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Notarisation fees for business contracts: necessity or scam?

The EU SME Centre has received a few enquiries from EU SMEs which were asked, by a Chinese business partner, to pay notary or other administrative fees right before signing a business contract – in the majority of cases a sales contract. The fees would not be paid directly to the notary, but to the local Chinese company which would in turn ‘arrange’ or ‘take care of everything necessary’, sometimes ‘showing good will and accept to share the fees together’.

According to Chinese law and regulations, there is no mandatory provision to notarise ordinary sales and purchase contracts. This requirement exists only for some contracts of special importance, as for example real estate transfers. Moreover, even if both parties agree on the notarisation of a contract, the physical presence of both parties in the notary office is required, otherwise it will be impossible to notarise a signature.

In one specific case received, one EU SME received an unsolicited request from a Chinese company for the purchase of some products. The contract signed indicated that ‘notary fees’ and ‘foreign currency exchange fees’ would need to be shared by both parties to validate the contract. The EU SME paid the fees to the Chinese company, which then disappeared without proceeding with the purchase of the EU SME’s goods as agreed.