Four tips on when to use a Demand Letter to protect your business interest

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Written on: January 3, 2023

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Demand Letter

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Demand letters are very common in commercial legal disputes for businesses in countries such as Canada and the United States, and they rarely cause much concern for their recipients. In China, however, lawyer demand letters (often called “lawyer’s letters”) are much less common, meaning they are viewed much more seriously, and people generally respond to them with more urgency. When should you engage a lawyer to send a demand letter to your exporter in China? 

1. To demand something from the other business

As their name suggests, demand letters should be used if you find that the opposing party is infringing on your rights somehow and to cease the infringement. For example, the exporter may use your brand in a way you have not agreed upon. You can also demand that the exporter stop an illegal activity that may impact the transaction, such as breaking environmental laws during its manufacturing process. You can also demand that the exporter implement specific legal obligations that it has to you. These might include paying you on time as agreed to in the contract. 

2. To warn the other party

Letters from your lawyer can also be used to notify the opposing party of legal risks and potential infringements from their practices, as well as the liabilities and consequences that can arise from these infringements. This type of warning will help discourage actions that may lead to serious legal consequences. 

3. To declare legal information to the other party 

Although a good sales contract will contain all the information the other party should know about the transaction, it can sometimes be helpful to issue a declaration to the other party in order to clarify your lawful rights and legal position, as well as the limitation of actions they may carry out. 

4. To inquire with the other party about their position and response 

A demand letter may also be used to ask for a response to the legal position and demands put forth in the letter. This can be the initiation of a negotiation, and a well-drafted demand letter will usually lead to a successful negotiation that does not need to resort to expensive litigation. 

While countless sample demand letters can be found on the internet, we recommend getting an experienced lawyer to draft one tailored to your business needs to be effective and eliminate the legal problem you’re facing. 

Trustiics offers a quick and convenient demand letter service – our experienced China lawyers will draft both English and Chinese versions of a demand letter in just 5 business days!

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