Contract Law of the Peoples Republic of China.docx

Contract Law of the Peoples Republic of China.docx

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ContractLawofthePeoplesRepublicofChina

ContractLawofthePeople'sRepublicofChina

（AdoptedattheSecondSessionoftheNinthNationalPeople'sCongressonMarch15,1999andpromulgatedbyOrderNo.15ofthePresidentofthePeople’sRepublicofChinaonMarch15,1999）

Contents

GeneralProvisions

ChapterICommonProvisions

ChapterIIMakingoftheContract

ChapterIIIValidityoftheContract

ChapterIVFulfillmentoftheContract

ChapterVModificationandTransferoftheContract

ChapterVITerminationofRightsandObligationsundertheContract

ChapterVIILiabilityforBreachofContract

ChapterVIIIMiscellaneousProvisionsSpecificProvisions

ChapterIXPurchaseandSaleContracts

ChapterXContractsfortheSupplyandConsumptionofElectricity,Water,GasorHeat

ChapterXIDonationContracts

ChapterXIILoanContracts

ChapterXIIILeaseContracts

ChapterXIVContractsforFinancialLease

ChapterXVWorkContracts

ChapterXVIConstructionProjectContracts

ChapterXVIICarriageContracts

ChapterXVIIITechnologyContracts

ChapterXIXContractsofDeposit

ChapterXXWarehousingContracts

ChapterXXIEntrustmentContracts

ChapterXXIIBrokerageContracts

ChapterXXIIIIntermediationContracts

SupplementaryProvisions

GeneralProvisions

ChapterICommonProvisions

Article1ThisLawisenactedforthepurposeofprotectingthelegitimaterightsandinterestsofthepartiestocontracts,maintainingthesocio-economicorderandpromotingthesocialistmodernization.

Article2ForthepurposeofthisLaw,acontractmeansanagreementontheestablishment,alterationorterminationofacivilright-obligationrelationshipbetweennaturalpersons,legalpersonsorotherorganizationsassubjectswithequalstatus.

Agreementsonestablishingsuchpersonalrelationshipsasmarriage,adoptionandguardianshipshallbegovernedbytheprovisionsofotherlaws.

Article3Thepartiestothecontracthaveequallegalstatus,andneitherpartymayimposeitswillontheother.

Article4Thepartiesshall,pursuanttolaw,havetherighttoenterintoacontractontheirownfreewill,andnounitorpersonmayunlawfullyinterfere.

Article5Thepartiesshallobservetheprincipleofequityindefiningeachother'srightsandobligations.

Article6Thepartiesshallobservetheprincipleofgoodfaithinexercisingtheirrightsandfulfillingtheirobligations.

Article7Thepartiesshall,inmakingandfulfillingthecontract,abidebylawsandadministrativeregulationsandrespectsocialethics,andmaynotdisruptthesocio-economicordernorimpairsocialandpublicinterests.

Article8Alegallyexecutedcontracthaslegalbindingforceontheparties.Thepartiesshallfulfilltheirobligationsascontracted,andmaynotarbitrarilymodifyorterminatethecontract.

Alegallyexecutedcontractisprotectedbylaw.

ChapterIIMakingoftheContract

Article9Thepartiesshall,whenmakingacontract,havecorrespondingcapacityforcivilrightsandcivilconduct.

Apartymay,inaccordancewiththelaw,entrustanagenttomakeacontract.

Article10Thepartiesmay,whenmakingacontract,usewrittenform,verbalformoranyotherform.

Thewrittenformshallbeadoptediflawsoradministrativeregulationssorequire.Thewrittenformshallbeadoptedifthepartiessoagree.

Article11"Writtenform"asusedhereinmeansanyformwhichrenderstheinformationcontainedinacontractcapableofbeingreproducedintangibleformsuchasawrittenagreement,aletter,orelectronictext（includingtelegram,telex,facsimile,electronicdatainterchangeande-mail）.

Article12Thecontentofacontractisdeterminedbythepartiesandgenerallyincludesthefollowingclauses:

（1）designationsornamesandaddressesoftheparties;

（2）thetargetedmatter;

（3）quantity;

（4）quality;

（5）priceorremuneration;

（6）time,placeandmodeoffulfillment;

（7）liabilityforbreachofcontract;and

（8）disputesettlement.

Thepartiesmaymakecontractswithreferencetovariousmodelcontractforms.

Article13Thepartiesshall,inmakingacontract,taketheformofofferandacceptance.

Article14An"offer"isanintentindicationshowingthedesiretoenterintoacontractwithothers,andtheintentindicationshallconformtothefollowingprovisions:

（1）thecontentindicatedshallbeconcreteanddefinite;

（2）theofferorshall,asisindicated,beboundbytheintentindicationuponitsacceptancebyanofferee.

Article15Aninvitationforofferisanintentindicationshowingthedesiretoreceiveoffersfromothers.Mailedordeliveredpricecatalogs,auctionannouncements,invitationsforbid,capital-raisingprospectusandcommercialadvertisementsaresuchinvitationsforoffer.

Acommercialadvertisementshall,ifitscontentconformstotheprovisionsregardingoffers,bedeemedanoffer.

Article16Anofferbecomeseffectivewhenitreachestheofferee.

Ifacontractismadeintheformoftextinelectronicdataandthereceiverhasdesignatedaspecialreceivingsystemtoreceivesuchdatatext,thetimeatwhichthetextinelectronicdataentersthedesignatedspecialsystemshallbethetimeofarrival;ifnospecialreceivingsystemisdesignated,thetimeatwhichthetextinelectronicdatafirstentersanyofthereceiver'ssystemsshallbethetimeofarrival.

Article17Anoffermaybewithdrawn.Thewithdrawalnoticeofanoffershallreachtheoffereebeforeoratthesametimeasthearrivaloftheofferattheofferee.

Article18Anoffermayberevoked.Therevocationnoticeofanoffershallreachtheoffereebeforethedispatchofanacceptancenoticebytheofferee.

Article19Anoffermaynotberevokedunderanyofthefollowingconditions:

（1）theofferorhasspecifiedatimelimitfortheacceptance,orhasexplicitlyindicatedinanyothermannertheirrevocabilityoftheoffer;

（2）therearegroundsfortheoffereetomaintaintheirrevocabilityoftheofferandtheoffereehasmadepreparationsforthefulfillmentofthecontract.

Article20Anofferlosesitseffectunderanyofthefollowingconditions:

（1）arejectionnoticeoftheofferhasreachedtheofferor;

（2）theofferorhasrevokedtheofferpursuanttolaw;

（3）whenthefixedtimelimitforacceptanceexpires,theoffereeundertakesnoacceptance;or

（4）theoffereemakesasubstantialchangeofthecontentoftheoffer.

Article21Anacceptanceisanassentindicationoftheoffereetoanoffer.

Article22Anacceptanceshallbemadeinformofanotice,unless,inlightoftradepracticesorasindicatedbytheoffer,theoffereemayindicatetheassentbyperforminganact.

Article23Anacceptanceshallreachtheofferorwithinthetimelimitfixedbytheoffer.

Ifnotimelimitisfixedbytheoffer,theacceptanceshallreachtheofferorinaccordancewiththefollowingprovisions:

（1）ifanofferismadeorally,acceptanceshallbemadepromptlyunlessthepartiesstipulateotherwise;and

（2）ifanofferisnotmadeorally,theacceptanceshallreachtheofferorwithinareasonableperiodoftime.

Article24Ifanofferismadethroughaletteroratelegram,thetimelimitforacceptancecommencesonthedateshownontheletteroronthedatethetelegramishandedinfordispatchor,ifnosuchdateisshownontheletter,fromthedateshownbythepostmarkoftheletter.Ifanofferismadebymeansofinstantaneouscommunicationssuchastelephoneorfacsimile,thetimelimitforacceptancecommencesatthemomentthattheofferreachestheofferee.

Article25Acontractisexecutedatthetimewhentheacceptancebecomeseffective.

Article26Theacceptancebecomeseffectivewhentheacceptancenoticereachestheofferor.Ifanacceptanceneedsnonotice,itbecomeseffectivewhenanactofacceptanceisperformedinlightoftradepracticesorasindicatedbytheoffer.

Whereacontractismadeintheformoftextinelectronicdata,theprovisionsofParagraph2,Article16ofthisLawshallbeapplicabletothetimeofarrivaloftheacceptance.

Article27Anacceptancemaybewithdrawn.Thewithdrawalnoticeoftheacceptanceshallreachtheofferorbeforeoratthesametimeastheacceptancenoticereachestheofferor.

Article28Iftheoffereemakesanacceptancebeyondthetimelimitforacceptance,itshallconstituteanewofferunlesstheofferornotifiestheoffereeintimethattheacceptanceiseffective.

Article29Ifanoffereemakeswithinthetimelimitforacceptanceanacceptancethatcouldreachtheofferorintimeundernormalconditionsbuthappenstoreachtheofferorbeyondthelimitduetootherreasons,theacceptanceshallbeeffectivenotwithstandingunlesstheofferornotifiestheoffereeintimethattheacceptanceisdeniedduetoitsdelayedarrival.

Article30Thecontentofanacceptanceshallbeconsistentwiththecontentoftheoffer.Iftheoffereeproposesanysubstantialchangetothecontentoftheoffer,itshallconstituteanewoffer.Changesrelatedtothetargetedmatter,quantity,quality,priceorremuneration,durationoffulfillment,placeandmodeoffulfillment,liabilityforbreachofcontractandmethodofdisputesettlementinacontractaresubstantialchangestothecontentofanoffer.

Article31Ifanacceptancemakesnon-substantialchangestothecontentoftheoffer,theacceptanceshallbeeffectivenotwithstandingandthecontentofthecontractshallthusbebasedonthecontentoftheacceptance,unlesstheofferorindicatesintimeitsobjectionthereto,orasindicatedintheoffer,theacceptancemaynotmakeanychangetothecontentoftheoffer.

Article32Ifthepartiesenterintoacontractintheformofacontractinstrument,thecontractisexecutedatthetimewhenbothpartiesputtheirsignaturesoraffixtheirseal