On China Law Blog, in a post titled The Legal Faults With Faulty China Translations, Dan Harris suggests you need a good legal translator to do business in China, preferably ‘a truly bilingual attorney who works just for you’:
My favorite (which I have seen at least a half a dozen times) is to do an English language contract that says “A” and a Chinese language contract that says “not A.” The Chinese language contract then makes clear that in any dispute it will prevail. The American party thinks it just signed a contract that says “A” but in reality it just signed a contract that says “not A.” We have twice dealt with situations where a company came to us believing that its joint venture agreement required the joint venture to use the American company as the exclusive US distributor of the Joint Venture’s products, but the contract actually made the US company the exclusive distributor of the Chinese joint venture partner’s product. The problem in both cases was that the Chinese company joint venture partner had never and was not making the product for which the US company believed that it had become the exclusive distributor. Then there are the countless times a word like “must” is changed to “may.”
I wonder whether these contracts provide that the Chinese language and Chinese law govern. Sounds like it. When I translate contracts they’re in German and the German language and German law govern, and my translation into English is just a gloss. I believe one of the biggest German law firms used a watermark on their translations into English saying ‘For information only’ – and those were practising (and therefore insured) lawyers involved. Whatever is going on here involves legal work, as far as I can see. In my situation, if I happened to translate the opposite to what the contract said, firstly the client normally checks in, but in the last instance the German prevails. From my regular reading of China Law Blog (I get the RSS feed), things are not so rosy in China.