Refuse. When a Chinese supplier asks for payment to a personal account, company money is going where the law says it may not be kept (Company Law art. 217), and proving it reached the company falls on you (Civil Code arts. 170, 172, 557 and 626; SPC Civil Procedure Law Interpretation, art. 91). A Hong Kong company or other affiliate can work if the company you contracted with names that payee in a sealed letter before you pay. If time is short, ask for the letter below and wire nothing until you have it.
In July 2023 the Zhejiang Higher People's Court ordered a machinery maker in Taizhou to refund a Bulgarian buyer who had paid through another company's account. The factory's name was not on that account. It still had to give the money back.
A Taizhou factory, a holding company's account and a USD 105,840 refund
The deal was made by email, WeChat and proforma invoice: mask-making machines and materials for USD 105,840. The buyer wired USD 30,000 on 20 May 2020 and USD 75,840 on 2 June, both to the account of a holding company the factory had designated.
The machines arrived rusted, and an inspection in Bulgaria found they had been used. The Taizhou Intermediate People's Court dismissed the claim. On appeal, the Zhejiang Higher People's Court held that delivering used machines was a fundamental breach and ordered the factory to refund RMB 740,117 with interest, plus RMB 50,000 toward freight and insurance ((2022) Zhe Min Zhong No. 811, 31 July 2023).
The court never had to decide whether paying the holding company counted as paying the factory. Nobody disputed it: the factory accepted it had been paid, and the record showed it had named the account. That is the position you want before any dispute starts.
What happens if you pay a Chinese supplier's personal account
Your debt ends when you perform it (Civil Code art. 557), and you perform by paying as agreed (art. 626). If the supplier later says it was never paid, proving payment is your job (Civil Procedure Law Interpretation, art. 91). A remittance slip proves that money reached an individual. It does not prove that the individual was collecting for the company.
Authority has to fill that gap. Staff bind the company on matters within their job (art. 170). Beyond that you need apparent authority (art. 172): an appearance of authority, and no knowledge or carelessness on your side (General Provisions Interpretation, art. 28).
We think a business buyer stands badly here. A sales manager's title shows authority to quote and take orders, not to collect the price in a private account. Expect the court to ask why a company paid an individual when the proforma invoice named a company.
Most of these requests are not fraud. A small owner-run factory may simply keep some sales outside the company account. Article 217 forbids holding company funds in an individual's name, so the request does tell you something about the books your order will sit in.
If the money has already gone, keep the instruction and ask the company to confirm receipt in writing. Mixed funds may later support a claim against the owner personally, and a sole shareholder must prove the company's assets are separate (Company Law art. 23). That is a fallback only. The Taizhou buyer also sued the factory's two shareholders, relied on the one-shareholder rule, and lost.
Personal account, Hong Kong company or export agent: how to answer each request
"Pay my account, I'm your sales manager." No. For a sample fee of a few hundred dollars we would live with the risk, keep it outside the order price and ask for a receipt.
"Pay the boss's account." Still no, though your position is better. What the legal representative (the person registered to act for the company) does in the company's name binds it (Civil Code art. 61), but a private account shows no company name. Ask for the company account.
"We are a sole proprietor." If the licence reads 个体工商户, the operator personally is your counterparty, and an account in that person's name can be the right one. Sign with that person by name and ID number.
"Pay our Hong Kong company." Ask who your seller is. If the Hong Kong company signs as seller, your claim is against it and the factory sits outside the contract; our article on trading company suppliers covers how to reach the factory. If the mainland factory stays as seller and the Hong Kong company only receives the money, get the letter below. Questions of Hong Kong law go to Hong Kong counsel.
"Pay our export agent." This one is ordinary. China's foreign exchange rules start from the principle that the exporter collects, and on agency exports the agent normally does (SAFE Guidelines, art. 9). Name the agent in the contract.
If any of these arrives as a change after the deal was agreed, treat it as possible fraud first and run the checks in our note on a supplier's new bank account.
A payee letter to get sealed before the wire
Ask for this on the supplier's letterhead, stamped with its company chop (the official company seal). Confirm it by telephone on a number you already had.
"To [Buyer]. Re: Contract / PI No. [ ]. We, [supplier's full Chinese and English name], unified social credit code [ ] (the company's registration number), are the seller under this contract. We instruct you to pay USD [ ] of the price to: account holder [ ], bank [ ], account number [ ], SWIFT [ ]. The account holder receives this sum on our behalf. Payment to this account discharges your payment obligation to us in that amount. We remain liable as seller for delivery, quality and any refund. This instruction may be changed only by a further letter bearing our company chop."
Two sentences do the work: the one on discharge and the one keeping the seller liable. Had the Taizhou factory denied being paid, those are what the buyer would have wanted to hold. After the wire, send the slip and ask for one line of sealed confirmation.
Sources
- Zhejiang Higher People's Court, (2022) Zhe Min Zhong No. 811 (31 July 2023), a Bulgarian company v a Taizhou machinery company and its shareholders, reversing Taizhou Intermediate People's Court, (2021) Zhe 10 Min Chu No. 37; UNCITRAL CLOUT case 2140, full Chinese text at uncitral.org/res/clout/clout/data/chn/clout_case_0_html/CHN_31072023_FT.pdf
- Civil Code of the PRC, articles 61, 170, 172, 557 and 626 (effective 1 January 2021), text on the Ministry of Justice site, moj.gov.cn/pub/sfbgw/zwgkztzl/2025nianzhuanti/2025mfdxcy/2025mfdxcy_mfdql/202505/t20250507_518708.html
- Company Law of the PRC (2023 revision), articles 23 and 217, npc.gov.cn/npc/c2/c30834/202312/t20231229_433999.html
- Supreme People's Court, Interpretation on Several Issues Concerning the Application of the General Provisions Part of the Civil Code (Fa Shi [2022] No. 6), article 28, court.gov.cn/zixun/xiangqing/347211.html
- Supreme People's Court, Interpretation on the Application of the Civil Procedure Law (2022 amendment), article 91, court.gov.cn/fabu/xiangqing/353651.html
- State Administration of Foreign Exchange, Guidelines on Current Account Foreign Exchange Business (2020 edition), article 9, m.safe.gov.cn/safe/file/file/20200831/f0127756271c43ef9b3908d5d157bd91.pdf
- Translations are mine and unofficial.
Frequently asked questions
- Is it illegal for a Chinese company to take payment in a personal account? Company funds may not be held in an individual's name (Company Law art. 217). That duty sits with the company and does not by itself cancel your order.
- Why do Chinese suppliers ask to be paid through Hong Kong? Reasons given include group treasury and foreign exchange arrangements. Whatever the reason, the seller should name the payee in writing before you pay.
- What if the supplier says its company account is frozen? Do not pay around it. Check the company's court records first, because a frozen account may mean a creditor got there before you.
- Can I pay an individual at a Chinese supplier by Alipay or WeChat? The same risk applies. The app record shows who received the money, not that the person was collecting for the company.
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Related reading
- Your Chinese Supplier Says It Has a New Bank Account: How to Verify Before You Pay
- Your Chinese Supplier Is a Trading Company: How to Make the Contract Reach the Factory
- Is a Proforma Invoice a Contract in China? Yes, and It Probably Won't Cover Your Legal Fees
This article is general information on PRC law as of 6 November 2026 and does not constitute legal advice. The answer in any matter depends on its documents and facts.