Out of all the countries I've dealt with in the past 20+ years, China always makes me cringe. If it involves a large order, I will hire an agent from a reputable company to oversee the process (Bureau Veritas is one of those).

To understand the type of business ethics some Chinese have, here is the worst account I've heard first hand. This is directly from one of my best friend.

That person is an architect by trade and they do major buildings (hotels/schools/apartment complex, etc) on the international level. They get an invite to design a smaller hotel in China. They design the hotel and submit their proposal. The Chinese accepts their design and invites them over. My friends gets there, is shown the building site in person, visits the contractors offices, etc. One evening, he is to meet with city officials "to make friends" . Part of the ritual is to bring small gifts. So my buddy buys a bunch of cartons of cigarettes, and go to dinner.

My buddy called me up all excited as soon as he gets back because it's their first project in China. He has a signed contract in hand. A few weeks go by and the Chinese go silent. The long and short of the story is that there never was a project. The Chinese guys fabricated the whole thing just to get 10 or so cartons of cigarettes and a free dinner.

So when you think about all the BS the Chinese had to come up with , from the initial communication to arranging to visit several Chinese offices, etc just for free cigarettes, what do you think they would be willing to do for $XXXX?

With the Chinese, the very, very first step is to ask for European/ North American business references. You want to reach out to at least 5 companies and ask for their feedback in the most minute details. Make sure these companies are owned by Europeans/N American and that the transaction history is very fresh (3 months or less). If the feedback is good, you go to step two; hire a 3rd party agent.