Three Types of Actual Omissions in Contracts Between Printing Plants and Brand Owners—Three Clauses That Shift Liability to the Printing Plant Even When the Contract Clearly States Them

Last Wednesday afternoon, Wang Jie, the owner of a gift box factory in Wuxi, called me. She had received an order for 3,000 cosmetics gift boxes, worth 210,000 in total, from an emerging beauty brand in Shanghai. The customer's design draft used a gradient color scheme from a well-known international brand. At the time, Wang Jie thought it was “close enough” and therefore did not include any intellectual property indemnity clause in the contract.

As a result, 2 weeks after the goods were delivered to the customer's warehouse, a lawyer's letter arrived from the original brand owner alleging "counterfeit packaging design" and demanding that the printing factory bear joint liability for compensation of 80,000. Only then did Ms. Wang check the contract and discover that it contained nothing more than a clause stating "printing according to the customer's approved proof," with no intellectual property indemnity, no disclaimer of liability for the printing factory, and no dispute resolution mechanism.

Ms. Wang’s case is not an isolated one. In a survey of 12 printing companies in Wuxi, Suzhou, and Shanghai, the owners of 11 could not identify any clauses in their contracts that truly addressed the needs of their printing businesses. This is a common problem among printing company owners: they assume that whatever the customer sends is what they should sign, and that their only responsibility is to produce according to the artwork.

In practice, as the “professional party,” the printing plant may assume direct liability if any of the 3 categories of provisions is omitted from the contract. The issue is not whether these provisions “should be included in the contract,” but the practical risk that “if they are not included in the contract, the printing plant must bear the liability.”

Category 1: Intellectual Property Indemnity Clauses—the “Contract Manufacturing Liability” Trap That Printers Most Often Fall Into

Ms. Wang’s case falls precisely into this category. If the contract merely states “production according to the customer-approved design,” the printer will be deemed to have endorsed the legality of the customer’s design. If the customer’s design allegedly infringes upon intellectual property rights, constitutes copying, or uses a LOGO without authorization, the printer, as the producer, will be sued jointly with the customer by the original rights holder.

Actual precedent: In a case decided in 2025 by the Suzhou Intermediate People’s Court, a client’s cosmetic packaging design imitated the bottle shape of an international brand, and the printing company was ordered to jointly and severally pay compensation of 120,000 yuan. The court reasoned that “as a professional packaging manufacturer, the printing company should have a duty to review design drafts that contain obvious violations.”

The correct contract terms should be written as follows:

“Party B (the printing plant) shall not assume an active review obligation regarding the intellectual property rights or legality of the design drafts provided by Party A (the brand owner). However, if the materials provided by Party A contain any obvious violations of law or infringement, Party B shall notify Party A in writing. Any intellectual property dispute arising from Party B’s execution of Party A’s materials shall be borne entirely by Party A.”

Approximately 60% of courts accept this formulation, which is 60% higher than merely stating that “the printer is not responsible for errors in the design” because the latter would be deemed “grossly unfair” and invalid.

Category 2: Acceptance of Delivery—How Customers Delaying Acceptance Can Disrupt the Printer’s Cash Flow

A printing company in Jiangsu that produces food packaging manufactured 5,000 kraft paper bags for a chain restaurant brand under a contract worth RMB 75,000. The contract stipulated payment within 30 days after acceptance. After receiving the bags, the customer delayed acceptance, citing that its “internal approval process had not yet been completed.”

This dragged on for 6 months. The printing plant's cash flow was disrupted twice, and it could not pay its workers' wages. When the customer finally declared the job “accepted as qualified,” the printing plant went to collect payment, only for the customer to say that the “30-day period begins from the date of acceptance as qualified.” As a result, it dragged on for another 30 days.

If the contract omits the provision that “failure to inspect within X days shall be deemed acceptance,” the printing factory will be held hostage by the customer.

Correct contract terms:

If Party A does not raise any written objection within 7 working days after receipt of the goods, the goods shall be deemed to have passed inspection. Within 30 days after passing inspection, Party A shall pay the full purchase price. If payment is made late, Party A shall pay Party B liquidated damages at a rate of 0.05% per day.

The key to this clause is “No objection within 7 working days = automatic deemed acceptance”—leaving the customer virtually no room to delay. If the customer still insists on delaying, the printer can rely on the contract to assert that “deemed acceptance has already occurred,” which is legally defensible.

Category 3: Force Majeure Clause — The "Beyond the Printer's Control" Trap Most Likely to Result in Deductions for Delayed Delivery by the Printing Plant

In September 2023, a printing plant in Wuxi that produced cosmetics packaging had to delay an order by 5 days because a paper mill in Shanghai unexpectedly halted production due to a fire. The customer contract did not include a force majeure clause, so the customer deducted 8% of the order value under the provision of “2% deducted for each day of delay.” The printing plant not only made no profit on this order but also lost 8000 yuan.

In 2024, VOC controls were tightened, and printing plants in Wuxi and Suzhou were ordered to limit or suspend production for 1-3 months. As a result, they were unable to deliver on time, and customers withheld payments as stipulated. If the contracts had explicitly included force majeure, the printing plants would not be liable for the delays.

Correct contract terms:

If delivery by Party B is delayed due to force majeure (including but not limited to government production restriction orders, raw material supplier shutdowns, natural disasters, or epidemic control measures), Party B shall not be liable for breach of contract, provided that Party B shall notify Party A in writing within 3 working days after the occurrence of the event and provide relevant supporting documents.

The key to this clause is “written notice within 3 working days + provision of supporting evidence”—the printer may not silently delay delivery; it must proactively notify the customer and provide evidence, such as government documents or supplier suspension notices. Once the customer receives the notice and supporting evidence, payment deductions will generally no longer be made.

4 fixed template paragraphs for printing factory contracts (ready for direct copying)

The 3 clauses above, together with 1 dispute resolution clause, form the 4 fixed sections of the printer contract. We recommend that printer owners copy these 4 sections directly into every contract, so there is no need to draft them from scratch each time:

Paragraph 1: Intellectual Property Security (see the preceding paragraph for wording)

Paragraph 2: Acceptance Upon Completion of Deliverables(7 Business Days + Automatic Acceptance + Liquidated Damages)

Section 3: Force Majeure (Government Production Restrictions + Supplier Production Suspension + 3-Day Notice)

Paragraph 4: Dispute Resolution — “Disputes arising from this Contract shall be subject to the jurisdiction of the court located where Party B is domiciled” (the printing plant must include this clause. The customer is in Shanghai, while the printing plant is in Wuxi, so litigation would take place in Wuxi, giving the printing plant home-court advantage. If the customer insists on litigating in Shanghai, the printing plant should be alert to the possibility that this order contains a trap).

3 Opportunities for Print Factory Contract Self-Inspection

Signing the contract does not mean everything is settled. The printing plant should conduct a self-inspection of the contract at 3 stages:

Timing 1: Before signing — The customer sends over the contract, and the printing plant’s sales representative/owner spends 15 minutes checking it against these 4 sections, filling in anything that is missing

Timing 2: During Production—If the customer revises the artwork, production process, or quantity midway, the printing plant must issue an additional “change order”; changes cannot be assumed to be authorized.

Timing 3: After delivery—When the customer delays acceptance, the printer must send an “Urgent Acceptance Request Letter” on the day the 7th working day expires, leaving written evidence

The 1 Thing Every Printing Plant Owner Should Do

Print out the 4 fixed sections of this contract and place them beside your computer. Before signing each new contract, check it against these 4 sections. Missing even one section means the printing plant assumes an additional 10-20% risk.

Sister Wang's case: she later proactively contacted the client to negotiate, and the client ultimately held the printing factory responsible for only 30,000 (the original rights holder withdrew half of the claims). If her contract had included an intellectual property clause in advance, this 30,000 would not have had to be paid.

A contract is not a formality; it is the printing company's last line of defense.

Further Reading