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Tips on legal risk points of foreign-related enterprises

  1. There are many cases of using offshore companies to evade debts, and the identification of contract subjects involved in international goods sales contract disputes has increased. With the development of foreign trade and economic cooperation, there are more and more ways to transfer economic risks through the establishment of offshore companies. Some domestic enterprises that lack the concept of good faith have confused the foreign parties in the process of concluding the contract by registering multiple affiliated companies with similar names at home and abroad, in an attempt to evade legal liability in this way. If such cases are not handled properly, it will not only encourage some enterprises to evade and abandon their debts, but also affect the foreign parties’ confidence and determination in China’s investment and trade. In the trial of such cases, it is necessary to find out whether there is any confusion between domestic and foreign related companies in terms of funds, personnel and business, which is enough to affect the judgment of the contract counterpart on the contract subject, so as to confirm whether domestic companies and overseas related companies need to jointly bear contract responsibilities.
  2. Unjust enrichment disputes related to the international sale of goods have increased, and the risk prevention awareness of the contract subject needs to be strengthened. In the international trade of goods, it is normal to conclude contracts through the Internet and e-mail. In many cases, the payer paid the payment to a third party according to the payment instructions in the e-mail, while the actual payee did not know and did not send the payment instructions. The characteristic of such cases is that the email address of the person issuing the payment order is very similar to the email address of the opposite party of the transaction, and there is usually a letter difference. Once the payer does not carefully check and identify, it is easy to misoperate due to misleading. Once the wrong operation, it will lead to huge losses and difficult to claim. Therefore, it is suggested that the commercial subject should improve the awareness of risk prevention and carefully check the email address in the actual performance of the contract to prevent the disputes of unjust enrichment.
  3. Disputes involving foreign product quality and foreign construction projects have increased, and it is difficult to guarantee rights because there are no agreed quality standards and no timely fixed evidence. The evidence formed outside the country should be certified by the notary organ of the country where it is located and authenticated by the Chinese embassy or consulate in that country, or the certification procedures stipulated in the relevant treaties concluded between China and the country where it is located should be performed. Domestic cases can complete the evaluation and identification of quality and price through the judicial expertise evaluation procedure, and then allocate responsibility. However, due to geographical restrictions and the timeliness of product quality inspection, it is difficult to complete the corresponding evaluation and appraisal in domestic judicial procedures involving foreign product quality disputes and foreign construction project disputes. Therefore, in addition to clearly agreeing on the corresponding quality standards in the contract, the parties should also timely notify the other party of the contract when the problem occurs, and use the authority to notarize and fix the corresponding quality problems. For the project cost In the process of performing the contract, timely check and sign for confirmation of engineering quantity accounting and other issues, so as to prevent claims from being groundless.
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