Top 5 Certificates You Should Request Your Chinese Supplier to Provide
In the previous article, we discussed a questionnaire survey among users on our website to find out whether or not they trust suppliers found on famous B2B platforms like Alibaba. Obviously, requiring Chinese supplier to provide some key registration documents, certifications and reports is a simple but effective form of due diligence.
Genuine Chinese businesses who are keen to work with you will be happy to provide these China supplier documents. Verifying that they are authentic will give you confidence that you are dealing with a trustworthy company.
On the other hand, if a Chinese supplier is unwilling to provide you with these simple documents, or worse still, provides you with fake documentation, it is a clear sign that you should take your business elsewhere.
Let’s see TOP 5 documents you should request your Chinese supplier to provide. However, in all cases it is important to verify that certificates are genuine.
- Business License
- Name in Chinese: 营业执照
- Purpose: to prove that the company is legally registered in Mainland China
All companies in Mainland China must be registered and have this business license through which they are assigned an 18-digit business license number.
Being China’s principle company certificate, it is very widely requested, so any resistance from the Chinese supplier to providing a copy can be a useful early warning sign.
Once you receive the certificate make sure you review it carefully. In addition to finding many fakes, we have also encountered many cases where business licenses from Hong Kong or offshore jurisdictions such as the British Virgin Islands or Cayman Islands have been provided.
- Bank Account Certificate
- Name in Chinese: 开户许可证
- Purpose: to get details of the company’s official Mainland China bank account
Only making payments to the account displayed on a Mainland Chinese company’s licensed bank account certificate is a good way to avoid some of the more blatant kinds of scams and fraud out there.
This certificate proves that they are the genuine holder of the business bank account shown on the certificate, and you can be confident that payments to this account are actually going to that company.
Doing this ensures that payments aren’t going to a personal account or an offshore account from which the money might “disappear”. There are also many more protections and restrictions on licensed business bank accounts, so you’re safer in that respect, too.
Again, though, there are caveats. Most companies in China operate several bank accounts, for example to handle different currencies or different aspects of business.
In these cases, it is likely that only one account will actually have a license associated with it. There is not necessarily anything untoward about this situation, what’s more important is that you always pay to onshore business accounts and not to personal accounts.
- Foreign Trade Registration Certificate
- Name in Chinese: 对外贸易经营者备案登记表
- Purpose: to ensure company is registered for foreign trade and to confirm their official English name
The China foreign trade registration certificate is required for companies which are directly engaged in importing and exporting, so it’s not required for all companies in China.
If your Chinese supplier doesn’t possess this certificate they will likely be using a trading company to send your products. Whilst not necessarily a problem, this is something to be aware of.
As part of the registration process, the company is required to specify their English name for the purposes of foreign trade when they register with the Ministry of Commerce (MOFCOM).
In most cases this English name should correspond with the name on the bank account you are being asked to make payment to.
- ISO 9001 Certificate
- Name in Chinese: ISO9001质量管理体系证书 (English language certificates are usually provided)
- Purpose: to ensure the organization has a certified quality management system, the scope of which covers the product you are buying
Requesting a copy of a Chinese supplier’s ISO 9001 certificate is a useful step to take before placing any orders with them. An ISO 9001 certificate demonstrates that a Chinese company has implemented an adequate system for:
- Quality management
- Management responsibility
- Resource management
- Product realization
- Measurement, analysis and improvement
- plus much more…
An ISO 9001 certificate is issued for a specific scope and this scope identifies the products and services the certification covers. This is very useful for determining if the supplier genuinely manufactures the product you require.
As always, there is the potential for deception, so viewing the certificate is not enough. You need to identify the ISO 9001 registrar that granted the certificate (this will be given on the document), and independently confirm with that registrar that the company is genuinely certified.
It’s also important to confirm which sites a supplier actually holds ISO 9001 certification for; they may hold certification for some factories, but not for others. Further, it’s wise to confirm that the registrar that issued the certification is itself accredited.
- Customs Registration Certificate
- Name in Chinese: 进出口货物收发货人报关注册登记证书
- Purpose: to determine whether the company is registered to make customs declarations with China customs
Although often confused with the foreign trade registration certificate, the customs registration certificate actually serves quite a different purpose.
This certificate is provided to Chinese suppliers who are registered with China Customs to make customs declarations.
Most major manufacturing companies will possess this certificate, but many smaller businesses use brokers to assist with the process.
It is less common for companies to possess this certificate than the foreign trade registration, but still useful to request it in order to better understand their capabilities.
Investigating into Chinese Suppliers