Get a written contract before prepaying, and seek unused balances when the business cannot perform
Chinese businesses taking advance payment must provide written terms, including refunds. Serious operating risks require them to stop taking prepayments, and closure or relocation requires advance notice. You may demand continued performance or return of the unused balance. Violations can bring fines.
What it takes
Free. Insist on written terms before paying, despite pressure to top up first.
What you may gain
China's consumer-protection implementing regulation requires a written contract for prepaid goods or services, including refund methods. Major operating risks that threaten delivery require a halt to new prepayments; intended closure or relocation requires advance notice. Consumers can request performance or return of unused funds. Applicable penalties include fines of 1–10 times unlawful gains, or up to RMB 500,000 where there are none.
Context & considerations
Legal rights help with recovery but cannot prevent a disappearance; funds may already be gone. First limit prepaid amounts, then use the law if needed. Article 27 also requires deposit-return methods, procedures and deadlines to be agreed in advance and prohibits unreasonable refund conditions.
Research & references
State Council of China (2024). Regulations Implementing the Consumer Rights Protection Law, Order No. 778, effective July 1, 2024. Article 22 requires written terms on goods/services, prices, refunds and breach liability; performance or refunds where agreed service is not delivered; cessation of prepayments under major operating risk; advance closure/relocation notice; and consumers' right to performance or unused-balance refunds. Article 50 provides penalties. https://www.gov.cn/zhengce/zhengceku/202403/content_6940159.htm