How to make a Chinese buyer pay a commission?

[jacobkane]

Hello,

I'm new to this forum. My company is consulting buyers in China who are looking for investment properties abroad. We are headquartered in Europe and I am running the representative office in China.

We have recently sold a hospitality business in the UK, including hotel, to a buyer from China. As there was an agent involved on the seller's side, we had the buyer sign a mandate with my company, stating that a consulting fee of XXX would be due 30 days after closing the deal.

Soon after a Chinese manager took over the operation and failed to present updated employment contracts, they first fell out with the director of the hotel and then with the head chef. Most of the local staff left their workplace as they didn't get along with the Chinese manager's attitude.
It didn't take long until the ratings on Tripadvisor went down, resulting in less guests & revenue.

The result is: As the buyer is not happy with the development of the business of the hotel, he refuses to pay the consulting fee.

Would it be possible to enforce the contract in the UK? The client is a powerful man and there's not really a rule of law here, so I don't see any chance to enforce the contract in the middle kingdom.

Pease share your thoughts about this with me

JK

 

[Longterminvestor]

It depends on the small print in the contract but if they are based in China it might be difficult. Would a UK court freeze the UK assets of the company to cover the funds due? Probably not.

In hindsight it might have been better to charge a monthly retainer as opposed to a commission per transaction.

 

[jacobkane]

@Longterminvestor: Thank you

The agreement I have is signed by the purchaser (Mainland Chinese) on behalf of his HK LTD, and yes, the idea is to sue in the UK where the asset is located.

 

[realdeals]

Are we talking about a large enough commission fee to warrant a potentially expensive court case? Or would it be better to look at some form of arbitration?