The prevailing-language trap
Chinese courts and arbitral tribunals default to the Chinese version when parties execute bilingual contracts — and the divergence is usually found at the worst possible moment.
The wrong assumption: “Our global template in English is fine.”
When the two versions diverge — and they always do, in subtle ways — the interpretation favoring the Chinese-language reading often prevails. If you have signed only an English contract with a Chinese counterparty, you are litigating a document the tribunal may weigh against you.
The right approach: Negotiate a bilingual contract with a clear prevailing-language clause that both parties affirm — or accept, explicitly, that the Chinese version will control in PRC proceedings. Never let a counterparty “helpfully” translate your template into Chinese without you reviewing every clause.
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