Translating Contracts into Chinese Does Not a China Contract Make

Every few weeks one of our China lawyers will get an English or Spanish or German language contract sent to us by someone with the following question: “What would you charge to translate this for China?” We typically respond by asking whether they want a straight translation or whether they want us “to make the contract work for China” as well. Pretty much every time their response is something about how they would like us “to fix any problems you see while translating.”

For the few who want a straight translation, we provide them the names of good translation agencies, of which there are many. We also explain why it does not make sense to pay lawyer rates for a straight translation.

For those who want us to fix “any problems while translating”, we explain how that will require a lot more than just having one of our bilingual attorneys make corrections while translating. That will require our law firm first run a conflicts check to be sure we can represent them. Then it will require we gather up all facts relevant to the transaction and discuss the client’s goals related to the particular China transaction and their goals for China and, oftentimes, their goals for the rest of the world as well. We then explain that we may also need to do some legal research on China national and local laws and speak with Chinese government officials, depending on the nature of their contract.

We also usually explain why we so strongly recommend that our clients have us conduct basic due diligence on the Chinese party with which they want to contract, to make sure the Chinese company actually exists and is legally authorized to do the business it says it will do under the contract. We also want to make sure that our client’s IP is properly protected/registered in China (and often elsewhere) before they do any deal or sign any contract.

We then explain how when we are brought in as lawyers on a transaction, we frequently see a much better way to structure the transaction for our client, and oftentimes for the Chinese counter-party as well. Other times, we tell them that the deal they are seeking to do simply cannot work in China or that the contract they have is worthless for China and we will need to start over by drafting a new one. We also usually need to provide them with a China NNN Agreement to protect their IP and trade secrets before they reveal anything more to the Chinese company with which they are working. We also often explain the importance of liquidated damages for China contracts as a great example of why we must gather up a whole host of information before we can even begin drafting a China contract.

We have to do all of these things because contracts that work for the United States, Australia, Canada, Germany Spain, Mexico, etc., do not work for China and putting those contracts into Chinese will not change that. See Drafting China Contracts That Work.

Every so often the potential client will push back and ask a question or two that reveals they plan to move forward on their own, but still want our help to improve upon what they have already done. I have more than once been asked if I would “just explain how your law firm chooses the liquidated damages amount for your China Agreements” or “how your law firm chooses the jurisdiction for any contract disputes,” and then refer them to a good translator.

I usually respond by explaining the various reasons why I cannot answer those questions, which mostly center on the fact that we are not supposed to give legal advice to anyone who is not a client and how even if we could, we do not know anywhere close to enough about their situation to be giving such advice. I then send them a list of translation agencies and wish them the best.

Bottom Line:  Translating a contract into Chinese does not make it into Chinese contract.