Keep purchase documents and supplier details for every batch; suspiciously cheap goods can expose the owner even when staff bought them

Free. Retain purchase contracts, invoices, payments, supplier licenses and authorizations for every batch. Require purchasers to sign and reject prices clearly below market without justification. Passing up apparently high-margin bargains is the challenge.

Knowingly selling goods bearing counterfeit registered trademarks reaches the criminal threshold at RMB 30,000 illegal proceeds or RMB 50,000 sales, carrying up to 3 years and/or a fine. Ten times those thresholds brings 3–10 years plus a fine. Unsold stock worth at least three times the sales threshold can also constitute the offense. The 2025 Supreme Court/Procuratorate interpretation lists five grounds for finding knowledge unless contrary evidence establishes lack of awareness: knowing a registered mark was altered, replaced or covered; forging or altering authorization, or knowing it was forged/altered; reselling the same kind after previous criminal/administrative punishment; purchasing or selling far below market without justification; or moving/destroying infringing goods, accounts or other evidence, or supplying false proof after authorities discover the conduct. Corporate offenses bring a company fine and the same statutory punishment for responsible managers and directly responsible staff. Thus a staff purchase can expose the decision-maker. Conversely, China's Trademark Law exempts a seller from damages if genuinely unaware of infringement and able to prove lawful acquisition and identify the supplier. Documents determine whether this route is available. The judicial interpretation took effect April 26, 2025 nationwide in China.

Cosmetics, alcohol, mother-and-baby products, electronics and clothing are common categories because identical-looking goods can have wide price gaps. “Special channels,” “factory leftovers” and “overseas duty-free” do not replace paperwork. Administrative penalties can also confiscate goods and tools and impose up to five times unlawful business value where it reaches RMB 50,000. If suspicious stock is already purchased, stop sales, preserve it and contact the brand or market regulator; destroying goods or accounts falls directly within the fifth inference-of-knowledge category. For designs, see entry 21. One reported tactic is offering free pens or small goods on a profit-sharing basis, then buying and documenting them for infringement claims. Such stock can lack purchase/payment records, an identifiable real supplier and a normal price, undermining lawful-source defenses. Do not stock unsolicited undocumented goods supplied only with a WeChat contact. Genuine consignment needs a written contract, supplier identity and business-license copies, and terms identifying ownership and infringement responsibility.

NPC Standing Committee (2020). Criminal Law Amendment XI, items 17 and 24, amending Articles 214 and 220. https://www.spp.gov.cn/zdgz/202012/t20201227_503682.shtml; Supreme People's Court and Supreme People's Procuratorate (2025). Interpretation on Criminal Intellectual Property Infringement Cases, [2025] No. 5, effective April 26, 2025. https://www.spp.gov.cn/xwfbh/wsfbt/202504/t20250424_693977.shtml; NPC Standing Committee (2019). Trademark Law, 2019 amendment, Articles 57 and 64; renumbered Articles 72 and 78 in the June 26, 2026 revision effective January 1, 2027. https://www.cnipa.gov.cn/art/2019/7/30/art_95_28179.html, https://www.cnipa.gov.cn/art/2026/6/26/art_95_206942.html