Trade Advisory 2- DO's and DON'Ts for Indian Companies 09/07/2011
The Embassy has brought out a list of DOs and DON’Ts recommended for Indian companies interested in doing business with Chinese companies.
The list of DOs and DON’Ts is as follows:
i. Indian companies should run a preliminary internet check on the credibility of the Chinese company. Many a time complaints have been registered against such fraud companies by other affected parties.
ii. Indian companies are requested to check the credibility of the Chinese company on which they are placing import orders.
iii. Indian companies should insist on the copies of the passport/national identity card (issued by the Chinese Government) of the executives of the Chinese company with whom the Indian company is interacting. This would help to track down the offender in case they go absconding.
iv. Contracts entered with Chinese companies need to have arbitration clause and proof of existence (company registration document) should be certified by Embassy of India, Beijing or the relevant Consulate.
v. Quality / Quantity of any product to be imported from China to be physically certified by the Indian company either by visiting China or by appointing an agency.
vi. Refer your trade queries to the Embassy of India or the Consulate Generals of India instead of B2B companies.
vii. Most Indian companies have reported having faced problems dealing with businesses in Hebei (Shijiazhuang) and Tianjin. Indian companies desirous of doing business with companies located in these places are advised to be extremely cautious.
viii. Physical inspection of the goods to be carried out by the importing company at the point of loading in China.
ix. Release the remaining payment only after checking the quality of the consignment received in India
i. Indian companies are requested to desist from placing orders on Chinese companies listed on B2B sites in India and China.
ii. Never trust a Chinese B2B site which is just in English and has no Chinese version. Every website in China is inevitably in Chinese and sometimes, has an English version. A website only in English with no Chinese version is fraud.
iii. Advance payment through bank transfer is discouraged; unless the credibility of the Chinese company is proved beyond doubt.
iv. Do not release LC if not sure of the quality and quantity of the product.
v. Do not fall for offers of cheap products from the Chinese companies.