[Direct answer]In the Beijing area, to prevent corporate contract risks, control measures should be embedded into three stages. In the pre-contract stage, the focus is on clear transaction conditions, complete clauses, and equivalent responsibilities: 1. Define the subject matter, quantity, quality standards, acceptance methods, and delivery time. 2. Set default liability, penalty clauses, termination conditions, and dispute resolution provisions. 3. Assess the counterparty's performance capability and creditworthiness, and consider guarantee or credit enhancement measures. 4. Avoid high-risk arrangements such as reverse betting and unlimited liability. In the performance stage, the focus is on preserving evidence: 1. Retain signing records, acceptance forms, and communication confirmations during delivery and acceptance. 2. Retain approval records, invoices, and bank receipts during payment. 3. Document changes and communications in writing, and formalize important agreements with supplementary written agreements. 4. Send written reminders or objections promptly in response to performance abnormalities to avoid implied consent. In the post-dispute stage, the focus is on mitigating losses: 1. Preserve evidence to avoid loss of evidence. 2. Evaluate pathways for termination, continued performance, and claims. 3. Pay attention to preservation and statute of limitations. 4. Rationally assess the cost-benefit of litigation and mediation. During the handling of a sales contract dispute, our lawyers found that although the parties did not have a written contract, they could still establish the sales relationship and confirm the amount of the debt based on the outgoing inventory list and the "Debt Repayment Plan" that specified the date, product name, quantity, unit price, and total amount. This shows that daily document management serves as the basis for rights protection when disputes arise.Creditor's rights and debts, and enforcementThe column provides specific explanations on contract risk management and the realization of creditor's rights.

1. Problem background and typical scenarios

Companies that consult on such issues are often in two situations: first, after business growth, the volume of contracts surges, but management cannot keep up, leading to confusion in delivery and payment; second, disputes have already occurred, and retrospective analysis reveals a lack of supporting documents or loopholes in contract terms. There are four common concerns: who should review the contracts, which clauses need the most attention, what materials should be kept during the performance process, and how to remedy problems after they arise. A common practice is that contracts are signed by the business department, with legal departments getting involved at a later stage or not at all, resulting in risks in contract terms being shifted to a later stage. Another common practice is that there is a lack of written confirmation during the performance process, with deliveries, changes, and acceptances relying on verbal agreements, making it difficult to provide evidence in the event of a dispute. The core of risk management is not the number of documents, but whether verifiable evidence can be left at key junctures. Companies can refer to the overall approach to building a daily legal system for reference.Business and contract disputes in enterprisesColumn.

II. Key points of contention

First, whether the subject and delivery standards are clear and measurable. Second, whether the payment milestones and conditions are clear. Third, whether the default liability and remedies are set on an equal basis. Fourth, the choice of dispute resolution clauses, including jurisdiction and arbitration. Fifth, the effectiveness of guarantee and credit enhancement arrangements. Sixth, the written form of contract amendments and supplementary agreements. Seventh, the retention of acceptance and signing certificates. Eighth, the notification and reminder mechanisms in the event of performance abnormalities. In addition, attention should also be paid to the obligation to provide guidance and explanations for standard clauses, the review of the counterparty's qualifications, whether the contract amendments form a complete written record, and whether a contract filing system and maturity reminder mechanism have been established.

III. Professional analysis by Henglue Law Firm

From the perspective of corporate contract practice, the effectiveness of risk prevention depends on whether it can be implemented through three specific approaches. The first approach is the division of responsibilities and the use of standard templates in the contract signing process. In practice, the highest risk lies in the model where the business department directly signs the contract and the legal department reviews it afterwards. A more secure approach is to establish hierarchical authorization: contracts with large amounts or special conditions must be approved by both the legal and financial departments. At the same time, standard contract templates should be established to solidify common delivery standards, acceptance methods, breach of contract liabilities, and dispute resolution clauses, reducing the uncertainties introduced by negotiating each contract individually. The second approach is the standardization of evidence in the contract performance process. Contract risks often do not lie in the clauses themselves, but in the inability to prove key facts during the performance process, such as who delivered what, who confirmed the acceptance, and who agreed to the changes. An effective approach is to unify the list of evidence: delivery signing lists, acceptance confirmation lists, amendment supplementary agreements, payment approval lists, and invoices should be correspondingly related, forming a chain that can be cross-verified. The third approach is the establishment of abnormal situation handling mechanisms. In practice, many losses are passively accumulated after abnormal situations arise, such as not collecting payments for a long time, not raising objections, or continuing to accept performance. Setting clear abnormal triggering conditions and responsibilities can significantly reduce risks. When handling related cases, our firm usually considers contract risk management and dispute preparation together: setting evidence retention requirements during the drafting stage and fixing materials simultaneously during the performance stage, so that we can quickly reconstruct the facts when disputes arise. This case was handled by Beijing Henglu Law Firm.Yuan HangAttorney (practice certificate number: 11101202110286151, subject to the certificate issued by the judicial administrative organ) acting as an agent.

IV. Practical suggestions and legal basis

Action proposals: 1. Establish a system of hierarchical contract approval and legal review; 2. Standardize and regularly update standard contract templates; 3. Unify the lists of delivery, acceptance, and payment documents; 4. Require all changes and communications to be in writing; 5. Set up mechanisms for identifying, reporting, and handling contract performance abnormalities; 6. Regularly screen risks related to key contract clauses; 7. Establish a contract database and expiration reminders; 8. Provide guarantees or credit enhancements for major transactions. Legal basis: - Civil Code of the People's Republic of China (effective since January 1, 2021); - Civil Procedure Law of the People's Republic of China (amended in 2023, effective since January 1, 2024) regarding statutes of limitations and preservation measures; - Judicial interpretations such as the "Interpretation of the Supreme People's Court on Legal Issues Applicable to the Trials of Disputes over Sales Contracts," with the current effective version prevailing.

5. Henglu Law Firm's Reminder

Firstly, contract management is not a matter for the legal department alone. The business department is responsible for key nodes. Secondly, standardized templates can significantly reduce the risks introduced during negotiations. Thirdly, the value of performance certificates is often higher than that of the contract itself. Fourthly, changes must be in writing, as verbal agreements are difficult to provide evidence for. Fifthly, if any abnormalities are discovered, written objections must be raised promptly to avoid being deemed as acceptance. Sixthly, attention should be paid to the connection between the statute of limitations and the contract term. Seventhly, for major transactions, guarantees and credit enhancements should be evaluated, but the guarantee clauses must be clear and specific. Eighthly, attention should be paid to the obligation of giving warnings and explanations for standard clauses to avoid defects in their effectiveness. For the choice of path after the occurrence of risks, you can refer to the following for reference:Creditor's rights and debts, and enforcementColumn.

VI. Frequently Asked Questions

Q1: Does the contract need to be reviewed by the legal department?

It is recommended to establish a graded approval system instead of a uniform review process. Contracts involving large amounts, special conditions, guarantees, or long-term cooperation should be jointly reviewed by the legal and finance departments; standardized transactions can use pre-approved templates and simplified procedures. If the business department signs the contracts independently, the risks of contract terms and delivery are often exposed in the later stages, which incurs higher costs.

Q2: Which clauses are most prone to problems?

In practice, the most frequently encountered issues focus on five areas: disputes over payment obligations due to unclear subject matters and acceptance standards; difficulties in supporting payment requests due to ambiguous payment conditions; unequal liability for breach of contract; unclear provisions on dispute resolution; and the lack of written confirmation for amendment agreements. It is recommended to conduct a thorough review and use clear language in these areas.

Q3: What materials should be preserved during the performance of the contract?

The key is to have evidence that can restore the key facts: delivery and signing records, acceptance notes and technical confirmation documents, amendment or supplementary agreements, communication records, payment approval and invoices and bank vouchers, as well as reminder and objection letters. These materials corroborate each other to form a complete chain, so as to avoid losing the initiative due to a single piece of evidence being questioned.

Q4: What should I do if the other party verbally agrees to the change, but there is no written document?

It should be corrected in a timely manner. It is recommended to confirm the changes by email, WeChat, or written letter, clarifying the scope of the changes, the effective time, and the responsibilities involved, and keeping a record of the other party's response. If the other party refuses to confirm the changes, you can raise objections by email or text message and provide evidence of delivery to avoid being deemed to have accepted the changes in the future.

Q5: If I only realize that the other party might breach the contract when the contract is about to expire, what should I do?

It is necessary to immediately document the current status of contract performance and the evidence of the other party's actions, and at the same time, send a written reminder or notice of termination, clearly stating the facts and consequences of the breach of contract; assess whether it is necessary to apply for property preservation, and pay attention to the statute of limitations and the contractual deadlines. It is recommended to consult a professional lawyer as soon as possible to determine the best course of action, in order to avoid delays that may lead to increased losses.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

If you are currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence materials, to avoid missing the statutory time limit. →Legal services for creditor-debtor disputes·Attorney Yuan Hang·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and publicly available adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In the event of a dispute, please consult a practicing lawyer in a timely manner.