How China Sourcing Agents Really Get Paid

Many agents are paid from both sides of the same order: a fee from you, and a commission from the factory that you never see. This is the full version of the video, with every source, so you can check each point yourself.

How do China sourcing agents really get paid?

A salesman and an agent are not the same job

The man helping you in China may not be a salesman. He looks like one. He answers your messages, visits the factory, sends you photos. But a salesman works for one company, and you know who pays him. An agent works for himself. And many agents are paid from both sides: a fee from you, and a commission from the factory, on the same order.

I am Cengiz Gündüz. 25 years in trade across the United States, Brazil, Türkiye and China, in import and export since 2009, and I report every week from Shanghai. This page is the full version of what I cover in the video, with my sources at the bottom, so you can check every point yourself. I am not a lawyer, and nothing here is legal advice. It is what I have seen, and what the law and the industry say about it.

A salesman sells for the company that employs him. His interest is clear. An agent is different. He represents a company, or a buyer, and he takes a commission. Nothing stops him from representing two companies. Or three.

So when an agent brings you a factory, you cannot know from the outside whether it is the best factory for you, or the one paying him the most. The number that decides it, what he earns on your order, is the one number nobody shows you.

The hidden commission: what the industry itself calls normal

This is not a rumor. People inside the sourcing industry write about it openly.

• •Guided Imports, a freight forwarder that works with importers buying from China, lists the ways an agent gets paid and says plainly that he can be paid not only by the customer but also by the factory and the logistics company. An advertised flat commission, it says, usually runs from 1 to 10 percent of the factory price.
• •It also names the conflict. If the factory that is perfect for you will not pay the agent a big enough kickback, the agent is more inclined to take you to a less qualified supplier for a bigger payday. And when something goes wrong in production, an agent paid by the supplier can end up defending the supplier.
• •The law firm Harris Sliwoski describes an agent who told his client he worked on a modest 5 percent commission, while he was secretly inflating product prices by 35 percent and collecting another 10 to 15 percent from the factories. It came to light only when an internal invoice was forwarded by mistake.

The quoted fee is rarely the problem. The problem is the payment you never see. Once a factory pays your agent, your agent and the factory sit on the same side of the table, and you sit alone on the other side.

What it cost a client I was sent to win back

I had just joined a company, and my first job was a client who had lost all trust in us. The engineer before me had promised them high quality. He sent lower quality, because he had a cut on the difference. And the worst part: he pulled one of the most trusted people in that company into his own game.

When they found out, they threw him out. He left the project half finished and walked away. They sent me there to gain that trust back. Do you believe a relationship like that comes back? Of course not.

No contract buys that trust back. What a contract can do is stop you from losing it in the first place.

What Chinese law says about hidden commissions since October 15, 2025

China revised its Anti-Unfair Competition Law in 2025. The Standing Committee of the National People's Congress issued the revision on June 27, 2025, and it took effect on October 15, 2025. Two points matter for anyone who works with an agent.

First, both sides of a commercial bribe are now covered. As the law firm Hogan Lovells Cadwalader summarizes it, Article 8 of the revised law prohibits not only the offering of bribes by businesses but also the acceptance of bribes by employees, agents and third parties. The revision also introduced personal liability for the legal representatives, key personnel and directly responsible individuals involved in commercial bribery, and for individuals who accept bribes. Under the official text, those individuals face fines of up to 1 million yuan.

Second, open commissions are allowed. Chinese law has long let a business pay a commission to an intermediary openly, as long as both the payer and the receiver record it truthfully in their books. The revised law keeps that rule, in the same Article 8, and puts more weight on transparency.

Read those two points together and you get a simple line. A commission that is disclosed and recorded is normal business. A secret payment from a factory to the agent who is supposed to protect you can fall on the wrong side of that line. Whether it does in a specific case is a question for a China lawyer, not for me. But the principle is the one I have always worked by: say it on day one.

The three honest ways an agent should get paid

There is nothing wrong with earning a commission. Every trading company lives on a percentage. The problem is never the money. The problem is not saying it at the beginning. There are three honest ways:

• •One: you charge the client a fee, and you take no commission from the factory.
• •Two: you take a commission from the factory, you do not charge the client, and the client knows it from day one.
• •Three: you only charge your costs.

Pick one. Say it on day one. Not both. Not quietly. That is the whole difference between an operator and a problem.

Then write the one he picked into your agreement, with a line that says he takes no other payment from the factory unless he discloses it to you in writing.

Who owns the customer list when the agent leaves

Ask yourself one question. If your agent left tomorrow, who owns the customer list? Who owns the supplier contacts, the prices, the relationships?

Most buyers assume the law will protect their list as a trade secret. In China, that is far from automatic. The Supreme People's Court's rules on trade secrets, in force since September 12, 2020, say customer information can qualify, including names, contacts, trading habits and intentions. But it must not be generally known or easily obtained in the trade, and a long, stable relationship with a customer is not enough on its own.

How high is that bar? In a decision dated December 16, 2019, China's Supreme People's Court ruled that a company's list of 43 customers, with names, order details, prices and contacts, was not a trade secret, even though the company had confidentiality agreements and a password protected system. The court's reasoning: the names and contacts could easily be found online, and the order records did not show the customers' purchasing habits or intentions.

So do not wait for a court to decide whether your list is a secret. Write it down. Your agreement should say, in plain words, that the customers and the suppliers belong to you, and every introduction the agent makes should be recorded in writing the day he makes it. A list that only lives in his phone is his list. He leaves with his commission. Not with your business.

The non circumvention clause, and how to make it hold in China

One clause decides whether your agent can go around you. A non circumvention clause says he cannot step over you and deal with your customers or your suppliers directly, cannot sell your product under his own name, and cannot take your supplier and open his own line. Without it, he is free. And you cannot add it later. The day you need it is the day he is already gone.

A clause only protects you if it can be enforced where the other side is. The China Law Blog, published by the law firm Harris Sliwoski, is direct about what makes an NNN agreement work against a Chinese company:

• •Use the other side's exact registered Chinese legal name, not an English trade name or whatever is on a website, and have the company affix its official chop, with the Chinese name on the chop matching the name in the agreement.
• •Prepare Chinese and English versions, with Chinese as the controlling language, so nobody fights over a translation.
• •Choose the governing law and the court with enforcement in mind. A contract that points to a court in your own country is a poor starting point when the other side, the conduct and the assets are all in China.
• •Put a real damages amount in it. Chinese courts are more likely to enforce a specific damages figure written into the contract than a vague promise. The law lets the parties agree damages in advance, but a court can cut a number that is excessively high, so it has to bear a real relationship to the harm. And you can ask a Chinese court to freeze the other side's assets through a separate preservation application.

A non circumvention clause should also say exactly who it covers and for how long after he leaves. Vague wording protects nobody.

When to sign: the day before you give him anything

Here is the mistake almost everybody makes. They hire the agent, they work together for a year, and then they think about an agreement. By then he already has everything: your suppliers, your prices, your customers.

The right time is the day before you give him anything. And it is not distrust. It is the opposite. An agent who knows what he earns and what he cannot touch relaxes. It is the handshake deals that fall apart. A good agent with a contract is worth a lot. A good agent with nothing signed is a risk you took for no reason.

Two checks you can do this week

• •Ask one question: "Who else is paying you on this order?" A good agent answers right away and is not offended by it.
• •Get the factory's quote directly, on the factory's own paper, not forwarded by your agent. If the price changes between the factory and you, you will see it.

The bottom line from the floor

An agent can be the best hire you ever make, or the most expensive. The difference is not his talent. It is whether the money, the list and the exit were put in writing before he met your first customer. Say how he is paid on day one. Own your list. Sign before you share.

Every source on this page was checked on 25 September 2026. The law moves, so if you are reading this much later, check the legal points again with a China lawyer before you rely on them.

The agreement I use myself is the China Sales Agency and Commission Agreement, $47. English and Chinese side by side, written for Chinese courts: non circumvention, customer list ownership, commission terms in writing, and a clean exit. Sharing a design or a supplier first? The China NNN Agreement, $47. A question about your own agent? Ask the Sourcing Desk, free to try. And if you want me on site to check the factory before you pay, Factory Verification starts at $1,500.

Questions buyers ask me

Sources: every number on this page

• Official text of the revised Anti-Unfair Competition Law: adopted 27 June 2025 and in force 15 October 2025 (Article 41). Article 8 bans offering and accepting commercial bribes and allows a business to pay an intermediary a commission openly, provided both sides record it truthfully in their books; Article 24 sets fines of up to 1 million yuan for the individuals responsible. National People's Congress of China, Anti-Unfair Competition Law, 2025 revision (Chinese)
• China's revised Anti-Unfair Competition Law was issued on 27 June 2025 and took effect on 15 October 2025. Article 8 prohibits both offering and accepting commercial bribes, including by employees, agents and third parties; the revision introduced personal liability for the individuals involved, and the law continues to require that discounts and commissions be recorded truthfully. Hogan Lovells Cadwalader, China's 2025 Anti-Unfair Competition Law Revision
• The Supreme People's Court's trade secret rules (Fa Shi [2020] No. 7, in force 12 September 2020): customer information includes names, addresses, contacts, trading habits and intentions (Article 1); a long, stable trading relationship alone does not make a customer a trade secret (Article 2); the information must not be generally known or easily obtained in the field (Article 3). Supreme People's Court Gazette (Chinese)
• In decision (2019) 最高法民再268号, dated 16 December 2019, China's Supreme People's Court held that a list of 43 customers was not a trade secret despite confidentiality agreements and a password protected ERP system, because names and contacts could be found online and the other data did not reflect purchasing habits or intentions. China IP Law Update, China's Supreme People's Court Rules Customer Lists are not Trade Secrets
• An NNN agreement meant to be enforced against a Chinese company should use its exact registered Chinese name and official chop, Chinese as the controlling language, a governing law and forum chosen for enforcement, and agreed damages with a defensible link to the harm; freezing assets is a separate court process. Harris Sliwoski, China Law Blog: China NNN Agreements, The Ten Most Asked Questions Answered
• Chinese courts are more likely to enforce specific monetary damages written into the contract than vague promises, contracts under Chinese law and in Chinese are taken more seriously, and an asset preservation order can be sought at the start of litigation. Harris Sliwoski, China Law Blog: Contract Enforcement in China, What Works and What Doesn't
• A sourcing agent who claimed a 5 percent commission was secretly inflating prices by 35 percent and collecting another 10 to 15 percent kickback from the factories. Harris Sliwoski, China Law Blog: Sourcing Agent Deceptions
• A sourcing agent can be paid by the factory and the logistics company as well as the customer; advertised flat commissions usually run from 1 to 10 percent of the factory price; an agent may steer a buyer to a less qualified supplier that pays a bigger kickback, and may defend the supplier when production goes wrong. Guided Imports, Should You Use an Independent Sourcing Agent in China?

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