Suing a Chinese Supplier: What It Costs and What Comes Back

Posted October 11, 2026 · By Li Xinlei (Aaron Li), Partner, H&C (Jinan) Law Firm

The question buyers ask before they ask anything else is whether it is worth suing a Chinese supplier. It is the right question, and it has an answer that is mostly arithmetic. Chinese litigation is cheaper than most foreign buyers expect at the filing stage and more expensive than they expect at the security stage; legal fees are largely not recoverable; and the outcome depends far less on the strength of the claim than on whether the supplier still holds something a court can take. This article sets out the numbers rather than the procedure.

The short answer

For a claim with assets behind it, a China-side claim is usually worth pursuing above roughly USD 10,000 to USD 20,000. Below that figure the fixed costs of a properly run claim — translation, notarisation, filings, preservation security and legal work — frequently exceed what is recoverable. Where the supplier holds no reachable assets, the strength of the claim does not change the arithmetic, and the honest advice is not to spend.

The four costs, and which ones you control

Costs in a China-side claim fall into four groups, and they behave differently.

Court and preservation fees are set by a published national scale. They are modest, predictable, and not negotiable.

Preservation security is the largest controllable item and the one that most determines whether a claim is worth bringing. Without it, a judgment is often just a document.

Legal fees are largely not recoverable, which is the opposite of what most common-law buyers assume.

Translation, notarisation and legalisation are small individually and material in aggregate, because every document used in a Chinese court must be in Chinese.

Court acceptance fees: how the scale actually works

Property claims are charged on a progressive scale applied to the amount claimed, each band charged separately on the portion that falls within it (Article 13(1) of the Measures for Payment of Litigation Costs, State Council Decree No. 481, in force since 1 April 2007). The full domestic scale is:

A worked example makes it concrete. On a claim of RMB 1,000,000:

The scale then keeps rising, but more slowly. These are the totals for larger claims, useful for sizing a matter before it is filed:

The claimant prepays the acceptance fee on filing. If the claim succeeds, the losing party normally bears it (Article 29); if the case ends in settlement or the claim is withdrawn, the acceptance fee is halved (Article 15). Filing is not where a China-side claim becomes expensive.

Preservation: a cheap fee and an expensive security

The application fee for asset preservation is capped and small. Under Article 14(2) of the same Measures, it is RMB 30 where the amount preserved is up to RMB 1,000 (or no amount is involved), then 1% on the portion from RMB 1,000 to RMB 100,000 and 0.5% above that, with a maximum of RMB 5,000 per application. On a preservation of RMB 1,000,000 the fee is therefore the full RMB 5,000 cap. The fee is not the cost.

The cost is the security the court requires in case the preservation turns out to have been wrongful. The rules differ depending on when you apply. Where you apply before proceedings, the security must normally cover an amount equivalent to the full sum for which preservation is sought — the full amount claimed, not a fraction (Article 5(2) of the SPC Provisions on Property Preservation, Judicial Interpretation No. 21 of 2020). Where you apply after the case has started, the security is capped at no more than 30% of the sum sought (Article 5(1) of the same Provisions). That gap — the full sum against a 30% cap — is why most buyers apply after filing rather than before, even though pre-filing freeze gives the strongest tactical surprise.

Tactical surprise has a price, in other words, and it is paid in cash or insurance.

Buyers rarely post cash. The usual route is litigation preservation liability insurance, where an insurer posts the security and the buyer pays a premium. That premium is not set by any published scale: it is a commercial quotation, priced case by case against the amount secured and the risk the insurer is taking. The point for budgeting is the shape of the cost, not a rate — the premium is modest against the sum it unfreezes, and it is the expenditure that makes the rest of the exercise worth doing. A freeze applied before the supplier knows a claim exists is frequently the difference between a judgment that collects and a judgment that is framed.

Two further points on cost and time. The preservation application fee is borne by the applicant and is not, as a rule, shifted to the losing party — but if you go on to sue, you can include it in your claim (Article 38(3)). And a freeze is not permanent: under Article 485 of the SPC Interpretation on the Civil Procedure Law, bank deposits are frozen for no more than one year, movable property seized or distrained for no more than two years, and real property or other property rights for no more than three years, each renewable on application before it lapses. Budget for the renewals on a long matter, because a freeze that lapses quietly is worth nothing.

Legal costs: the part buyers expect to get back

This is where expectations are most often wrong. In Chinese practice, each party generally bears its own legal costs unless the contract provides otherwise or a specific rule allows recovery. A buyer who spends on Chinese counsel and wins on the merits should not assume those fees come back.

The practical consequence is twofold. First, budget legal fees as a cost, not as a recoverable item. Second, if you are still at the drafting stage, put an express costs clause in the contract — a tribunal or court that is given the power to shift costs is far more likely to use it. How to draft that clause so it is enforceable is dealt with in an arbitration clause that holds up in a Chinese court.

Translation, notarisation and legalisation

Every document a Chinese court relies on must be in Chinese, translated by a qualified translator. A foreign corporate claimant will also need its identity documents and the power of attorney notarised and legalised or apostilled. These are individually modest items, but they are unavoidable, they scale with the size of the documentary record, and the notarisation step commonly takes two to four weeks — which means it sits on the critical path and should be started before it is needed.

The clock

Time is a cost even when it does not appear on an invoice. First-instance civil proceedings in China run to a six-month limit that is routinely extended, and foreign-related matters take longer because of translation, service and authentication steps. Once judgment is obtained, a separate enforcement application follows. In matters I see, the realistic range from filing to money is measured in years rather than months, and it is longer where preservation was not obtained and the debtor has time to move assets.

Enforcement: the second fee you must budget for

A judgment is not money. If the supplier does not pay, a separate enforcement application follows, and it carries its own fee, again payable up front by the applicant and, if the enforcement succeeds, borne by the debtor (Article 38(1) read with Article 29). Under Article 14(1)2 of the Measures the scale is: RMB 50 where the sum enforced is up to RMB 10,000; 1.5% on the portion from RMB 10,000 to RMB 500,000; 1% from RMB 500,000 to RMB 5,000,000; 0.5% from RMB 5,000,000 to RMB 10,000,000; and 0.1% above RMB 10,000,000.

On a RMB 1,000,000 judgment, enforcement costs RMB 12,400 — comparable to the acceptance fee for the litigation itself. This is the item most often left out of a pre-filing budget, and it is the item that turns a theoretical win into a real cost.

What comes back

Where the break-even line sits

Combining the fixed costs — translation, notarisation, filings, insurance premium, and counsel's work — the arithmetic in practice produces three bands:

• Below roughly USD 10,000: a properly run China-side claim will often cost more than it returns. The rational actions are a firm bilingual demand letter, a platform dispute if one is available, and a written record.
• USD 10,000 to USD 50,000: viable if there is a specific asset lead. Without one, the asset investigation becomes the project, and its cost has to be justified before the claim is filed.
• Above roughly USD 50,000: usually worth pursuing, and the first question changes from "should we sue" to "where are the assets and how fast can they be frozen".

The number that should drive the decision is not the size of the loss. It is the size of the loss multiplied by the probability that the supplier still holds reachable assets — and that probability is established by investigation, not by argument. If enforcement of a judgment obtained elsewhere is the route you are considering, the cost picture is materially worse, as explained in why a foreign judgment will not reach a Chinese company's assets.

Frequently asked questions

How much does it cost to sue a Chinese supplier?

The court acceptance fee is scale-based and modest — RMB 13,800 to file a one-million-RMB claim, rising to RMB 81,800 on a ten-million-RMB claim. Preservation security is the material cost, and it is where the timing decision matters: security is capped at 30% of the sum sought if you apply after filing, but must equal the full sum if you apply before. Legal fees are the largest variable and are generally not recoverable from the losing party, and enforcement of the judgment carries a further fee (RMB 12,400 on a one-million-RMB judgment).

Will I get my legal fees back if I win?

Not by default. Chinese practice is that each side bears its own legal costs unless the contract provides for recovery or a specific rule applies. An express costs clause in the contract is what changes this.

Can I recover the deposit without going to court?

Often, yes — a firm bilingual demand letter sent to the registered address is the highest-yield step in the sequence, and settlement at that stage removes the enforcement question entirely. The sequence is set out in how to recover money from a Chinese supplier.

Is it cheaper to arbitrate than to litigate?

Not necessarily, and the comparison is not mainly about fees. Arbitration usually costs more in tribunal fees but produces an award that travels under the New York Convention, which matters when the debtor's assets are in China. Choose the route for enforceability, then price it.

Establish the numbers before you commit to a claim

Send me the contract, the payment records and whatever you know about the supplier's assets. You will get a written view of what a claim would cost, what is realistically recoverable, and whether the loss falls on the side of the line where pursuing it makes commercial sense. What comes back cannot be known in advance — it depends on assets and evidence — but the arithmetic can be done before you spend on it.

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About the author

Li Xinlei (Aaron Li) is a partner at H&C (Jinan) Law Firm in Jinan, Shandong, where he acts for foreign companies and individuals in international trade disputes, cross-border enforcement and construction claims. He has five years of international engineering and market development experience in the Middle East and South Asia, and writes on China trade lawyer practice for buyers rather than for search engines.

Originality statement: This article is based on matters handled by the author and is intended to provide general legal information and practical reference. For reprinting or citation, please indicate the original source (this website link / article link) and the author's information. We respect original creation and knowledge sharing, but firmly oppose any form of infringement.

Disclaimer: This article provides general legal information and does not constitute legal advice for any specific case. Fee scales, security requirements and time limits are set by law and practice and change over time; the figures shown follow the national scale in the Measures for Payment of Litigation Costs (State Council Decree No. 481) and related judicial interpretations in force at the date of writing, but are illustrative and the court's assessment in your matter will govern. Please consult and appoint a qualified lawyer for your own case.