Pre Litigation Asset Preservation and Tooling Repossession Mechanics under PRC Law
Pre-litigation preservation under Article 104 freezes factory tooling within 48 hours using surety bonds, securing physical assets before formal litigation.
CNC Fixture Custody
Meaning
Contractual bailment arrangements govern the physical possession, maintenance, security and operational deployment of specialized manufacturing workholding devices stationed inside a supplier’s production facility. Precision tooling management relies on cnc fixture custody agreements to allocate legal liability and operational duties whenever computer numerical control machinery utilizes buyer-owned clamping systems, custom jigs and automated locating devices. The framework governs tooling preservation, calibration tolerances, unauthorized reproduction prohibitions and return protocols under the Civil Code of the People’s Republic of China.
This custodial relationship concludes when the underlying production contract terminates and the physical fixtures are returned, transferred to an alternative vendor, or formally scrapped under joint supervision.
Operational Allocation
Custodians must mount, operate and calibrate custom fixtures in strict accordance with engineering work instructions and maintenance intervals. The factory floor supervisor assumes direct operational responsibility for preventing mechanical damage, spindle collisions and environmental corrosion across all assigned workholding setups. Daily inspection logs record clamping pressure, pneumatic seal integrity and locating pin wear to ensure continuous dimensional accuracy of machined components.
The supplier holds no right to modify fixture geometry, dismantle modular assemblies or deploy the equipment for unapproved customer orders without prior written authorization from the title holder. Routine maintenance costs fall upon the custodian, while major overhauls resulting from normal operational wear remain subject to negotiated contractual allocations.
Title Preservation
Clear proprietary markings and administrative filings protect specialized workholding assets against unauthorized commingling with the fabricator’s general capital assets. Plant managers attach permanently etched metal asset plates, apply tamper-evident seals and execute detailed equipment custody certificates that identify the non-resident purchasing entity as sole legal owner. These physical precautions must be paired with security filings on the Unified Movable Property Financing Registry under the Credit Reference Center.
Formal registration provides public notice to prospective lenders, preventing the custodian from pledging the machining fixtures as collateral for domestic working capital loans. Robust inventory ledgers cross-reference asset serial numbers with specific manufacturing cells to facilitate external auditing.
Remedial Transfer
Factory insolvency, severe quality failures or contractual breaches trigger immediate repossession protocols to extract proprietary fixtures from the supplier’s compound. The title owner delivers a formal notice of termination alongside a demand for asset surrender, deploying logistics personnel to inspect, pack and transport the workholding hardware. If the custodian refuses access or asserts an invalid commercial lien over the tooling, the owner must initiate property preservation procedures before the local People’s Court.
Securing a judicial preservation order permits court bailiffs to enter the workshop, inventory the physical items and supervise the physical extraction of the tooling for transport to an approved secondary machining vendor.