Export-Import Transactions; (2) Corporate and Commercial Transactions; (3) Finance; (4) Intellectual Property; and (5) Litigation, Arbitration and Mediation;(6) China law expert witness; (7) China law expert opinion.  We also provide a full-service approach in other international practice areas such as immigration, admiralty and taxation through our association with other law firms in Southern California and the People's Republic of China.

Part-Time General Counsel Program: we are available to act as part-time in-house counsel for your business to reduce your outside legal costs.


How Foreign Nationals Working in China Participating Chinese Social Insurance Program

Below is the official regulation regarding how foreign nationals working in China participating Chinese social insurance system. It is highly recommended that you inquire us - we are China business lawyer - and clarify the difficulty in understanding this authority.

Interim Measures for the Participation in Social Insurance of Foreigners Employed in China

Article 1 The Interim Measures is promulgated in accordance with the Social Insurance Law of the People’s Republic of China for the purpose of protecting the legal rights of foreigners with employments in China to participate in and enjoy the benefits of social insurance.

Article 2 Foreigners with employments in China include non-Chinese citizens who legally apply and possess employment permits, such as Alien Employment Permit, Foreign Experts Certificate, Permanent Foreign Journalist Identity Card.

Article 3 Foreigners who are legally employed by enterprises, public institutions, social groups, privately-owned non-enterprise units, foundations, law firms and accounting firms which have been incorporated or registered in line with the laws in China are required to participate in basic pension insurance, basic medical insurance, work-related injury insurance, unemployment insurance and maternity insurance. The employing units and foreigners should pay the social insurance premiums in accordance with relevant regulations.

Foreigners who entered into employment contracts with employers outside of China and are dispatched to work in branch or representative offices incorporated or registered in China are required to participate in basic pension insurance, basic medical insurance, work-related injury insurance, unemployment insurance and maternity insurance. The units to whom the foreigners work for and the foreigners should pay the social insurance premiums in accordance with relevant regulations.

Article 4 The employing units which hire the foreigners should be responsible for the registration of social insurance for the foreigners in accordance with the laws.

The units to which the foreigners are being dispatched to work for should be responsible for the registration of social insurance for the foreigners.

Article 5 Foreigners who participate social insurance meet the prescribed conditions should be eligible to enjoy the benefits of social insurance.

Where a foreigner departs China prior to the stipulated age for receiving pension, his or her individual account will be retained. Where the foreigner reenters China for employment, the payment period can be calculated cumulatively. Upon written application by the foreigner, the social insurance agency can pay the foreigner the amount in his or her individual account in one lump sum and terminate the basic pension relationship.

Article 6 Upon the foreigner’s death, the amount remaining in his or her individual pension insurance account can be inherited.

Article 7 Foreigners who reside outside the territory of China and receive monthly social insurance should produce to the agencies which handle their social insurance a Certificate of Alive issued by the Chinese Embassy or Consulate General, or a Certificate of Alive duly notarized by the authorized attesting organizations and legalized by the Chinese Embassy or Consulate General in the country where they reside.

Article 8 Foreigners, who participate in social insurance, has any dispute with his employing unit or work unit because of social insurance, can apply for mediation, arbitration and litigation. Foreigners may request social insurance administrative departments or social insurance premium collection institutions to deal with situations where their rights are fringed by the employing units or work units.

Article 9 foreigners who are nationals of countries that have entered into bilateral or multilateral treaties relating to social insurance with China, his or her social insurance participation shall be handled in accordance with such treaties

Article 10 The social insurance agencies should set up social insurance numbers and issue social insurance cards to the foreigners in accordance with the Rules on the Preparation of Social Security Numbers for Foreigners.

Article 11 The social insurance agencies should check and implement this policy.

If Employing unit is failing to pay social insurance premiums based the law, according to Social Security Law, "Labor Security Supervision Regulations" and other laws, The social insurance agencies shall have right to punish those units.

Article 12 The Interim Measures should come into force on 15th Oct 2011.

Interim Measures for the Participation in Social Insurance of Foreigners Employed in China is translated by our China international attorney. There may be independent local administrative regulations in this area.


Notarization in Mainland China and Hong Kong China-Appointed Attesting Officer

Public Notary Office (Chinese: 公证处) is a subordinate agency of the Ministry of Justice of the People's Republic of China. It is responsible for certifying documents according to Chinese legal system. Examples of services offered are certification of Birth Certificates, identification cards, Household Registration documents, Driver's License, Police Records, Health Records, Property title, power of attorney, guarantor documents, authorization documents, declaration documents, lottery tickets certification and business licenses. If you need to notarize document originated or executed in Hong Kong, you will have to find some China Appointed Attesting Officer, Holding Current Practising Certificate, Notary Public (member of the Hong Kong Society of Notaries.

Purpose of Notarization

The functions of the Public Notary Office is classified into 4 functions.

1. To safeguard the smooth process of the state economic restructuring and economic construction, maintain the order of socialist market economy.

2. To protect lawful rights and interests of citizens, legal persons and other organizations, prevent disputes and minimize litigation.

3. To develop notary standards and promote the process of the international civil and economic activity. To protect lawful rights and interests of citizens, organizations, overseas Chinese and foreigners.

4. To inform and educate the legal knowledge, improve legal sense of the people, maintain the legal system and guarantee the correct implement of state laws.

Notarization in Mainland China

There are many document can be notarized by the embassy such as Company Incorporation Documents, Business Registration Documents and Identity Documents, those notarized documents can be used on business, investment, loan, property, mortgage and trading. A well-notarized document can you to start business oversea, study aboard, marry abroad, and get inheritor identity. Notarization helps applicant to make their document legalized oversea.


Notarization, Legalization and Authentication of Documents, Evidence or Instrument in china

As experienced China lawyer, we handle cases where foreign law firm or client need to legalize documents originated or executed in China to be used in United States or other jurisdictions. The procedure for legalization or authentication is quite complicated, so we strongly recommend you to retain our service to accomplish the job for you.

Procedures of Legalization or Authentication

For a document originated or executed in China to be used as evidence in other jurisdiction, the document must be firstly notarized by local Notary Public in China. Then the document would be sent to China Ministry of Foreign Affairs for endorsement. Finally, the endorsed document is sent to the consulate of the jurisdiction where the document is to be used for authentication. There may be translation work required before starting the procedure.

Document to Be Used in USA

Consular Officers perform notary services customarily provided by Notaries Public in the United States. All notary services require an appointment.For notary fee information, please see our list of common fees.Generally, documents to be notarized should be in English and should be intended for use in the United States. The Consulate cannot provide translation services or notaries for documents that will not be used in the United States. Non-U.S. citizens may obtain notaries for use in the United States, but must provide a passport for identification. The Consulate will not accept Chinese National ID cards as identification.

If you are getting married in China and need to get a notary for an Affidavit of Eligibility to Marry, you need to prepare some document.

Requirements for Notary Services

For Oaths:

•Appear in person
•Provide proof of your identity
•Swear or affirm after indicating a basic understanding of the penalty for perjury
•Sign in the consular officer’s presence


China Law Expert Testimony

China law expert witness is a person who is a specialist in a subject, often technical, who may present his/her expert opinion without having been a witness to any occurrence relating to the lawsuit or criminal case involving China law. It is an exception to the rule against giving an opinion in trial, provided that the expert is qualified by evidence of his/her expertise, training and special knowledge. If the expertise is challenged, the attorney for the party calling the "expert" must make a showing of the necessary background through questions in court, and the trial judge has discretion to qualify the witness or rule he/she is not an expert, or is an expert on limited subjects. Experts are usually paid handsomely for their services and may be asked by the opposition the amount they are receiving for their work on the case. In most jurisdictions, both sides must exchange the names and addresses of proposed experts to allow pre-trial depositions.

China Law Expert Testimony

Testimony about a scientific, technical, or professional issue given by a person qualified to testify because of familiarity with the subject or special training in the field. As experienced Chinese lawyer, we frequently give legal opinion regarding Chinese law in many jurisdictions.

Generally speaking, the law of evidence in both civil and criminal cases confines the testimony of witnesses to statements of concrete facts within their own observation, knowledge, and recollection. Testimony must normally state facts perceived by the witnesses' use of their own senses, as distinguished from their opinions, inferences, impressions, and conclusions drawn from the facts. Opinion testimony that is based on facts is usually considered incompetent and inadmissible, if the factfinders are as well qualified as the witness to draw conclusions from the facts.

In certain instances, however, the law allows witnesses to provide opinion evidence, and such evidence is divided into two classes, lay opinion and expert opinion. A lay witness may give his or her opinion when that opinion is (1) rationally based on the perception of the witness; (2) helpful to a clear understanding of the witness' testimony or the determination of a fact in issue; and (3) not based on scientific, technical, or other specialized knowledge within the scope of expert testimony discussed below. Thus, lay witnesses who have had an opportunity to observe a particular vehicle in motion are normally permitted to testify that it was traveling at a great rate of speed or was going pretty fast. Lay witnesses are also normally allowed to give their opinion as to the height, weight, quantity, and dimensions of things, even if their testimony is not precise. By definition, a lay witness is any witness who is not qualified to testify as an expert on a particular subject.


China Law Expert Opinion Provided By China Lawyer

In law, an opinion (also consilia) is usually a written explanation by a judge or group of judges that accompanies an order or ruling in a case, laying out the rationale and legal principles for the ruling. As China practicing lawyer for more than 10 years, we provide China law legal opinion on various China law issues for foreign lawyers, foreign courts and arbitration tribunals. We also call it China law expert opinion.

Nature and Scope of China Law Expert Opinion

Opinions are usually published at the direction of the court, and to the extent they contain pronouncements about what the law is and how it should be interpreted, they reinforce, change, establish, or overturn legal precedent. If a court decides that an opinion should be published, the opinion is included in a volume from a series of books called law reports (or reporters in the United States). Published opinions of courts are also collectively referred to as case law, which is one of the major sources of law in common law legal systems.

Legal opinions are commonly used in a variety of situations. For example, in the context of a cross-border transaction, a legal opinion may be used for the purpose of opining on whether certain transaction documentation is valid and enforceable in a particular jurisdiction and complies with the local law of that jurisdiction. In transactions involving multiple jurisdictions where the governing law of the documentation is English law, a combination of foreign and English law legal opinions may be required and in such circumstances the lawyers in the relevant jurisdictions will need to ensure that together the legal opinions opine on all relevant matters.

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I am a licensed China lawyer. Most clients are foreign nationals and companies. China Lawyer Blog have associates in Beijing, Shanghai, Tianjin, Guangzhou, Suzhou, Nanjing, Qingdao, Fuzhou, Hainan, Hefei, Wuhan, Xian, Changsha, Xiamen and Hangzhou. Learn More

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This China Lawyer Blog is aiming at providing better knowledge and understanding of Chinese law for foreigners. Should you have any legal issue in China, do not hesitate to contact China Lawyer Blog for consultation. Preliminary consultation is free. Further legal service, however, will be charged in due rate and in due course.

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China Lawyer BLog AuthorPeter Zhu, an experienced China attorney licensed to practice law for more than ten years, the author of this China Lawyer blog, welcomes any enquiry or consultation related to Chinese law.