The situation
A Dutch consumer electronics importer had paid RMB 4.6 million in deposits to a Shenzhen supplier across two purchase orders for smart home devices. Shipments slipped twice, then communication stopped entirely. When the client's sourcing agent visited the factory, the leased premises were being emptied. Corporate records showed the shareholders had just begun transferring their equity to family members — a familiar pattern in the weeks before a supplier disappears. Every day mattered.
What we did
We treated the matter as an asset race, not a contract dispute:
- Same-week asset investigation. We pulled the supplier's corporate file, litigation history and enforcement records, and identified bank accounts, two vehicles and an equity stake in an affiliated trading company that could be reached.
- Pre-litigation asset preservation. We filed a preservation application with the competent Shenzhen court, posting security through a litigation preservation insurance policy rather than a cash deposit. The court issued the freezing order against the supplier's bank accounts and the affiliate equity within days of filing.
- Substantive claim. We then filed suit for termination of the purchase contracts and refund of the deposits, with statutory interest and damages, and put the equity transfers on notice as potentially revocable transactions.
- Pressure-led negotiation. With its operating accounts frozen and the equity transfer challenged, the supplier's legal representative requested settlement talks within three weeks.
The result
The case settled at mediation supervised by the court: RMB 4.2 million — 91% of the deposits — paid in two installments against a court-confirmed mediation statement, which is directly enforceable if breached. The first installment arrived eleven days after signing; the balance cleared within sixty days. Total time from first instruction to final payment was just under five months, without a full trial. The client's recovery exceeded its expectations by a wide margin; its own bank had advised writing the deposits off entirely.
The freeze was the case. Had the application been filed a month later, the accounts would likely have been empty and the equity beyond easy reach.
Results depend on the specific facts of each matter; past outcomes do not guarantee similar results.