Company inspection report
Note: there are six(6) sections to this inspection report. Please carefully review each section prior to making any decision or taking any action regarding the importance of your purchasing. 1-Document Reference Customer: Order Ref: Service: Tracking: Legouiet Mohammed CHW-LM-001 Company verification CHW-07-0509 China supplier: China location: Date inspected: Chinawhy inspector: Shenzhen city 2007-05-09 Andy Wang
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2- Goals of Verification a. to verify whether Iton Technology Ltd in Hongkong is a shell company b. to verify whether Iton technology Ltd in Shenzhen is a real and regit company c. to verify the person we contact in alibaba is the legal owner of the Shenzhen company 3-Inspection Result a. our inspector visit the address Room E/10f, Jinfeng Building, Binhe Road, Futian District,
Shenzhen City, Guangdong Province. China, find the address is true. But we notice that on the business license, the company place of business is Room B302, Building 430, Baguasi Road, Futian, Shenzhen, Guangdong, China. Catherine explain that they have moved their office, but strictly speaking, they should apply to modify their place of business with local Administration of Industry and Commerce. We confirm the address registed in AIC is Room B302, Building 430, Baguasi Road, Futian, Shenzhen, Guangdong, China.. We have also visit Room B302, Building 430, Baguasi Road, Futian, Shenzhen, Guangdong, China and find Catherine didn’t lie. b. the company is located in a 34-storey business building c. the interier decoration of the company is good
d. the inspector have checked their work card, find both Iton technology Ltd(Hongkong) and the Shenzhen company named ““ ” was written on the card. e. the inspector have checked their company brochure and find both Iton technology Ltd(Hongkong) and the Shenzhen company named ““ ” was written on the brochure. f. the inspector have checked their business card and find both Iton technology Ltd(Hongkong) and the Shenzhen company named ““ ” was written on the brochure. The telephone and fax number on the business card is the same with those listed on Alibaba. g. the inspector have checked their business license both in Hongkong and Shenzhen, find the information listed on them are the same with those listed on alibaba. h. the inspector find there are 14 people in the office and the office size is about 200 square meter. The inspector estimated that the rent for the office is around1800USD/M I. the inspector is a seasoned international salesman in Shenzhen city and he said that it is quite usual in Shenzhe area that the company will open a shell company in Hongkong to do international trade because of foreign currency control policy in china as Hongkong don’t have the restriction.
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” which he visit is Conclusion The inspector think the company ““ real, the company’s English name is Iton Technology Ltd(Shenzhen), but apparently the name hasn’t been approved by the local AIC. So when you sign the contract, it should have a Chinese version with the Chinese name of this company. The inspector also think it is quite prevailing in Shenzhen region that a Shenzhen-based company open a shell company in HK to deal with international business, mostly they don’t do business in HK, it is only a company name and a business account. 4-Visit Local AIC a. we check the website of local Administration of Industry and Commerce, after input the registration No.4403011235899 of Iton Technology Ltd(which was listed on http://sziton.en.alibaba.com/trustpass_profile.html), we found that a company named “ ” was registered in the AIC website, which is the same with business license Catherine of Iton Technology Ltd. Send me(see attachment 1), the link of AIC website is http://www.szcredit.com.cn/SZCredit/Query/frmQueryList.aspx?MC=[4403011235899]&Type=0 , but from the AIC website, we can only see the name and legal representitive of the company, for company contact information, address, business scope, business term, etc we have to visit local AIC and have to pay for that. b. The inspector have visited Shenzhen Municipal Administration of Industry and Commerce on the morning of May 10th, 2007 and confirm that the company registration information listed in AIC is the same with those in Alibaba and the business license copy he got from the company. Conclusion: we verify that The company is real and have a good standing of business. The people we contact in alibaba and meet in their company is the owner and staffs of “ (iton technology Ltd(shenzhen))” 5-Other Methods of Verification a. according to international trade practise here, if the company in Hongkong is not a shell company or offshore company or virtual company, they should accept L/C. so I test it by insisting using L/C as payment method, at first, Cathorine make the excuses that it is too expensive as the total value is small, I offer we can pay half of the L/C expense, she hesitate and make the excuse that it take a long time, I then offer to pay all the L/C expense, she didn’t accept that. By that we can jump to a conclution that Iton Technology Ltd(HK) is a virtual and shell company. The fact is that it is easy to spend little money to open an offshore company in Hongkong and open a business account of the company in a foreign bank in Shenzhen to control the payment, and many Shenzhen-based company do business in that way. There is no need to visit Hongkong company registration authority to verify the company as Hongkong don’t verify registered capital. Actually during the conversation, Catherine didn’t deny that this company is a shell company. b. I have called local 114 telephone directory system and know that the contact telephone of the company listed there is 0086-755-83280124, that is different to those listed on alibaba, I called the number and was informed that this is the telephone of this company domestic sales department. c. The Shenzhen-based company don’t have self-support right of import and export, so they don’t
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have business account under their name to receive foreign currency. Conclusion: Iton Technology Ltd is a shell company, which means they don’t have an office and work staff in Hongkong. The telephone of the domestic sales department furtherly confirm that this company is real and have a good standing of business. 6- Overall Evaluations and Suggestions We hereby verify that: 1)Iton Technology Ltd(HK) is a shell company 2)The company “ (iton technology Ltd(shenzhen))” is real and legit 3)The people we contact from alibaba and meet in the company is the owner and staff of this company We suggest that: 1) As the company in Hongkong is a shell company, it is very risky to sign the contract and do business with the Chinese supplier under the name of this company. We propose you to do business and sign contract with their Shenzhen company, namely “ (iton technology Ltd(shenzhen))”. In that case, if any dispute arise from carrying out of this transaction, you can have a chance to make remedy in mainland china. If you sign the contract with the shell company in Hongkong, if any dispute arises, you have to sue this company in Hongkong, that is impossible, because first, they don’t have a body there and second, they are not in Hongkong, so even you win the case, you can’t get your money back. 2) A Chinese version of contract is also needed, because the English name Iton Technology Ltd(Shenzhen) have not approved and registered, so the chinse company name ” have to be included into the contract. 3) Since the company don’t have self-support right of import and export, you can’t remit payment to their business account, because their business account only receive Chinese Yuan. So it is acceptable to send the money to their Hongkong company’s account, but this has to be mentioned in the contract. So you can do T/T with them. By Steven Chow
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