It is difficult to get foreign products into China and then market, sell and deliver them. Using an experienced Chinese distributor is often the best way to quickly and relatively easily get foreign products into China and then sold in China.
Distribution contracts with Chinese companies are both similar to and different from US and EU distribution agreements. China law gives no special allowances to distributors so my law firm’s China lawyers draft our China distribution agreements to take advantage of this by providing for Chinese law in a Chinese court. We also do not bother with provisions that try to work around distributor protections because there are no such protections.
One big issue in China with nearly all distribution agreements is intellectual property protection. To “further” protect the IP of our clients, our China distribution agreements usually have what we call a “no registration” provision. In this provision, the distributor agrees that our client exclusively owns all trademarks or other IP that might be at risk, the distributor gains no rights to those trademarks, and the distributor will not register any IP in any way related to our client’s IP. We use the words “further protect” because the first line of protection for trademarks and other IP in China is registering them in China.
China’s Anti-Monopoly Law prohibits retail price maintenance — which includes requiring a distributor sell goods at a minimum resale price to third parties. Your China distribution agreements should therefore not require your Chinese distributor sell your goods at a certain price.
A distribution relationship with an experienced Chinese distributor and a China-specific distribution agreement may be just the solution for getting your product into China.
