• Corporate structure protecting owners from personal liability.
• Minimum capital of RMB 30,000.
• At least 30% of registered capital must be in currency.

An LLC is a corporate structure which protects its owners from being personally responsible for any liabilities. To establish a limited liability company a minimum capital of RMB 30,000 that can be paid in currency, in kind, intellectual property, land-use, or other non-money property is required. The amount of capital contributions in currency paid by all the shareholders shall be no less than 30% of the registered capital of the limited liability company.

Offers liability protection with flexible capital contribution options. Suitable for small to medium-sized businesses.

• Owned by investors with shareholding.
• Minimum capital requirement of RMB 5 million.
• Company liable for debts with all property.

The company is a business owned by its investors with each investor owning a share of the company based on the contributed investment. The company requires a minimum capital of RMB 5 million, and the company bears the liability for their debts with all their property.

Suitable for larger enterprises seeking to raise significant capital through multiple investors.

• National Enterprise Credit Information Publicity System
• Local Administration for Industry and Commerce (AIC) offices
• Third-party business information providers

The primary source for corporate information in China is the National Enterprise Credit Information Publicity System (国家企业信用信息公示系统). This centralized database provides basic information on all registered companies in China.

Key resources:

• National Enterprise Credit Information Publicity System (Chinese only)
• State Administration for Market Regulation (SAMR)
• Local AIC offices (search for "[City name] AIC" for specific locations)

Third-party providers offer more user-friendly interfaces and additional analytics, though they may require paid subscriptions for detailed information:

• Qichacha (企查查)
• Tianyancha (天眼查)

Use the official National Enterprise Credit Information Publicity System for basic, reliable information. Consider third-party providers for more in-depth analysis and user-friendly interfaces. Always verify critical information through official channels.

• People's Bank of China Credit Reference Center
• Commercial credit reporting agencies
• Industry-specific credit information systems

For comprehensive credit information:

• People's Bank of China Credit Reference Center (for financial credit information)
• Commercial agencies:
  • Sinotrust
  • Experian China
  • Dun & Bradstreet China
• Industry-specific systems: e.g., China Chengxin International Credit Rating Co., Ltd. for bond ratings

Note that access to detailed credit reports often requires proper authorization or membership.

Combine official sources with reputable commercial credit agencies for a comprehensive view of a company's financial health. Be prepared to provide authorization or pay for detailed reports.

• China Judgments Online
• Local court websites
• Professional legal databases

To find judgments against businesses:

• China Judgments Online (official database of court judgments)
• Local court websites (e.g., Beijing Courts)
• Professional legal databases:
  • Pkulaw (subscription required)
  • Lawyee (subscription required)

Many third-party business information providers also include judgment information in their company reports.

Start with China Judgments Online for free access to court decisions. For more comprehensive searches, consider using professional legal databases or business information services. Be aware that some cases may not be publicly available due to privacy or sensitivity concerns.

• Copies of Invoices
• Copy of Contract

You will need the following documents as a minimum:

• Copies Invoices
• Copy Contract (a written contract is necessary in China)

Ensure all contracts are in writing and maintain comprehensive documentation for all business transactions.

• Allows seller to retain ownership until conditions are met.
• Governed by Contract Law of the PRC.

When included in trade contracts, retention of title allows the seller to retain ownership over the goods supplied until certain contractually defined conditions are met, therefore providing the seller with a form of security against the buyer's default or insolvency.

In the Contract Law of the PRC there are several articles to consider:

• Article 133. The ownership of a targeted matter is transferred upon the delivery of the targeted matter, unless the law provides otherwise, or the parties stipulate otherwise.
• Article 134. The parties may stipulate in a purchase and sales contract that the supplier retains ownership of the targeted matter if the buyer fails to pay the price or perform other obligations.

Consider including retention of title clauses in contracts for additional protection. Be aware of specific legal provisions in Chinese Contract Law.

• No legal requirement for warning notice.
• Pre-court procedure may exist.

In China, private law regulates the relations between people or companies. There is no need to give a warning prior to starting a lawsuit. When a case is sent to a court, there may be a pre-court procedure.

While not legally required, consider sending a demand letter as a courtesy and potential negotiation tool.

• Interest based on People's Bank of China loan rate plus 30% to 50%.
• Cultural resistance to late payment interest charges.
• Debt collection costs can be charged to the debtor.

Interest is calculated from the loan rate set by the People's Bank of China, plus 30% to 50% (the Reply of Supreme People's Court on the Calculation Standard of Late Payment Penalty).

From a cultural point of view, Chinese debtors are not used to paying late payment interest charges.

From the point of view of Chinese law, the seller has the debt collection costs to the debtor.

Be aware of cultural attitudes towards late payment charges. Consider including clear terms for interest and collection costs in contracts.

• General limitation period: 3 years
• Specific cases: 12 months or 180 days
• No specific statute for outstanding invoices

The limitation period for protection of civil rights is three years, unless otherwise stipulated (General Principles of the Civil Law of the PRC, Article 135).

However, this period is only twelve months for the following cases:

• Compensation claims on physical injuries
• Sales of substandard products without notice of the effect
• Rent payment delays
• Loss or damage to property under care of another person

The limitation period for claims against carriers regarding carriage of goods by sea is 12 months year from the delivery date of the products; or the expected delivery date.

The limitation period for claims against rail carriage is 180 days.

There is no such statute for outstanding invoices.

Be aware of different limitation periods for various types of claims. Act promptly to avoid exceeding these time limits, especially for specific cases with shorter periods.

• Four main methods: negotiation, conciliation (mediation), arbitration, and litigation.
• Not compulsory before or during proceedings.

Traditionally, it is generally agreed that there are four ways of resolving commercial disputes of international character in China; negotiation, conciliation (mediation), arbitration and litigation.

Parties to litigation or arbitration are not required by law to consider ADR before or during proceedings. The court or tribunal cannot compel the parties to participate in an ADR process.

Consider ADR methods as potentially faster and more cost-effective alternatives to court proceedings. Be aware that participation is voluntary.

• Hierarchical structure with four levels of courts.
• Specific requirements for filing a lawsuit.

At the top of the court hierarchy in China is the Supreme People's Court, the High People's Courts, the Intermediate People's Courts, and the Basic People's Courts.

The Basic People's Courts have jurisdiction over civil cases, some of which may be escalated to the Intermediate People's Courts due to size or impact. Any cases deemed 'too large' for the Intermediate People's court will also be escalated. The Supreme People's Court has the right to give interpretations of questions concerning specific applications of laws and decrees in judicial proceedings.

When filing a lawsuit, the following criteria must be met and information provided:

• The plaintiff must be a citizen, a legal person, or any organisation with direct relations with the debtor who must also be a citizen, a legal person, or organisation.
• The lawsuit must have just cause with specific factual evidence.
• The names, genders, ages, ethnic status, occupations, work units, and home addresses of the parties must be provided. The details of any legal representatives must also be listed.
• Witness based evidence and testimonies must be provided as well as the names and home addresses of the witnesses.
• Only copies of documents are required (i.e. no originals)

Understand the court hierarchy and jurisdiction. Ensure all required information and evidence is prepared before filing a lawsuit.

• Summary procedure: 3 months
• Ordinary procedure: 6 months
• Possible extensions under special circumstances

Cases tried against a summary procedure must be concluded within three months of its registration by the People's Court. Cases handled via an ordinary procedure will be concluded within six months from the date of acceptance.

The president of the court is entitled to offer an extension of up to six months under special circumstances. Anything beyond the six-month period must be reported to the People's Court at a higher level. The case on appeal will be concluded within three months after being docketed by the people's court.

Be prepared for potentially lengthy legal processes. Consider the time frame when deciding whether to pursue legal action.

• Court costs paid by filing party
• Litigation fees paid by unsuccessful party

Court costs are incurred by the party filing a civil lawsuit. However, any litigation fees are to be paid by the unsuccessful party.

Consider potential costs when deciding to pursue legal action. Be prepared to pay initial court costs, but understand that litigation fees may be recoverable if successful.

• Execution order required for non-compliant parties
• Enforcement officer can freeze assets and seize property
• Enforcement fees borne by the debtor

In the event whereby a party refuses to comply with a legal judgement, the opposing party my apply for an execution order. Such an order, when approved by a judge, grants an enforcement officer (sheriff) the right to assess and freeze the income streams of the debtor such as salaries, shared, bank deposits etc.

The sheriff is also able to visit the debtor's registered premises and seize and auction any moveable assets and distribute any cash proceeds to creditors in the form of dividends against the outstanding debt.

All fees arising from the enforcement will be borne by the debtor, and the applicant does not have to pay such fees.

Be prepared to apply for an execution order if the debtor doesn't comply with the judgment. Understand the enforcement process and potential asset seizure options.

• Creditor can file for liquidation or reorganization
• Specific timeline for court actions
• Appointment of trustee or administrator
• Suspension of debt settlements and legal actions

Should a debtor be unable to settle outstanding debts, a creditor may file a winding-up petition for liquidation or reorganisation with the people's court.

Upon filing for bankruptcy, the People's Court grants a notice of five days to the debtor to object to such an application. If appealed, the notice is submitted to the court within the following seven days to the People's Court to determine whether or not to accept the application within 10 days since the expiration of the objection term. The court will assign a licenced trustee or administrator upon this ruling.

The people's court will inform the creditors within 25 days after executing the ruling on its status.

After the people's court accepts the bankruptcy application, the debtor cannot settle specific debts to creditors and any ongoing collection activity or pending legal action is suspended. The trustee responsible may in some cases accept to resume certain collections or legal activity depending on the case, but only after acceptance of the bankruptcy and submission of claims from the creditors.

Understand the insolvency process and timeline. Be prepared for potential suspension of debt settlements and legal actions during bankruptcy proceedings.