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Pitfall 21: Shell or Subsidiary Structures

Part 21 of 21 Pitfalls to Avoid When Sourcing from China.

The Pitfall

Apparently independent factories are actually subsidiary shells shielding a parent company.

Why It's Dangerous

When things go wrong, the shell has no assets and the parent is shielded from liability.

How to Avoid It

Investigate the corporate structure and ownership before contracting.

Sourcing from China? Get it right from the start.

Our Chinese lawyers review suppliers and contracts before you commit — and recover your losses if a deal goes wrong.

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