How to verify a Chinese supplier

Why supplier verification in China is different

Verifying a supplier in most established markets is a matter of cross-checking a registry filing against a trading history. In China the registry layer is large, public, and reasonably accessible, but it sits above a more complicated reality. A licensed company can be a single-person shell with no premises. A genuine factory can be trading under three different names across three platforms, only one of which matches its licence. An English brochure name often has no direct legal counterpart in the Chinese registry at all.

That is the gap this guide is about. The point isn't that Chinese suppliers are uniquely risky: they aren't. The point is that the standard checks a buyer would run on a European supplier don't translate, and substituting them with a quick Alibaba lookup is the most common reason deals go wrong (our Alibaba supplier verification guide covers what the platform's badges do and don't tell you).

Step 1 · Get the legal Chinese name

Almost every verification problem starts here. The name printed on a Chinese supplier's English-language quotation, brochure or trading-platform profile is rarely the legal entity name. It is usually a brand, a translation, or a trading name chosen for international use. The only name that exists in the registry is the Simplified Chinese version on the company's business licence.

Before any other check, ask for a clear scan of the business licence (营业执照). It is a single-page certificate that displays:

• The full registered Chinese name
• The 18-character Unified Social Credit Code (USCC)
• The legal representative
• The registered address
• The registered capital
• The licensed business scope

A supplier reluctant to share this is a red flag in itself. A licence shared willingly tells you exactly which entity to look up next.

Step 2 · Check the USCC on the NECIPS portal

The National Enterprise Credit Information Publicity System (NECIPS, 国家企业信用信息公示系统) is China's official public registry, run by the State Administration for Market Regulation (SAMR). It is free to use and accessible from outside China. Search by the company's Chinese name or its USCC, and the entry confirms:

• Whether the company exists and is in active status (存续 / 在业)
• Date of establishment and registered capital
• Legal representative and key personnel
• Registered address and licensed business scope
• Annual reports filed (or not)
• Any operational anomalies, equity freezes or administrative penalties flagged by SAMR

Status terms to recognise: 存续 / 在业 means active. 注销 means deregistered. 吊销 means licence revoked: the company has not been formally closed but has lost its right to trade. A revoked supplier still listed on a sourcing platform is not unusual; it is also not someone you can safely contract with.

Step 3 · Confirm the business scope covers what you're buying

Chinese business licences specify a permitted scope of activity in some detail. A company licensed only for "domestic trade in clothing accessories" is not authorised to export industrial pumps, and the customs paperwork will reflect that. Mismatched scope is one of the more common ways a deal looks fine on paper and then collapses at the border.

Read the scope on the business licence (or the NECIPS entry) and check that it covers manufacturing or trading the goods you intend to buy, and that it includes import/export rights if you are receiving direct shipments. If the licensed scope and the actual order don't line up, you need to know which related entity in the group is doing the trade.

Step 4 · Look at registered capital with the right frame of mind

Registered capital used to be a meaningful indicator of substance. Since the 2014 reforms it is largely a declared commitment by shareholders rather than paid-in funds, and it can be set at almost any level. A company with RMB 10 million in registered capital may have RMB 10,000 actually paid in. Note, however, that under the revised Company Law (effective 1 July 2024) shareholders of an LLC must now pay their subscribed capital in full within five years of establishment (existing companies have until 30 June 2032 to comply), so registered capital can no longer be left largely unpaid indefinitely.

Use the number for what it still reveals: relative scale within an industry, whether the figure was recently adjusted downwards (which can signal distress), and whether the currency of the capital indicates a foreign-invested entity. Don't treat it as evidence of financial strength on its own.

Where independent checks stop being enough

The four steps above will weed out fictional companies, deregistered shells and obvious mismatches. They are necessary. They are not, on their own, sufficient for any commitment beyond a small first order. The public record will not tell you:

• Whether the registered address is a real operating premises. Industrial parks routinely host hundreds of registrations at a single address; manufacturing sites are frequently registered separately from their head office.
• Whether the company is actually trading at the scale claimed. Employee counts in annual reports are self-reported and often nominal. Reported revenue, where disclosed, is rarely audited.
• Litigation and enforcement history. Court records exist on the China Judgements Online platform (中国裁判文书网) and on the Supreme People's Court enforcement database (失信被执行人), but they are in Chinese, structured by case rather than by party, and incomplete at lower court levels.
• Beneficial ownership through layered structures. Direct shareholders are public; the ultimate human owners behind nominee shareholders, holding companies and offshore entities are not.
• Trading reputation in market. Local payment behaviour, supplier disputes, regulatory penalties below the SAMR threshold, and informal sector standing are not in any registry.
• The genuine relationship between the brand you're talking to and the legal entity invoicing you. Cross-border trade involving an unrelated trading company "fronting" for a different factory is widespread and entirely legal, but the credit exposure sits with whoever signs the contract, not with whoever makes the goods.

These are the questions a fresh, in-country investigation can help to answer. Public registry checks confirm a company exists, while a fresh investigation can reveal more about what kind of company it is.

What a China company report adds

A China company credit report is investigated by a local agent and can go beyond the public record. It allows for a combination of registry data with verification work that cannot always be done from outside China. Typical research and case-specific information can include:

• Confirmation that the registered address is a genuine operating site, not a virtual office
• Identification of the ultimate beneficial owners behind nominee or layered shareholdings
• Local-language court and enforcement record searches across the relevant jurisdictions
• Trade and credit references from suppliers and bankers (where available)
• An independent credit rating and calculated credit limit
• A risk assessment in plain English, suitable for a compliance or procurement file

Reports are delivered in English. The subject company is never informed an enquiry has been made. Turnaround starts at two working days.