Canton Fair Deals: Seven Practical Legal Checks — Part 4

A buyer sends a product image to a Chinese factory and says: “Make this. I will cover any IP claims.” Does that settle the factory's risk?

An indemnity and permission to use intellectual property answer different questions. Identify the rights involved: branding, product appearance and artwork may raise different trademark, design-patent and copyright issues.

Check who owns the relevant rights and whether the buyer can arrange this particular production. A distribution licence may not cover manufacturing. Review the product version, duration, manufacturing arrangements, destination markets and any subcontracting.

Assess manufacturing in China and the intended sales markets separately. Neither “export only” nor removal of a logo provides a universal answer to every IP issue. Similarity alone is not a complete infringement analysis either.

The contract can address document delivery, verification, disputed claims, costs and losses. It cannot, merely by agreement between buyer and factory, extinguish a third party's lawful rights. Recovery under an indemnity also depends on its terms, applicable law, evidence and the other party's ability to perform.

For a specific review, agree the scope and fee first; substantive review follows payment.

Mike Wu | China-licensed cross-border attorney | Guangzhou | wzklaw.com/contact.php?source=linkedin