Supplier verification is particularly important for overseas buyers dealing with companies in Hangzhou. Hangzhou combines a strong technology and e-commerce economy with manufacturing and export-oriented industrial activity. The buyer should distinguish the commercial location of a supplier from the legal identity of the entity that actually signed the contract and received the payment.
Why is fraud so difficult to establish under Chinese law? Attorney Qiang Lyu often receives inquiries from clients saying, “Attorney Lyu, I’ve been scammed. I shipped the goods but received no payment, or I paid in full but got no delivery. This is fraud, and I want you to help me report it to the police to pursue criminal liability.”
In such situations, I always tell my clients directly: fraud is not as easy to prove as you might think. To establish a criminal fraud offense, at least three key elements must be met:
The offender fabricated facts or materially concealed the truth.
The offender possessed the intent to defraud from the very beginning.
If the offender defrauded three or more victims, it is more likely to be recognized as fraud.
In legal practice, most fraud reports submitted to the public security authorities are not accepted as criminal cases. Instead, the police will issue a written notice advising the victim to file a civil lawsuit in court.
Just put yourself in their position: If every dispute over non-payment for goods or non-delivery after payment were treated as criminal fraud, there would be no need for civil courts at all.
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Checking a Hangzhou Supplier Before a Dispute
The local market includes businesses active in technology, e-commerce, electronics, machinery and consumer products. Depending on the transaction, relevant issues may include technology-related contract disputes, OEM disputes, quality claims, delivery problems and payment disputes. For technology, e-commerce, electronics and consumer-product transactions, buyers should pay particular attention to the contracting entity, product or service specifications, intellectual-property provisions, payment records and performance obligations.
For a cross-border transaction, the buyer should keep the supplier’s Chinese legal name, registration information, contract, invoices, bank-payment records and communications together. Hangzhou forms part of Zhejiang and its commercial network includes strong technology, e-commerce and manufacturing networks supporting international trade.
Evidence and Contract Review for Hangzhou Transactions
If a dispute develops, evidence should be preserved before important communications or negotiations change the factual record. The relevant documents may include the contract, purchase orders, specifications, inspection records, invoices, payment records, shipping documents and correspondence.
The information provided in this article is for general informational purposes only and does not constitute legal advice. Laws and legal procedures may vary depending on the specific facts and applicable jurisdiction. No lawyer-client relationship is created by reading this article or contacting us through this website. For advice regarding a specific matter, please consult a qualified lawyer after a formal engagement has been established.
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Qiang Lyu
His practice also includes China company law, intellectual property matters, and commercial contract disputes involving foreign-invested businesses and cross-border commercial activities.