Das Oberste Volksgericht interpretiert das chinesische Vertragsgesetz im Zeichen der Finanzkrise: Ein Zwischenbericht (The Supreme People's Court Interprets the Chinese Contract Law Under the Influence of the Financial Crisis: A Status Report)

Journal of Chinese Law (ZChinR), Vol. 16, No. 3, pp. 262-275, October 2009

Max Planck Private Law Research Paper No. 10/18

49 Pages Posted: 20 Nov 2010 Last revised: 30 Jan 2013

See all articles by Knut Benjamin Pissler

Knut Benjamin Pissler

Max Planck Institute for Comparative and International Private Law

Date Written: September 1, 2009

Abstract

After a first judicial interpretation in 1999, in 2009 the Supreme People's Court (SPC) has issued a second judicial interpretation on the "Contract Law of the People's Republic of China", which is to be applied by the Chinese courts since May 15, 2009. Under the influence of the financial crises the SPC in July 2009 issued another document titled "Guiding Opinion on Several Issues Concerning the Trial of Civil and Commercial Contract Disputes under Current Circumstances," in which the court further specifies its judicial interpretation on the contract law and comments on issues of the application of the contract law in the situation "caused by changes in the macroeconomic situation" the Chinese courts are currently confronted with.

In its judicial interpretation the SPC deals with five sections of the general part of the Contract law, specifically with (1) the conclusion of contracts (Articles 1 to 8), (2) the validity of contracts (Articles 9 to 15), (3) the performance of contracts (Articles 16 to 21), (4) the termination of contractual rights and obligations (Articles 22 to 26) and (5) the liability for breach of contract (Article 27 to 29).

The paper concludes that the SPC takes the role not only as a law interpreting authority, but also fills some gaps in existing legislation and (especially by introducing the legal institute of frustration of contracts to Chinese law) takes the functions of a quasi-legislator. At the same time it becomes evident that the SPC is using a more political than legal language which reminds readers of past times, when the "primacy of politics" was more present than it is in today's Chinese legal system. It has to be seen whether this is a signal of a general ideological realignment of Chinese judiciary or just a temporary measure taken in the face of the financial crisis.

Note: Downloadable document is in German.

Keywords: Supreme People's Court of the People's Republic of China, Judicial Interpretation, Contract Law, Conclusion, Validity, Performance and Termination of Contracts, Liability for Breach of Contract, Frustration of Contracts, Primacy of Politics

Suggested Citation

Pissler, Knut Benjamin, Das Oberste Volksgericht interpretiert das chinesische Vertragsgesetz im Zeichen der Finanzkrise: Ein Zwischenbericht (The Supreme People's Court Interprets the Chinese Contract Law Under the Influence of the Financial Crisis: A Status Report) (September 1, 2009). Journal of Chinese Law (ZChinR), Vol. 16, No. 3, pp. 262-275, October 2009; Max Planck Private Law Research Paper No. 10/18. Available at SSRN: https://ssrn.com/abstract=1706855

Knut Benjamin Pissler (Contact Author)

Max Planck Institute for Comparative and International Private Law ( email )

Mittelweg 187
Hamburg, D-20148
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