CONTRACT LAW OF P. R. CHINA
Adopted and Promulgated by the Second Session of the Ninth National People‘s Congress on March 15, 1999.
Translated & Compiled by John Jiang & Henry Liu
GENERAL PRINCIPLES
Chapter One: General Provisions
Article 1 Purpose
This Law is formulated in order to protect the lawful rights and interests of contract parties, to safeguard social and economic order, and to promote socialist modernization.
Article 2 Definition of Contract; Exclusions
For purposes of this Law, a contract is an agreement between natural persons, legal persons or other organizations with equal standing, for the purpose of establishing, altering, or discharging a relationship of civil rights and obligations.
An agreement concerning any personal relationship such as marriage, adoption, guardianship, etc. shall be governed by other applicable laws.
Article 3 Equal Standing of Parties
Contract parties enjoy equal legal standing and neither party may impose its will on the other party.
Article 4 Right to Enter into Contract Voluntarily
A party is entitled to enter into a contract voluntarily under the law, and no entity or individual may unlawfully interfere with such right.
Article 5 Fairness
The parties shall abide by the principle of fairness in prescribing their respective rights and obligations.
Article 6 Good Faith
The parties shall abide by the principle of good faith in exercising their rights and performing their obligations.
Article 7 Legality
In concluding or performing a contract, the parties shall abide by the relevant laws and administrative regulations, as well as observe social ethics, and may not disrupt social and economic order or harm the public interests.
Article 8 Binding Effect; Legal Protection
A lawfully formed contract is legally binding on the parties. The parties shall perform their respective obligations in accordance with the contract, and neither party may arbitrarily amend or terminate the contract.
A lawfully formed contract is protected by law.
Chapter Two: Formation of Contracts
Article 9 Capacity; Contract through Agent
In entering into a contract, the parties shall have the appropriate capacities for civil rights and civil acts.
A party may appoint an agent to enter into a contract on its behalf under the law. Article 10 Forms of Contract; Writing Requirement
A contract may be made in a writing, in an oral conversation, as well as in any other form.
A contract shall be in writing if a relevant law or administrative regulation so requires.
A contract shall be in writing if the parties have so agreed.
Article 11 Definition of Writing
A writing means a memorandum of contract, letter or electronic message (including telegram, telex, facsimile, electronic data exchange and electronic mail), etc. which is capable of expressing its contents in a tangible form.
Article 12 Terms of Contract
The terms of a contract shall be prescribed by the parties, and generally include the following:
(i) names of the parties and the domiciles thereof;
(ii) subject matter;
(iii) quantity;
(iv) quality;
(v) price or remuneration;
(vi) time, place and method of performance;
(vii) liabilities for breach of contract;
(viii) method of dispute resolution.
The parties may enter into a contract by referencing a model contract for the relevant contract category.
Article 13 Offer-Acceptance
A contract is concluded by the exchange of an offer and an acceptance.