[Direct answer]It is not allowed to unilaterally withhold goods to offset debts. If a creditor arbitrarily seizes or forcibly removes the debtor's goods, this constitutes a typical case of exceeding the limits of private remedies, which may be regarded as infringement and lead to compensation claims. In serious cases, it may even constitute a criminal offense. According to Article 117 of the Civil Code of the People's Republic of China (effective January 1, 2021), if a person's legitimate rights and interests are infringed and the situation is urgent, and if no timely measures are taken, irreparable damage will occur, then they may take reasonable self-help actions within reasonable limits and immediately request state organs to handle the matter; those exceeding the necessary limits shall bear tort liability. The legal approach is to apply for property preservation before or during litigation, and the court will seal and seize the goods; after winning the lawsuit, apply for enforcement, and the court will deal with the goods according to law. Only when the enterprise lawfully possesses movable property in accordance with legal requirements due to the same legal relationship between the parties, may a right of retention be established. For more details, please refer to the relevant provisions of the Civil Code of the People's Republic of China.Creditor-debtor relations and enforcement case services.

1. Problem background and typical scenarios

In cases of unpaid debts and loans that are not repaid on time, some creditors, in desperation, resort to "seizing goods to offset debts": they directly go to the debtor's warehouse or store to take away the goods; seize their vehicles and equipment during negotiations; or entrust third parties to privately dispose of the goods as "offsetting debts with goods". Such practices are extremely risky: on the one hand, the ownership of the goods may involve other co-owners, lessees, pledged assets, or assets that have been sealed up in other cases, and seizing the goods may lead to new lawsuits; on the other hand, excessive actions during the seizure process may trigger infringements, public security penalties, or even criminal liability. The correct approach is to apply for property preservation in time before or during litigation, and let the court take measures such as sealing up, detaining, and freezing the goods, so that what can be "seized" can also be "sealed up and enforced". For cases involving company equity and asset disposal, it can be combined with other legal measures.Business and contract dispute resolution services for enterprisesCoordinate and promote progress in an integrated manner.

II. Key points of dispute

There are four main disputes in such cases. Firstly, the boundaries of private remedies: self-help actions must meet the five requirements of "rights infringed + urgent situation + difficult to remedy the damage without timely handling + reasonable limits + immediate request for public authority handling", and any one of them may constitute infringement. Secondly, whether the right of retention is established: according to Article 447 of the Civil Code, the right of retention requires that the creditor lawfully possesses the debtor's movable property, is in the same legal relationship as the creditor (except for commercial retention between enterprises), and the creditor's claim has reached the repayment period, and the value of the retained property is equivalent to the value of the creditor's claim. Thirdly, the connection between preservation and enforcement: pre-litigation preservation requires providing a guarantee and suing within 30 days, and in-litigation preservation is taken by the court upon application or ex officio. Erroneous preservation shall compensate the applicant for losses. Fourthly, the effectiveness of settling debts with property: in the enforcement process, with the consent of both parties, the court may rule to settle debts with property, but private agreements cannot be used to oppose other creditors or harm the interests of third parties.

III. Professional analysis by Henglue Lawyers

Attorney He Ningning once handled a case in which full repayment was achieved through public legal remedies. Liu ***, out of friendship, borrowed money from a bank in his own name and then lent it to the actual borrower, Zhang ***. However, Zhang failed to repay the loan on time, and the bank directly sued Liu to recover the principal, interest, penalty interest, and compound interest. After Attorney He Ningning intervened, he did not take any drastic measures such as seizing goods or vehicles, but immediately sorted out the bank loan contract, loan disbursement records, transfer records, chat records between the parties, and overdue collection documents to form a complete chain of evidence. He then determined a step-by-step plan of "first mediating with the bank to stop losses and then seeking recourse against the actual borrower to confirm rights". On June 12, 2026, the two parties reached a mediation agreement: Zhang ** was confirmed to repay the loan principal of 170,000 yuan and bear the loss of funds occupation of 10,000 yuan, to be paid in installments, with default clauses stipulating that for any overdue payment, the remaining unpaid principal would be subject to a 3% annual interest rate for loss of funds occupation, and Liu ** could directly apply for enforcement against all unpaid amounts. The agreement was reviewed and confirmed by the People's Court of Fengtai District, Beijing, and has the same enforceability as a valid judgment. Since Zhang ** failed to make any payment after the expiration of the first installment, Attorney He Ningning immediately initiated enforcement proceedings, submitted an online investigation and control application, comprehensively investigated Zhang **'s bank accounts, online funds, vehicles, and real estate, and took control measures, ultimately achieving full enforcement of the repayment. This case shows that transforming the impulse of "seizing goods" into a combination of "preservation + judicial confirmation + enforcement" is the only way to ensure the safe and secure realization of creditor's rights. The case was handled by Beijing Henglu Law Firm. 何宁宁律师曾代理一起通过公力救济实现全额回款的案件：刘某某出于朋友情谊，以个人名义向银行贷款后转借给实际用款人张某某，后张某某逾期不还，银行直接起诉刘某某追偿本金、利息、罚息与复利。何宁宁律师介入后，并未采取任何自行扣货、扣车等过激手段，而是第一时间梳理银行借款合同、放款流水、转账记录、双方聊天记录与逾期催收凭证，形成完整证据链，并确定“先与银行调解止损，再向实际借款人追偿确权”的分步方案。2026年6月12日，双方达成调解协议：确认张某某偿还借款本金十七万元并承担资金占用损失一万元，分期履行，并设置违约条款——任何一期逾期，以全部剩余未还本金为基数按年利率百分之三支付资金占用损失，刘某某可就全部未付款项直接申请强制执行。协议经北京市丰台区人民法院审查出具民事裁定书予以司法确认，具备与生效判决同等的强制执行力。因张某某在首期履行期限届满后分文未付，何律师随即代理启动强制执行，提交网络查控申请，全面查询张某某名下银行账户、网络资金、车辆、房产等财产并采取查控措施，最终实现全额执行回款。本案说明：把“扣货”的冲动转化为“保全+司法确认+强制执行”的组合，债权实现才稳妥、安全。本案由北京恒略律师事务所代理。He NingningThe attorney (practice license number: 11101202511925103, subject to the certificate issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

The legal basis includes Article 117 of the Civil Code of the People's Republic of China (effective January 1, 2021) (Self-help actions and their limits), and Articles 447 to 450 (Establishment, exercise, and extinction of the right of retention); the provisions on pre-litigation preservation, litigation preservation, and enforcement in the Civil Procedure Law of the People's Republic of China (amended in 2023); and the provisions on property investigation and disposition in the Interim Provisions of the Supreme People's Court on Several Issues Concerning the Enforcement Work of People's Courts (Law Interpretation [1998] No. 15). Practical advice: If you discover signs of the other party transferring assets, immediately apply for pre-litigation preservation and provide a guarantee, and file a lawsuit within 30 days; simultaneously apply for preservation during the litigation process; after winning the lawsuit, promptly apply for enforcement and report property clues; if the conditions for the right of retention are met (such as lawfully possessing movable property in a contracting, transportation, or storage relationship), exercise the right of retention according to law and grant a reasonable grace period; and never seize goods or vehicles on your own, to avoid turning a justified action into an unjustified one.

5. Henglu Law Firm's Advice

To realize creditor's rights, it is necessary to adhere to three bottom lines. Firstly, do not resort to vigilante justice: actions such as seizing goods, vehicles, blocking doors, and restricting personal freedom are not protected by law and may even result in counter-claims. Secondly, make good use of preservation tools: the significance of preservation lies in "locking up assets", which is much more efficient than recovering compensation afterwards. Pre-litigation preservation should be done as quickly as possible. Thirdly, complete all legal procedures: from notice, litigation, preservation to enforcement, every step should be documented. Creditor's vouchers, service records, and property clues lists should be well organized. If the other party is willing to perform their obligations, they can fix the repayment plan through flexible methods such as mediation, judicial confirmation, and enforcement settlement, which takes into account both efficiency and relationship. For matters involving contract clause review and transaction structure arrangement, relevant reference materials can be consulted.Business and contract dispute services for enterprises.

VI. Frequently Asked Questions

Q1: I've seized the other party's goods. Does this mean that the debt has been offset?

No, the risk is still very high. Seizing the debtor's goods without going through legal procedures does not produce the legal effect of offsetting debts; if there are disputes over the ownership of the goods (such as if they have been pledged, sealed up in another case, or entrusted to others for safekeeping), the seizure may constitute an infringement, and the other party may claim the return of the property and compensation for losses; if the goods are damaged or lost during the seizure, the custodian will also bear responsibility. The legal path is to apply for property preservation or use the goods to offset debts through the execution process, and the court will issue a ruling, so that the transfer of ownership will have opposable effect. For those who have already seized the goods on their own, it is recommended to immediately stop the disposal and consult a lawyer for remedies.

Q2: What evidence do I need to prepare to legally enforce my creditor's rights?

The evidence of basic creditor's rights and the evidence of property clues are indispensable: First, contracts, IOUs, account statements, delivery receipts, invoices, which prove the establishment of the creditor-debtor relationship; Second, collection records, account letters, repayment commitments, which prove the expiration of the performance period and continuous claims; Third, the other party's property clues - bank accounts, property addresses, vehicle model and license plate numbers, equity registration, equipment lists, for the court to investigate and control; Fourth, the subject information - business licenses or ID card copies, legal representative information, to ensure the accuracy of the defendant's subject; Fifth, if the conditions for preservation are met, provide proof of the secured property. Only when all the materials are complete can the case be registered and preserved quickly.

Q3: How much does it cost to apply for preservation of evidence and litigation?

The litigation fees shall be paid in accordance with the "Measures for the Payment of Litigation Costs" (implemented on April 1, 2007), which stipulates that the litigation fees shall be paid in stages based on the amount of the litigation request. For cases applying the summary procedure, the fees shall be reduced by half, and the losing party shall ultimately bear the costs. For applications for property preservation, the preservation fees shall be paid in accordance with the amount of the preserved property at a prescribed rate, with an upper limit of 5,000 yuan, and a guarantee shall be provided (insurance company guarantees are a common method, with the fees usually amounting to a few thousandths of the preserved amount, which shall be prepaid by the applicant). The attorney's fees shall be determined through consultation between the law firm and the client. Overall, the benefits of recovering debts through property preservation and litigation for large-value claims are usually much higher than the costs, while for small-value claims, the cost-effectiveness needs to be evaluated.

Q4: How long does it usually take from preservation of evidence to the actual collection of payments?

After pre-litigation preservation, the plaintiff must file a lawsuit within 30 days, otherwise the preservation will be lifted. The first-instance ordinary procedure and summary procedure shall be concluded within six months and three months respectively. If the defendant fails to perform the judgment after it takes effect, the plaintiff may apply for enforcement within two years. The time required for recovering the execution funds depends on the status of the property: if there are deposits in the account, the funds can be frozen and withdrawn within a few weeks after the freeze; if there are real estate or vehicles, the evaluation and auction period is usually several months; if there is no property at all, the execution may be terminated at this stage, and the execution can be resumed at any time after the property is found. The whole process can be completed in a few months if everything goes smoothly, but complex cases may take longer than a year. It is recommended to apply for preservation simultaneously during the litigation process.

Q5: If the other party refuses to repay the money, what should I do first?

The four-step process to initiate legal action is as follows: 1. Thoroughly organize creditor's documents, send written collection notices or lawyer's letters, and secure evidence of the expiration of the performance period and the assertion of rights. 2. Investigate property clues and immediately apply for pre-litigation preservation and provide guarantees if any signs of asset transfer are detected. 3. File a lawsuit within 30 days, apply for preservation measures during the litigation process, and, if eligible, apply for judicial confirmation of the mediation agreement. 4. After obtaining a favorable court judgment, promptly apply for enforcement and continuously provide additional evidence of the debtor's assets. It is crucial to avoid taking unilateral actions such as seizing goods or vehicles, as this could escalate from "self-help" to "illegal asset seizure." Only by ensuring legal compliance can creditor's rights be realized safely and efficiently.

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

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Legal services for creditor-debtor disputes·Beijing Henglue 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.