Corporate verification and background checks that reveal who you are really dealing with — before you wire a deposit that may be impossible to recover.
The standard Chinese supplier payment model — 30% deposit upfront, 70% before shipment — means a foreign buyer routinely places six-figure sums in the hands of a company they have never visited, whose owners they have never met, and whose legal status they have never verified. The deposit is often the buyer's single largest exposure to a counterparty default.
Chinese company registration records are public, but they are in Chinese, hosted on government platforms that are difficult for non-Chinese speakers to navigate, and require interpretation — what does "registered capital of RMB 500,000" actually mean for a supplier claiming annual revenue of RMB 50 million? Does a clean business license mean a clean company? What about litigation history that does not appear on the business license?
Our due diligence service translates raw Chinese corporate data into actionable intelligence. We do not just retrieve records — we analyze them in the context of your proposed transaction and flag risks that a machine search would miss.
Key Insight: A Chinese company's business license is like a birth certificate — it proves existence, not good character. A supplier can have a valid, current business license while simultaneously being listed on the enforcement blacklist for unpaid judgments, having its bank accounts frozen, or being controlled by a different UBO than the one you are negotiating with. Due diligence must go well beyond the license.
Our due diligence covers eight core areas. The scope is tailored to your transaction size, industry, and risk tolerance:
Verification against the National Enterprise Credit Information Publicity System: registered name, unified social credit code, legal representative, registered capital, paid-in capital, business scope, establishment date, and registration authority.
Identification of all shareholders, their respective ownership percentages, and the ultimate beneficial owner(s). We trace through holding companies to identify the individuals who ultimately control the supplier.
Searches of China Judgments Online, the enforcement blacklist (失信被执行人), and local court databases for civil, administrative, and criminal cases involving the supplier and its key personnel.
Corporate credit reports from Chinese credit reference agencies, including payment history, debt levels, credit rating, and any defaults or delinquencies reported by financial institutions or trade creditors.
On-the-ground verification of the supplier's factory premises, production lines, workforce size, and equipment. We confirm that the facility shown in marketing materials actually exists and operates at the claimed scale.
Verification of claimed certifications — ISO, CE, FDA, UL, BSCI, and others — with the issuing bodies. We confirm that certifications are current, authentic, and issued to the entity you are contracting with.
Assessment of the supplier's standing in China's social credit system, including any negative records related to tax compliance, environmental violations, labor law breaches, or administrative penalties.
Mapping of the supplier's corporate group structure, identification of related-party transactions, and detection of shell companies or entities that may be used to shield assets from enforcement.
Some findings are deal-breakers. Others call for further investigation or contractual safeguards. Here are the most significant red flags we look for:
A sudden change in legal representative or major shareholders shortly before you sign a contract can indicate a distressed company being restructured — or a shell being prepared for abandonment. We flag changes within the last 12 months for investigation.
A supplier listed on the enforcement blacklist — or with multiple judgments against it — is unlikely to voluntarily satisfy an adverse award. Enforcement cases also indicate that the supplier's bank accounts may already be frozen or garnished by other creditors.
Chinese companies must register a "registered capital" amount, but the actual paid-in capital can be far lower. A company with RMB 10 million registered capital but only RMB 100,000 paid-in is thinly capitalized — a risk indicator for enforcement.
A supplier whose business license lists "textile trading" but is offering to manufacture electronics is operating outside its registered scope — which can create regulatory risk for both parties and may void insurance coverage.
Minimal registered capital, a virtual registered address shared by hundreds of companies, no employees on social insurance records, and no physical assets — these are the classic markers of a shell company with no real operating substance.
A supplier claiming ISO 9001 certification that does not appear in the issuing body's database — or a certification issued to a different entity than the one you are contracting with — is a serious integrity concern.
You provide supplier details and specific concerns. We agree on scope and timeline. Day 1
We search all relevant Chinese corporate, litigation, credit, and administrative databases. Days 2-4
Where requested, we arrange factory visits, local government record checks, and certification verification. Days 5-10
We deliver a bilingual report with findings, risk assessment, and recommended next steps. Days 10-14
Important: Online-only due diligence — searching databases without physical verification — can miss critical risks. A supplier's registered address may be a virtual office, the factory shown in marketing photos may belong to a different company, and the person you are negotiating with may not be authorized to bind the entity. On-the-ground verification adds cost but closes the most dangerous gaps.
A European startup was about to wire a $45,000 deposit to a Shenzhen electronics supplier found on Alibaba. Our DD revealed the supplier's business license had been revoked 18 months earlier for failing to file annual returns. The Alibaba store was operating under a canceled registration — the deposit would have disappeared into a personal account with no corporate entity to pursue.
A US importer was negotiating a $500,000 furniture order. Our litigation search found 14 active enforcement cases against the supplier totaling over RMB 8 million (approximately $1.1M), with multiple frozen bank accounts. The supplier had been using new customer deposits to pay old judgments — a classic Ponzi-like pattern. The buyer walked away.
A UK brand received impressive factory photos and video from a prospective garment supplier. Our on-ground visit found the "factory" was a 200-square-meter workshop in a residential building with 8 sewing machines — not the 200-worker facility depicted in marketing materials. The supplier was a trading company misrepresenting itself as a manufacturer.
A Middle Eastern buyer required ISO 9001 and ISO 14001 for a medical device supplier. The supplier provided certificates that appeared genuine. Our verification with the issuing body revealed both certificates were counterfeit — the certificate numbers belonged to a different company. The buyer avoided a regulatory compliance disaster in its home market.
Cost depends on the scope and depth of investigation. A basic corporate verification (business license, litigation search, credit report) typically starts from approximately $800-1,200. Comprehensive DD with on-ground factory verification and certification checks ranges from $2,500-5,000, depending on location and complexity. Contact us for a tailored quote based on your transaction size and risk profile.
Basic database searches can be completed in 3-5 business days. Comprehensive DD including on-ground verification typically takes 10-14 business days. We can accommodate urgent requests — contact us to discuss your timeline.
Some databases are publicly accessible, but (a) they are in Chinese; (b) search interfaces require Chinese-language input of the supplier's exact registered name; (c) interpreting results requires understanding of Chinese corporate and legal terminology; and (d) critical databases — such as certain local court records and credit reports — are not publicly accessible. DIY DD can miss risks that a professional review would catch. The cost of a missed red flag typically far exceeds the cost of professional DD.
Supplier resistance to DD is itself a red flag. Most of our investigation uses public databases and third-party sources — we do not need the supplier's cooperation to conduct core checks. However, if a supplier refuses to provide its unified social credit code or business license for verification, that is a strong signal to reconsider the relationship. Legitimate suppliers expect DD and cooperate willingly.
Yes. A supplier's circumstances change over time. A company that was clean when you started working together may have accumulated litigation, changed ownership, or fallen into financial distress. We recommend periodic re-screening of existing suppliers — annually for high-value relationships, or at minimum before placing a significantly larger order than your historical average.
Discrepancy between the supplier's claimed scale and its registered profile. It is remarkably common for a supplier claiming to be a large manufacturer to be registered as a small trading company with minimal capital, no manufacturing license, and a virtual registered address. This does not always mean the supplier is fraudulent — some legitimate businesses operate this way — but it materially affects your enforcement options if a dispute arises, because the entity you would sue may have negligible assets. This finding typically leads to a recommendation to restructure the relationship (different contracting entity, stronger payment protections, parent company guarantee).