2026 Cross-Border Surrogacy Country Map: Legality, Cost and Identity Risk in 20 Jurisdictions

Introduction: Two changes thirty-seven days apart

On July 14, 2026, President Tokayev of Kazakhstan signed a law amending the Marriage (Marriage) and Family Code, which came into effect on July 26.

The revised code limits intended parents in surrogacy arrangements to married citizens of Kazakhstan.

Foreign nationals, single people and couples without a registered marriage are no longer eligible. Kazakhstan's surrogacy market is closed to foreign intended parents.

Thirty-seven days later, on August 6, the President of the United States signed two executive orders. No. 14418, "Continuing to Protect the Meaning and Value of U.S. Citizenship," Article 2(c) stipulates that if both parents are non-U.S. citizens, birthright citizenship will not be recognized in the following circumstances:

This is the first time that surrogacy has been directly included in birthright citizenship provisions at the federal level in the United States.

The two changes were thirty-seven days apart and occurred respectively in the main destination country in Central Asia and the destination country with the highest legal certainty. Most of the judgments on the legal status of various countries formed between 2024 and 2025 are no longer applicable.

The following is a review of the current legal status of 20 countries and regions.

Chapter 1 Three main lines of the global surrogacy legal environment in 2026

In the past twenty months, the global cross-border surrogacy landscape has been squeezed by three main lines at the same time. Understanding these three lines is more important than remembering the conclusion of any country - because the conclusion will change, but the trend will not.

Main Line 1: The Wave of Closures Across Central Asia and the Caucasus

The starting point of this line is Russia in December 2022. Russia banned foreigners from using surrogacy services in Russia in the form of federal law, shutting down the world's largest low-cost market overnight. The industry responded by migrating: the war in Ukraine combined with the closure of Russia, a large number of clinics, agencies, donor eggs and surrogate mother resources moved southward, pouring into Georgia, Armenia, Kazakhstan, and Kyrgyzstan.

This round of migration created the short-lived prosperity of Central Asia and the Caucasus from 2023 to 2025, and also laid its mines.

• July 2024, Armenian Law (ՀՕ-317-Ն). The Chinese market generally reads this as "relaxation", but its Article 12 also establishes an ethnic threshold - foreigners of non-Armenian origin are not allowed to use Armenian surrogate mothers (see 4.3 for details, we checked the original text of the law).
• July 2026, Kazakhstan closes its doors. The trigger was a government investigation in December 2025 - which identified the exploitation of women and children in the country's surrogacy industry, as well as an illegal egg donor network.
• In August 2026, two draft restrictions appeared in Kyrgyzstan within the same month. One of them was proposed by the speaker of the parliament himself, and included criminal liability provisions of 8 to 20 years for the sale of children through surrogacy, forgery of documents, etc. Data cited in the justification for the legislation are: Of the 153 surrogate children registered in the country in 2024-2025, 138 were registered in the names of foreigners.

This is a classic domino. Every time a country shuts down, it will push demand to the next country; and the sudden influx of demand will create the same chaos in the next country, and then the same legislation. The remaining gates in Central Asia-Caucasus are calculated by years, not by decades.

Main Line 2: The U.S. Citizenship and Documentation Chain Tightens

The U.S. option is the most expensive of all destinations, and its value lies in the certainty: established state laws, enforceable contracts, pre-birth parentage orders, and citizenship by birth.

The January 2025 executive order first struck at this last provision, but it was blocked by the Supreme Court on June 30, 2026. In Trump v. Barbara (Case No. 25-365), the Supreme Court overturned the executive order in a 6-3 decision. Chief Justice Roberts emphasized in the majority opinion that the Fourteenth Amendment's citizenship clause has "extremely broad coverage" and the exceptions are limited to the narrowest categories of children of foreign envoys and members of nineteenth-century tribes.

Thirty-seven days after losing the case, the two executive orders signed on August 6 did not directly challenge the Fourteenth Amendment, but instead cited the narrow exception recognized by the Supreme Court in that case:

• EO 14418: Excludes four categories: "children of aliens from enemy countries", "children of foreign government employees", "children born of commercial birth arrangements (including surrogacy)" and "persons born in specific U.S. territories" from the issuance of citizenship documents. Agencies are required to issue implementation guidelines within 30 days.
• EO 14419 (Ending Birth Tourism): Defines "birth tourism" as "any alien who enters the United States on a non-immigrant visa to give birth, or any alien who assists another person in so entering." Instructs the Department of State and the Department of Homeland Security to deny or revoke visas, permanently ban entry, expel relevant personnel, and take action against institutions, organizations, and individuals at home and abroad that assist or promote birth tourism. Article 5 of the Order retains room for discretion in humanitarian exemptions.

These two executive orders are in direct conflict with the rules announced by the Supreme Court two months ago, and the possibility of being sued and losing on the merits is high. For a specific family, the outcome of the lawsuit and whether the certificate can be obtained in the current period are two-level issues. The practical impact of the executive order is concentrated on the procedural aspects: passport applications are put on hold, consular procedures are delayed, visas are refused or revoked, and assistance agencies are sanctioned, resulting in service chain interruptions.

Another set of data: In 2024, there were less than 10,000 newborns in the United States whose mothers registered overseas addresses; however, an estimate based on the census in April 2026 by the Washington think tank Migration Policy Institute (MPI) believed that the actual scale of "birth tourism" was between 22,000 and 26,000 per year. This difference is the source of pressure for law enforcement.

Main line three: Europe’s “extraterritorial accountability” for its citizens

This is the line that is most easily ignored by Chinese materials, but is the most fatal to certain families.

The traditional understanding is that the legality of surrogacy only depends on "where it is done." This understanding is no longer valid after 2024.

On November 4, 2024, Italy passed Law No. 169, which will enter into force on December 3, 2024. It expanded Article 12, Paragraph 6 of Law No. 40 of 2004, which was originally applicable only to domestic surrogacy crimes, to a so-called "reato universale": Even if Italian citizens perform surrogacy in countries where surrogacy is completely legal (such as the United States and Canada), they can still be prosecuted according to Italian law after returning home, with a prison term of 3 months to 2 years and a fine of 600,000 to 1 million euros.

Spain is taking a different path - not moving the criminal law, but moving the registration. In December 2024, the Spanish Supreme Court ruled that the surrogacy contract was invalid and violated public order; subsequently, starting from May 1, 2025 (according to BOE-A-2025-8647), Spanish embassies and consulates abroad were not allowed to register children born through surrogacy, and all ongoing applications were cancelled. Intended parents must separately prove a biological connection to the child or go through the full adoption process.

At the EU level, there is another thing that is seriously underestimated: Directive 2024/1712 (effective on July 14, 2024) explicitly lists "surrogacy exploitation" as one of the forms of exploitation of human trafficking for the first time, and requires member states to criminalize the act of "knowing that the other party is a victim of human trafficking and still using its services." The conversion deadline for member states is July 15, 2026 – that is, this conversion window closed just over a month ago. In the next two years, law enforcement actions against the cross-border assisted reproductive industry chain in the EU will increase significantly, and these law enforcement actions will spill over to destination countries outside the EU (Georgia, Ukraine, and the Balkans are all nearby).

The last thread is at the level of international law: the Parentage/Surrogacy Project Working Group of the Hague Conference on Private International Law (HCCH) met five times (November 2023, April 2024, November 2024, April 2025, November 2025) after being authorized in March 2023, and submitted its final report in November 2025. The CGAP meeting from March 3 to 6, 2026 decided not to enter the special committee stage of drafting a convention.

An international unified recognition mechanism will not appear in the foreseeable future. Each family's legal-identity and documentation chain must still be solved by itself by connecting the "laws of the destination country + the laws of the home country". There is no guarantee.

Chapter 2 Evaluation Framework: Three Dimensions plus One Axis

Legality, cost, and identity risk are the three dimensions commonly used to evaluate the legal environment of cross-border surrogacy. The situation in 2026 shows that this framework needs a supplement.

Dimension 1: Legality (Static)

There are four completely different kinds of "legal" to distinguish:

1. Statute law explicitly allows foreigners (such as the current law of Kyrgyzstan, the current law of Ukraine) - the strongest.
2. Permitted by statutory law, but not explicitly provided for foreigners (e.g. Georgia) - Moderate, wide scope for interpretation by administrative agencies.
3. No written law, supported by precedents (such as Mexico, Colombia, Argentina) - weak, each case may require separate judicial procedures.
4. Legal grey zone (such as Northern Cyprus, Albania, Laos) - the weakest, an absence of effective regulation rather than affirmative legal permission.

"Not prohibited" does not equal "legal". The main risk in gray areas is the lack of remedies: there are no local laws to invoke in the event of a dispute.

Dimension 2: Cost (including implicit costs)

A headline package price is never the true cost. True cost = package price + cost of failure + legal procedure cost + extended-stay cost + exposure to agency insolvency or misappropriation.

Among them, "agency insolvency and misappropriation exposure" is the least priced item in the Chinese market, but will suffer the most losses from 2025 to 2026. A specific figure will be given in the Georgia section later.

Dimension 3: Legal-Identity Risk (The Return-to-China Documentation Chain)

This is the end, not the beginning. No matter how legal and cheap a country is, if the child cannot get the documents that can be taken back home, everything will be lost. The legal-identity and documentation chain is composed of five links in series. If any link is broken, the entire chain will fail - see Chapter 10 for details.

The fourth axis: Policy stability (dynamic)

This is a new variable emerging in 2026, and multiple cases show that its impact has outweighed its costs.

An surrogacy journey usually takes 12 to 18 months from signing the contract to carrying the baby back to the country. The laws that apply when you sign a contract may be different from the laws that apply when you complete the entire process.

It only took about seven months in Kazakhstan from the government investigation (December 2025) to the law taking effect (July 26, 2026) - shorter than a complete surrogacy journey, which means that encountering legislative changes within one cycle is not a small probability event.

There are four observable leading indicators for assessing stability:

1. Has any parliamentarian or government in the country proposed a restrictive draft? (Kyrgyzstan: Yes)
2. Have there been any industry scandals in the country in the past two years that have attracted national attention? (Georgia: yes, many)
3. Did the country's neighbors just close their doors? (All Central Asia: Yes)
4. Are a large number of surrogate mothers in this country coming from foreign countries? (This is the strongest shutdown signal - because it escalates the issue from "domestic women's rights" to "human trafficking", and human trafficking is a trigger for international pressure)

Chapter 3 Red-List Jurisdictions: Countries That Have Closed Their Doors

The countries listed in this chapter have all passed legislation or judicial means to close commercial surrogacy services to foreigners.

Russia 🔴

A federal law banning the use of surrogacy services by foreigners in December 2022. This was the starting point for a whole wave of closures. Russian citizens and foreigners married to Russian citizens can still use it. For Chinese families, this route is unavailable.

Kazakhstan 🔴 (from July 26, 2026)

• Basis: Kazakhstan's official Әділет legal information system records Law No. 350-VIII of July 14, 2026, amending the Marriage (Matrimony) and Family Code No. 518-IV of 2011; it entered into force on July 26, 2026. Chapter 9 (Articles 54-59) of the Code is a special chapter on surrogacy: Article 54 is the surrogacy contract, Article 56 is the requirements for the surrogate mother, and Article 59 is the legal consequences of the surrogacy contract.
• Content: The intended parent in a surrogacy arrangement can only be a citizen of Kazakhstan who is in a registered marriage state. Foreigners and singles are excluded.
• Obligations of intended parents (for national citizens): Bear the surrogate mother’s medical examination costs, assisted reproductive technology costs, all medical expenses during pregnancy and delivery, and 56 days after delivery (70 days in case of complications); health certificates and genetic test results of both parties must be submitted.
• Trigger: In December 2025, a government investigation determined that there was a network of exploitation of women and children and illegal egg donation in the industry.
• Transitional Clauses: There are no clear transition arrangements for cases in progress in public reports. This is consistent with previous legislative precedents in Central Asia, where legislation is often tightened without a grace period.

There is no official explanation on the legal application of cases in transit in public reports.

Thailand 🔴 (but there are variables, see below)

The 2015 "Law on the Protection of Children Born Through Assisted Reproductive Technology" prohibited commercial surrogacy by foreigners, which was the first domino to start the closure wave in Southeast Asia that year.

BUT: From July 2 to July 31, 2026, Thailand held a public consultation on the draft revision of the law. The direction of the draft is partially open: it is proposed to allow foreign married couples to carry out surrogacy in Thailand, and to connect with the Marriage Equality Act that takes effect on January 23, 2025, allowing registered same-sex couples to use assisted reproductive technology.

But there is a condition in the draft that almost cancels its significance to Chinese families: the surrogate mother must have the same nationality as one of the intended spouses; Thai women are still not allowed to be surrogates for foreign couples (except for blood relatives).

The actual meaning is: If Thailand legislates according to this plan, a Chinese couple who wants to have a legal surrogacy in Thailand needs to bring a Chinese surrogate mother into Thailand. Under China's current laws, this path is almost impossible.

The actual scope of application of Thailand's draft law amendment is substantially different from descriptions such as "Thailand is about to liberalize surrogacy."

India 🔴

Surrogacy (Regulation) Act, 2021: Only altruistic surrogacy is allowed and only for Indian citizens. Foreigners are completely excluded.

Cambodia 🔴

A total shutdown followed a Ministry of Health ban in 2016, and enforcement was so severe that surrogate mothers themselves were criminally prosecuted. The cross-border network between Cambodia-Vietnam-China has since been disrupted by Vietnam many times (including an operation to rescue 11 babies). This is the category with the worst humanitarian consequences among all destinations, and there are open cases for review regarding cross-border networks and humanitarian risks.

Nepal 🔴

It closed about five months after opening in 2015.

Laos 🟤 (grey with tightening expected)

After Cambodia closed its doors, some operations moved to Laos, but Laos has no written laws and is widely expected to follow suit with restrictions. Belongs to the highest risk category in the gray area.

Chapter 4 Yellow-List Jurisdictions: Four Countries Requiring Reassessment

These four countries are still offering programmes, and they all describe it as "legal" to the outside world. Its risk structure has changed materially over the past twelve months; one country's core channel is no longer legally viable.

4.1 Kyrgyzstan 🟠 — The Door Is Still Open, but a Hand Is on the Handle

Current legal basis

• Article 57 of the Law on the Protection of Citizens’ Health of the Kyrgyz Republic No. 14 of January 12, 2024 establishes the basic conditions for surrogacy.
• Cabinet Resolution No. 616 of October 14, 2024 (signed by Prime Minister Akylbek Japarov), published in the Official Gazette "Erkin-Too" No. 81 on October 18, 2024, entered into force 10 days after publication. This resolution is the core document at the operational level.
• Article 104 of the "Citizens' Health Protection Law" stipulates the notarization of surrogacy contracts, surrogate mother conditions and birth registration procedures, which is the target of revisions in this round of drafts - the August 11th draft proposed to limit this article to "open surrogacy contracts only to Kyrgyz citizens."

Specific rules established by resolution:

• Surrogate mother conditions: 20-35 years old; have at least one healthy biological child; medical genetic counseling must be completed; written informed consent is required; if married, written consent of the spouse is required.
• Obligations of intended parents: Bear all medical expenses of the surrogate mother during pregnancy, delivery and postpartum; Funds must be deposited in a special bank account; cannot refuse to accept the child after birth registration.
• Medical indications (Article 14): Absence of the uterus (congenital or acquired), uterine malformation that prevents pregnancy, endometrial lesions, physical diseases that contraindicate pregnancy, repeated transfer failure of high-quality embryos, etc.
• Procedure: A notarized contract must be signed; after birth, the intended parents are directly registered as legal parents.
• According to this law, regardless of health status and marital status, citizens have the right to become parents through surrogacy - this article was the legal basis for Kyrgyzstan's previous friendliness to singles and unmarried couples.
• Regarding foreigners, under the legal system, the health rights of foreign citizens in Kyrgyzstan are connected with residence. In practice, the requirements for residence permits need to be confirmed with local lawyers on a case-by-case basis.

Two drafts this month, one from the Speaker himself

This is the latest and most important set of developments before the deadline for this article.

Draft 1 (exposed around August 11, 2026): Proposed by Deputy Speaker Bolot Ibragimov and Member of Parliament Chyngyz Azhibaev, it is proposed to limit the right to enter into a surrogacy agreement to Kyrgyz citizens, as well as transnational marriages in which one spouse is a Kyrgyz citizen and has formally registered marriage.

Draft 2 (delivered for public discussion on August 20, 2026): proposed by Speaker (Тorаga) Marlen Mamataliev himself, the content is more severe than Draft 1:

• The right to use assisted reproductive technology (including surrogacy)is reserved only for Kyrgyz citizens and is subject to medical indications;
• The surrogate mother must also be a Kyrgyz female citizen;
• Foreigners and stateless persons are prohibited from using;
• Simultaneous increased criminal liability: Those who sell children through surrogacy are subject to a basic sentence of 8-15 years, and if the circumstances are aggravated, the sentence is 10-20 years and their property shall be confiscated.

Data cited in the legislative justification (this is the most critical set of figures in the full text):

Foreign intended parents account for approximately 90%. The proposer believes that the current system runs the risk of being used to illegally transfer and sell children.

The weight of the Speaker’s signature

In the legislative practice of Kyrgyzstan, bills signed by the Speaker of the Parliament are promoted at a significantly higher level than those proposed by ordinary members, indicating that the leadership of the Parliament has signalled a policy position on this issue. This is the direct reason why we upgraded Kyrgyzstan from "observation" to "high risk".

Current Stage: Both drafts are in the Public Discussion Stage and have not yet entered the first reading. Public reports did not give a time limit for discussion.

Opposition: Galina Chirkina, executive director of the Reproductive Health Alliance, publicly warned that the ban may be counterproductive and lead to the outflow of Kyrgyz women to Georgia or Germany to serve as surrogate mothers, forming a phenomenon of "surrogate migration". This is the most important resistance at present, but it is an industry-side objection and currently carries less institutional weight than a bill sponsored by the Speaker.

Background data: Chinese visits to Kyrgyzstan reached 127,956 in 2024, a year-on-year increase of 56% (after the implementation of visa exemption for tour groups). This growth rate itself is part of the legislative pressure.

Kyrgyzstan is currently the only major destination in Central Asia that is open to foreigners and is supported by clear written laws and cabinet resolutions. It is also a country where all four leading indicators listed in Chapter 2 for closing the country appear, and a fifth feature has been added - the draft was personally proposed by the Speaker and is accompanied by criminal liability provisions.

Referring to the approximately seven-month rhythm from investigation to legislation taking effect in Kazakhstan, an surrogacy journey launched in the second half of 2026 has the possibility of encountering legal changes before completion. If Mamataliev's version is passed, the clause "the surrogate mother must be a Kyrgyz citizen" will also affect the supply chain of Armenia and other countries that rely on Kyrgyz foreign surrogate mothers (see 4.3).

4.2 Georgia 🟠 - The law has not changed, but the industry has collapsed once

Georgia is the country that requires the most detailed discussion in this article. Because its legal risks and practical risks must be assessed separately.

Legal aspect: relatively stable

• It has permitted surrogacy since 1997, making it one of the earliest in the world.
• The basis is Article 143 of the Georgian Health Care Law, which allows the embryo to be transferred into the uterus of another woman (surrogate mother) if the wife does not have a uterus.
• Georgia does not have specific surrogacy laws. Supervision relies on medical institution licensing and general medical regulations, and administrative jurisdiction is fragmented—multiple reports indicate that the Ministry of Health has given inconsistent accounts of which authority holds regulatory responsibility.
• The names of the intended parents are directly registered on the birth certificate, and the name of the surrogate mother does not appear.

The attempted closure in 2023

In June 2023, then Prime Minister Irakli Garibashvili announced that he planned to ban commercial surrogacy by foreigners, leaving only altruistic surrogacy for Georgian citizens, and planned a comprehensive ban on surrogacy advertising, which was originally planned to be implemented on January 1, 2024.

Outcome: Postponed indefinitely in December 2023, draft withdrawn from parliamentary committee. As of August 2026, the draft has not been adopted and the current legal framework remains unchanged.

Therefore, the statement that "Georgia has banned surrogacy" is inconsistent with the facts. At the same time, the country's actual operational risks are higher than its legal risks.

Industry level: Already collapsed once

Data from the Ministry of Justice of Georgia: Between April 2012 and September 2022, a total of 4,026 children were born in Georgia through surrogacy, with Chinese intended parents predominating. Pre-war comparative data shows that Chinese intended parents accounted for approximately 14% of the Georgian market and 54% of the Ukrainian market. After the Russia-Ukraine war, with the transfer of Ukrainian business, the proportion of Chinese intended parents in Georgia further increased. From 2023 to 2024, the number of Chinese visits to Georgia will nearly triple, reaching more than 88,500 visits per year.

Then, in 2025, two things happened.

Event 1: BabyCam egg retrieval case (January 30, 2025)

Georgian police, with assistance from Thai authorities and Interpol, removed three Thai women from a surrogacy home in Tbilisi. According to the interviewees, their passports were confiscated upon arrival and they shared a house with about 30 Thai women; they were not arranged for surrogacy and were actually required to undergo monthly egg retrievals and the eggs were provided to other women for IVF procedures.

The entity identified was BabyCam Medical Consulting Group—a Chinese-backed company registered in Georgia in 2024. Georgia's Ministry of Internal Affairs has opened an investigation into human trafficking.

Event 2: Kinderly Collapse and Verdict

• Kinderly was founded by the Ukrainian side and opened in Tbilisi in 2022. It is a typical example of undertaking the post-war business transfer in Ukraine.
• In February 2025, an infant died on its premises, sparking an investigation.
• The agency stopped paying surrogate mothers on time, cut off daily life support, and moved at least 17 surrogate mothers and 10 children into a shabby hostel in a remote urban area of ​​​​Tbilisi. Many surrogate mothers reported that there was no gas, heating or hot water during the coldest winter in Georgia.
• In March 2025, more than 15 surrogate mothers complained to the Attorney General's Office over unpaid wages. The contract stipulated that each person would be paid $16,000, and they received nothing after the birth.
• In early 2025, the agency declared insolvency.
• On October 2, 2025, the general manager, Armenian Armen Melikyan, was detained; the Ukrainian co-founder Ruslan Tymoshenko was charged in absentia.
• On June 30, 2026, the Tbilisi City Court sentenced the two to 10 years in prison each and found them guilty of misappropriation of funds. The case identified 40 victims, including 30 surrogate mothers and 10 intended parents; the reported amount involved ranged from US$670,000 to US$757,000.

The judgment found that the funds involved mainly came from Chinese citizens.

The source countries of surrogate mothers include Russia, Ukraine, Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, Thailand, and Nigeria. The agency recruits in Central Asia, East Asia, and Africa through social media, and differential compensation is implemented based on nationality—the promised range is US$12,000 to US$17,000, but the actual monthly payment is only US$300 to US$500. Contracts generally include a clause "no compensation for pregnancy loss".

Georgia's current law is medium-risk and the draft is still pending, but the Kinderly case illustrates another layer of risk: 10 intended parents suffered financial losses despite having signed perfectly legal contracts in a country where such arrangements were lawful. The legality of the destination country alone does not prevent institutions from misappropriating funds.

4.3 Armenia 🔴 - the biggest collective misunderstanding in the Chinese market

Armenia is the country recommended the most by intermediaries in this article, but has the largest gap between the actual legal situation and the publicity.

We found the current consolidated text of the Law on Human Reproductive Health and Reproductive Rights on the Armenian Legal Information System (ARLIS) and checked Article 12 verbatim. The conclusion is inconsistent with the claims circulating on the market, and the difference is decisive.

Based on the premise of "ordinary Chinese citizens, non-Armenian ethnic groups, and no Armenian nationality", the conclusions for the four categories of applicants are as follows:

Verifiable Framework

• Legal Basis: The Human Reproductive Health and Reproductive Rights Law, passed on December 11, 2002 and effective on July 7, 2003; has been revised many times in 2010 (ՀՕ-157-Ն), 2012 (ՀՕ-85-Ն), etc.; the most recent major revision was July 12, 2024 ՀՕ-317-Ն.
• Age: The upper age limit for intended parents is 55 years (53 for a woman carrying the pregnancy herself); the surrogate mother is 20-38 years old.
• Other conditions for surrogate mothers: At least one child, no more than 3 deliveries in total, no more than 1 cesarean section, and must pass medical screening.
• A surrogate mother may not also serve as an egg donor (Article 15, paragraph 5).

Article 12, paragraph 1.1 (original text checked)

This paragraph stipulates that the right to use assisted reproductive technology through surrogacy does not apply to the following three categories of people:

Item (գ) is the key to the whole article. Its precise meaning is:

Foreigners who do not have Armenian ethnic identity are not allowed to use surrogates with Armenian nationality.

This article is different from the popular saying that "Armenia prohibits its citizens from surrogacy for foreigners". The law does not completely prohibit Armenian women from being surrogates for foreigners. It sets an ethnic threshold: Armenian foreigners (diaspora) can use Armenian surrogate mothers, but non-Armenian foreigners cannot.

For Chinese families, the conclusion is very straightforward: Chinese intended parents do not belong to the "Armenian ethnic group" in most cases, and are therefore legally excluded from using Armenian surrogate mothers.

Article 12, paragraph 1.2: Dual-donor schemes also closed

The paragraph further stipulates that when both intended parents are not the biological parents of the future child (i.e. the use of donor eggs and sperm), approval must be obtained from the Interdepartmental Committee (միջգերատեսչական հանձնաժողով, whose composition and operating rules are determined by the Government of Armenia), and this right applies only to:

1. Citizens of the Republic of Armenia - couples whose marriage has been registered, or unmarried women;
2. Armenian foreigners who hold Armenian ethnic certification documents issued by religious and community institutions and state agencies and legally reside or stay in Armenia - couples with registered marriages, or unmarried women.

The result of combining the two items

• Non-Armenian foreigners → cannot use Armenian surrogate mothers (1.1 գ);
• Foreigners of non-Armenian origin → the two-donor scheme is also not open (1.2);
• Unmarried men who are not the biological father → completely excluded (1.1 ա);
• Women without medical contraindications to pregnancy → completely excluded (1.1 բ, i.e. there must be a medical indication).

So what is the "Armenia programme" actually selling?

If an agency is still promoting Armenia to Chinese families, then the surrogate mothers it arranges must not be Armenian citizens—usually from neighboring countries such as Georgia and Central Asia.

The cross-border recruitment of foreign surrogate mothers is a common feature of the Georgian BabyCam case, the Kinderly case and the Greek Crete case, and is also a core element that triggers human trafficking charges and international law enforcement intervention (see Chapter 9 EU Directive 2024/1712). In this type of arrangement, the surrogate mother's residence, medical insurance, labor protection and relief channels are all in the most vulnerable state.

And the supply chain itself is collapsing: Kazakhstan has closed its doors on July 26, 2026, and Kyrgyzstan’s draft requires surrogates to be nationals (see 4.1).

Another development to watch: On October 22, 2025, Armenia’s Deputy Minister of Health Armen Gasparyan submitted a first-reading bill to the National Assembly, proposing to delete the age threshold in Article 12 based on the Constitutional Court’s ruling that age limits violate the protection of reproductive rights in Article 31 of the Constitution. The bill focused on age, and no ethnicity provision was included in public reports.

4.4 Ukraine 🟠 — The Law Remains Open, but War and a Draft Bill Constrain Access

• Current Status: Current law still allows married heterosexual foreign couples to use surrogacy.
• On August 22, 2025, the Cabinet of Ministers of Ukraine registered Bill No. 13683 "On the Application of Assisted Reproductive Technologies" with the Parliament.
• Placed on the parliamentary agenda in February 2026; still in committee as of May 2026 and requires further work before it can be put to a vote.
• The most critical provision of the bill: It is proposed to implement a permanent and comprehensive ban on the use of surrogacy by foreign intended parents; and require foreign intended parents to register with the government in advance and obtain a certificate issued by the state.
• Transitional Provisions: During the period of martial law and for 3 years after its end, the export of reproductive materials and embryos of Ukrainian citizens is prohibited.

Superimposed on the real risks of entry and exit, medical resources, and child departure under wartime conditions, Ukraine's current practical operability is at the lowest level among the countries listed in this article.

Chapter 5 United States: State Law Is Stable; Federal Rules Are Shifting

The United States remains the destination with the highest level of legal certainty in the world, and that remains unchanged. What changes is the last part of it.

State Law: Stable

Surrogacy in the United States is governed by state law, and the federal government does not directly regulate surrogacy itself. Friendly states include:

• California: Recognized globally as the gold standard. Gestational surrogacy agreements are fully enforceable under the California Family Code, pre-birth parentage orders are routinely issued, and are applicable to all types of family structures,including international intended parents.
• Nevada: Extremely friendly to intended parents. It clearly allows people of any marital status, sexual orientation, and genetic connection to obtain pre-birth parentage orders. There are no residency requirements and is especially friendly to international intended parents.
• Illinois: The process under the Gestational Surrogacy Act is highly standardized.
• Other statute-friendly states: Colorado, Connecticut, Washington, Oregon, Florida, New York, etc.

Pre-birth order is the core value of the American plan: intended parents are named on the birth certificate before the child is born, eliminating the need for postpartum adoption procedures and greatly reducing friction in the hospital.

Cost

• California, New York: Approximately $175,000 — $220,000+
• Texas, Illinois, Nevada, Colorado: approximately $135,000 – $180,000
• Among them, surrogate mother compensation: starting from about 45,000 to 50,000 US dollars in low-cost states; 60,000 to 75,000+ US dollars in high-compensation states such as California and Oregon.

Four layers of risk at the federal level

This is new after August 2026.

DETERMINED: June 30, 2026 Trump v. Barbara (25-365), the Supreme Court, 6-3, overturned the January 2025 executive order, reaffirming that the Fourteenth Amendment’s Citizenship Clause is broad with narrow exceptions.

NEW UNCERTAIN: EO 14418 and EO 14419 on August 6, 2026.

For Chinese families who use surrogacy in the United States, they need to understand the risks in layers:

Tier 1: The child’s citizenship itself. Section 2(c) of EO 14418 literally covers "commercial transactions with surrogate mothers who are present in the United States." However, this article is based on the premise that "neither parent is a U.S. citizen" and is in direct conflict with the Supreme Court's decision two months ago. As a legal inference, this provision is likely to be struck down. But "highly likely to be overturned" does not mean "now invalid" - before being blocked by the court, the administrative agency will issue guidelines accordingly.

Level 2: Actual issuance of documents. The actual impact of this layer is greater than the first layer. The Departments of State and Homeland Security are required to issue enforcement guidance within 30 days. This means that starting from September 2026, newborn passport applications, consular reports and other aspects may undergo additional review, require supplementary materials, or be put on hold. For individual cases, the practical effect may be similar between "delayed for six months" and "rejected".

The third level: visa and entry. EO 14419 is actually potentially more consequential in practice than EO 14418. It authorizes the denial or revocation of non-immigrant visas, permanent inadmissibility and deportation when there is "reason to believe" that the purpose of entry is to give birth in the United States. China is a country that requires B-2 visas and is a directly affected group.

Intended parents in surrogacy arrangements usually do not fall into the "pregnant woman entering the country to give birth" situation. The core definition of EO 14419 is that a foreigner enters the United States with a non-immigrant visa to give birth. The pregnant woman in the surrogacy arrangement is a surrogate mother who is already in the United States, and does not directly refer to the intended parents. The order also authorizes actions against "entities, organizations, and individuals at home and abroad that assist or promote birth tourism." The wording is broad and may affect service agencies.

Level 4: Institutional risk. If assisting agencies become targets of law enforcement, the chain of services may be disrupted. This is a new category of risk that did not exist before.

Three new actions as of press time

In the two weeks after the executive order was signed, three things happened in opposite directions that must be viewed separately.

1. Litigation has been initiated (August 11, 2026)

The American Civil Liberties Union (ACLU) and a coalition of other civil rights organizations have filed a lawsuit in the federal court in New Hampshire, arguing that the two executive orders "improperly attempt to expand the narrow historical exception recognized by the Supreme Court in Trump v. Barbara" and conflict with the civil rights clause of the Fourteenth Amendment. The plaintiffs asked the court to either affirm that the injunction previously issued in Trump v. Barbara also barred enforcement of the new order, or to issue a separate injunction regarding the new order.

2. The Department of State establishes a specialised enforcement task force (August 12, 2026)

The U.S. Department of State announced the establishment of the Birth Tourism Prevention Task Force, which will work with the Department of Homeland Security and other federal agencies to analyze information, review the travel activities of visa holders, identify suspicious birth tourism arrangements, and disrupt the networks that facilitate them.

• The State Department said in an announcement that the action had resulted in the revocation of more than 600 visas worldwide; as of August 20, media reports reported that the number was closer to 900.
• Enforcement standards: Pregnancy itself does not constitute a reason for visa refusal, but if the consular officer believes that the applicant will give birth in the United States, it will be presumed that the purpose of entry is not allowed, unless the applicant provides evidence to refute it.
• The task force explicitly targets facilitators, naming those service providers who "present themselves as doulas, midwives or health consultants to assist travelers in concealing their true purpose of travel."

3. Implementation guidelines have not yet been issued

Agencies are required to issue implementation guidance within 30 days of the signing of the executive order, which is approximately early September 2026. As of the time of writing this article, the federal agency has not issued implementation guidance, which means that the specific application methods are still unresolved.

The difference between the two executive orders (most Chinese sources confuse them)

In the case of surrogacy, the pregnant woman (surrogate mother) is usually already in the United States and is not an incoming foreigner. Therefore, EO 14419 and the State Department Working Group do not literally refer directly to intended parents of surrogacy - but the wording of their enforcement authorization for "facilitators/agencies" is broad enough that it may still affect the service chain.

The only provision that directly relates to surrogacy is Article 2(c) of EO 14418. The statement "the United States completely bans surrogacy" is inaccurate; the actual impact of 14418 should not be underestimated.

The state law level in the United States has the highest level of legal certainty and has not been affected at all by this round of federal executive orders. New uncertainties have arisen in the federal citizenship documentation process—relevant lawsuits have been filed but have not yet been adjudicated, and implementation guidelines have not yet been issued, which means that the actual application situation at the federal level may change in the next 1 to 3 months.

Chapter 6 No Comprehensive Statute, Reliance on Case Law: Mexico, Colombia and Argentina

The common feature of these three countries is that there is no national statutory law and is supported by court decisions. This is both their opportunity and their risk.

6.1 Mexico 🟡

• No federal law. Only Tabasco (Article 380 bis et seq. of the Civil Code) and Sinaloa (Articles 282-297 of the Family Code) have express provisions; Coahuila and Querétaro expressly deny the validity of surrogacy agreements in their legislation. The remaining states are in limbo.
• Tabasco is no longer open to foreigners, so demand is turning to Sinaloa and other states without explicit regulations.
• 2021, Mexico’s Supreme Court (SCJN) ruled that Tabasco’s restrictions were unconstitutional.
• July 2025, SCJN established the elements of a surrogacy agreement of national significance through the amparo (constitutional protection order) procedure, opening a judicial channel for states without legislation.
• On February 3, 2026, the SCJN established mandatory jurisprudence standards that stipulate the complete legal process from the signing of the agreement to the order of an authorized judge to issue a birth certificate for a newborn baby.

The Supreme Court case in February 2026 established a procedure to follow, changing the previous situation where the outcome was unpredictable in every case. The nature of this approach is still a judicial procedure, which must be heard by the court. It is more time-consuming and uncertain than the pre-birth parentage order in the United States, and the laws of each state vary greatly.

Cost: Significantly lower than the United States, usually in the range of $60,000 - $100,000 (varying widely by state and institution).

6.2 Colombia 🟡

• No written law. Reliance on jurisprudence: C-133/20, T-968/2009, SU-696/2015, and T-127, T-232 of 2024.
• Private contracts are allowed, provided there is no exploitation of the gestational carrier.
• May 2025, the Constitutional Court once again urged Congress and the government to enact comprehensive legislation on assisted reproductive technology (including surrogacy contracts).
• Congress has received at least 16 bills (both advocating a ban and some advocating limited legalization), none of which have passed.
• On April 1, 2025, the High Court of Bogota issued a judgment limiting the legal boundaries of surrogacy contracts and their effects in the civil registration of newborns.

Colombia is in a state of "legal vacuum, with the Constitutional Court repeatedly asking Congress to legislate," but Congress has yet to take action. This legislative vacuum that has lasted for many years constitutes a kind of instability in itself: once Congress actually initiates legislation, the specific direction is currently unpredictable.

6.3 Argentina 🟡

There is no written law, relying on court rulings on a case-by-case basis, allowing the creation of embryos using donated gametes from both parties. National norms are currently being discussed. The transparency and verifiability of publicly available information are lower than those in Mexico and Colombia.

Chapter 7 Altruistic Models and Residency Thresholds: Canada, Greece and Kenya

What this group of countries have in common is that their laws are clear and their ethics are high, but their accessibility to Chinese families is limited.

Canada 🟢 (but only altruistic)

• Only altruistic surrogacy is allowed: no remuneration is allowed and only well-documented pregnancy-related expenses can be reimbursed, usually in the range of CAD$16,000 – CAD$36,000.
• Foreigners can use, which is the key to distinguishing Canada from countries such as Greece and South Africa.
• The payment itself is illegal, which means the motivational screening of surrogate mothers is completely different - and the matching period is significantly longer.

Canada has the clearest laws and the least ethical controversies among the countries listed in this article. Because it does not involve payment of remuneration, its bottleneck lies in the waiting time required for matching, not the law or cost.

Greece 🔴 (effectively closed to non-residents)

• Law amendment in May 2025: Both the intended mother and the surrogate mother must legally reside in Greece before the court will approve the surrogacy arrangement.
• This requirement applies retroactively to pending applications that have been submitted but have not yet been heard - some intended parents who submitted applications in good faith based on the old law are retroactively excluded, and the Greek local legal community is challenging this.
• The upper limit of compensation is set hard at 10,000€.
• The law only applies to heterosexual couples and single women, excluding men.
• Background: In 2023, a clinic in Chania, Crete, was investigated and 10 people were arrested on charges of child trafficking, falsification of in vitro fertilization procedures, etc. The police determined that 98 victims of human trafficking were tricked into acting as surrogate mothers and egg donors. The 2025 law amendment is a direct result of this case.

Foreigners who do not have Greek residence status are currently unable to make surrogacy arrangements through Greek court procedures. There was a gap of about two years between the exposure of the Cretan scandal and the coming into effect of the revised law.

Kenya 🔴 (Closing)

• It has been in a state of unwritten law for a long time, which is why it has been recommended by some intermediaries before.
• On November 1, 2025, the National Assembly of Kenya passed the Assisted Reproductive Technology Bill (2022) with amendments.
• Content: Commercial surrogacy is expressly prohibited, only altruistic surrogacy is allowed, and limited to Kenyans (divorced, widowed, and single people are also acceptable); intended parents are 25-55 years old; surrogate mothers are 25-45 years old and have at least one child and must pass medical and psychological evaluation.
• Penalty: Engaging in commercial surrogacy carries a maximum penalty of 10 years in prison or a fine of Ksh10 million.
• Current Status: Submitted to the Senate for consideration.

The legislative window is closing in Kenya with a new law setting criminal penalties for commercial surrogacy.

Chapter 8 Gray Zone: Northern Cyprus, Albania

• Cyprus: Lack of complete surrogacy legislation covering all situations, falling into a legal gray area. Since there is no express prohibition, the clinic can perform embryo transfer. In practice, it is open to singles, heterosexual couples, same-sex couples, and HIV-positive intended parents. Cost approximately $50,000 – $80,000.
• Albania: Common quotes are €50,000 – €100,000, lower under semi-altruistic arrangements. Has one of the vaguest laws among the countries listed in this article.

The core feature of the gray area is the lack of relief: when the surrogate mother regrets, the child has birth defects, the institution goes bankrupt, the authorities intervene, etc., the parties have no local law to invoke, and no court has clear jurisdiction. In comparison, Georgia still has Section 143 of the Health Care Act and an existing criminal judgment to invoke, which are not available in gray zone countries.

Chapter 9 The Fourth Dimension: Nationality Can Determine Whether Conduct Is Illegal

The content of this chapter is most easily overlooked.

When Chinese materials discuss cross-border surrogacy, they usually only deal with one issue: whether it is legal in the destination country.

After 2024, a complete assessment will require answers to two questions simultaneously:

1. Is it allowed by the destination country?
2. Will my country of citizenship hold me accountable for doing this abroad?

Italy: Extraterritorial Criminalisation

Law No. 169 of November 4, 2024, entering into force on December 3, 2024. Expand the crime of surrogacy in Article 12, Paragraph 6 of Law No. 40 of 2004 to apply to overseas activities: Italian citizens who perform surrogacy in countries such as the United States and Canada where surrogacy is fully legal can still be prosecuted under Italian law after returning to their country. Penalty from 3 months to 2 years, fine from 600,000 to 1 million euros.

This is the world's first clear "universal jurisdiction over surrogacy" legislation, and its symbolic significance is far greater than the actual number of prosecutions - it has created a legislative template that can be copied by other countries.

Spain: No change to criminal law, but registration

• Spain has prohibited surrogacy domestically since 2006.
• In December 2024, the Supreme Court ruled that the surrogacy contract was invalid and violated Spanish public order, and determined that surrogacy "involves the objectification of both the surrogate mother and the child."
• Starting from May 1, 2025 (BOE-A-2025-8647): Embassies and consulates abroad shall not register children born through surrogacy, and all ongoing applications will be cancelled; they shall not accept certificates issued by foreign countries identifying Spanish citizens as parents of children born through surrogacy.
• Intended parents must demonstrate a biological link to one of the intended parents or initiate a separate adoption process.

There is no criminal liability in Spain, but the same effect is achieved through the registration process: children born through surrogacy are not recognized as children of the intended parents in Spanish law.

Germany

Total prohibition under the 1990 Embryo Protection Act. Anyone who provides, arranges, or participates in surrogacy is subject to up to 3 years in prison or a fine—Doctors and intermediaries are punished, but intended parents are not punished. However, intended parents face significant obstacles in establishing parent-child relationships after returning home.

France

Domestic ban. Citizens who return to their country to establish parent-child relationships after overseas surrogacy still face serious obstacles, which need to be dealt with on a case-by-case basis through judicial channels.

EU level: Directive 2024/1712

• Effective July 14, 2024, Member State transition period July 15, 2026 (expired).
• For the first time, "surrogacy exploitation" is explicitly listed as an exploitative form of human trafficking - specifically referring to situations where women are forced or tricked into acting as surrogate mothers.
• At the same time, member states are required to criminalize the behavior of "knowing that the other party is a victim of human trafficking but still using its services."

The Directive changes the qualitative framework for cross-border surrogacy and incorporates it into the human trafficking law enforcement system. There are international coordination mechanisms for human trafficking, which was the legal basis for the intervention of Interpol and Thai authorities in the Georgian BabyCam case.

China: Administrative Prohibition and Indirect Criminal Exposure

For Chinese families, it is necessary to accurately understand the position of domestic law:

• Core basis: The former Ministry of Health's "Administrative Measures for Human Assisted Reproductive Technology" clearly stipulates that medical institutions and medical personnel are not allowed to perform surrogacy procedures in any form.
• Normative level: A ministerial rule. The State Council has not promulgated special administrative regulations on surrogacy, the Standing Committee of the National People's Congress has not legislated, and the Criminal Law contains no standalone offence named "surrogacy".
• Practical prosecution methods: In judicial practice, organizers are usually prosecuted for crimes such as illegal business operations, illegal medical practice, and trafficking in women and children. For example, in a case in Jiangsu in 2021, the person in charge of a surrogacy agency was sentenced to 5 years in prison for illegal business operations, and the illegal income was determined to be more than 3 million yuan.
• Legislative trends: In 2025, experts have suggested in public that clear prohibitions on surrogacy should be included in the criminal law.

Realistic implications for Chinese families:

1. Surrogacy is carried out in legal overseas countries. There are no criminal offenses directly against intended parents under current Chinese law. This is fundamentally different from the Italian model.
2. However, criminal liability may be involved if surrogacy is organised, brokered or facilitated within China – the risk mainly falls on the agency side, not the family side.
3. It is the legal-identity documentation chain described in Chapter 10 that has the real impact on families; the risk of punishment is not the main variable.

Chapter 10 The Legal-Identity Chain: Five Checkpoints from Birth Certificate to Household Register

No matter how legal the country is, no matter how cheap the price is, if the child cannot obtain a lawful route home, the pathway cannot be completed.

This chapter is about the common endpoint of all country pathways. Five passes, if any one breaks, the entire chain will fail.

Level 1: Obtaining a birth certificate

The key is who the parents are named on the birth certificate.

• Georgia, Kyrgyzstan: The names of the intended parents are registered directly, and the surrogate mother does not appear - this is the biggest practical advantage of these two countries before.
• Surrogacy-friendly U.S. states: With a pre-birth parentage order, the intended parents are included on the birth certificate before birth.
• Mexico, Colombia: Court procedures are required and the time is uncertain.

Second level: document authentication

This is a link that will undergo major changes after November 2023, but Chinese data will lag seriously behind.

The Convention Abolition of the Requirement for Authentication of Foreign Public Documents (Apostille Convention)will enter into force for China on November 7, 2023.

This means:

• For Convention parties: The double authentication process of "certification by the Ministry of Foreign Affairs of the country + consular authentication by the Chinese Embassy and Consulate in the country" is no longer required. You only need to obtain the Apostille issued by that state for use in China. Chinese embassies and consulates in relevant countries have suspended corresponding consular authentication services.
• For non-Convention countries: The traditional three-level certification is still required (local notarization → certification by the Ministry of Foreign Affairs of the country → consular certification by the Chinese embassy or consulate abroad).

The United States, Georgia, Kazakhstan, Kyrgyzstan, Mexico, Colombia and other major relevant countries are all parties to the Convention.

Level 3: Proof of parent-child relationship

Blood relationship is the core of the parent-child relationship review at the public security household-registration authority. There are two main ways of proof:

1. Certified medical certificate of birth abroad;
2. Forensic parentage test (DNA) report - currently the most reliable and versatile method in most areas.

The material requirements for proof of parent-child relationship vary depending on the content of the birth certificate, immigration documents, whether the child was born out of wedlock, and the rules of the place of residence. DNA parentage testing will be required in some cases, but "one party must be biologically related to the child" cannot be summarized as a unified legal condition applicable to all overseas birth registrations across the country.

Level 4: Travel documents and nationality

Whether a child has Chinese nationality should be determined in accordance with Article 5 of the Nationality Law, taking into account the nationality of the parents at the time of birth, whether the parents have settled abroad, and whether the child has acquired foreign nationality at birth. China does not recognize dual nationality; applying for or holding a foreign passport will affect the processing of documents at the embassy and consulates and the nationality recognition by the public security organs. However, the current Nationality Law does not include the article that "applying for a foreign passport will automatically result in the loss of Chinese nationality." The automatic loss rule in Article 9 is aimed at Chinese citizens who have settled abroad and voluntarily join or acquire foreign nationality.

This is particularly critical in the US scenario, where jus soli doctrine applies. Families need to confirm the Chinese nationality identification, U.S. citizenship, passport or travel document application path before the child is born. "Which passport to choose" cannot be regarded as a simple preference.

And EO 14418 creates new uncertainty precisely in this position—In cases where a child’s U.S. citizenship documents may be subject to additional scrutiny, nationality determinations and document paths must be verified separately.

Level 5: Household Registration

• Article 1071 of the Civil Code stipulates that children born out of wedlock have the same rights as children born within wedlock, and no organization or individual may harm or discriminate against them.
• In practice, the material requirements for overseas birth registration, nationality recognition, birth certificate, translation certification and parentage testing are not completely consistent in various places; whether registration is possible should be subject to case review by the public security authority of the place where the applicant plans to settle.
• But: China has become increasingly strict in verifying birth certificates and parent-child relationships for children born outside the country. Once materials are found to be fraudulent, at least they may require supplementary materials, or at worst they may be held criminally responsible for forging official documents from state agencies.

In the entire process of cross-border surrogacy, the single behavior with the highest legal risk is falsification of documents. If an organization promises that it "can help you process your birth certificate", "doesn't need to do a parentage test", or "has internal channels to complete household registration", such promises involve forging official documents from state agencies, and both the intended parent and the organisation may bear corresponding criminal liability.

Chapter 11 Three-dimensional comparison table

Conclusion: A cycle that is still changing

In 2015, Thailand closed its doors. In 2016, Cambodia closed its doors. In 2021, India closed its doors. In 2022, Russia shuts down. In 2025, Greece closed its doors to non-residents. On July 26, 2026, Kazakhstan closed its doors. On August 20, 2026, the Speaker of the Kyrgyzstan Parliament submitted the draft to the public for discussion.

The life cycle of destination countries shows a consistent pattern: after becoming a major destination, it will move towards restrictions or closures on average within 5 to 10 years. The triggering mechanisms are, in order, influx of demand, regulatory lag, scandal outbreak, international pressure, and legislative shutdown.

Georgia has already taken the first four steps. Kyrgyzstan is between steps three and four.

The Hague Conference on Private International Law decided in March 2026 not to proceed with the Unification Convention for the time being. This means that in the next few years, the determination of parentage in cross-border surrogacy arrangements will still have to rely on the respective laws of the country of destination and the country of residence, and there is no unified international recognition mechanism.

The Kinderly case illustrates this risk in concrete terms: Ten groups of intended parents signed valid contracts in a jurisdiction where the arrangements were lawful. Their losses arose from the handling of client funds: the legal status of those funds in the event of the agency's insolvency had not been verified.