Civil Code of the People's Republic of China: Detailed Explanation

Author: Chief Editor: Jiang Ping
Publisher:
Publish Date: 1999-03-01
Features:
Fragment 2: Maintaining the Order of the Social Economy. "The order of the social economy" refers to the stable rules that ensure the normal operation of socio-economic activities. In a market economy-based society, the order of the economy is primarily maintained through legal means. The Contract Law stipulates the rules for establishing, modifying, and terminating the rights and obligations between natural persons, legal persons, and other organizations, and these rights and obligations are more often formed in socio-economic life. Therefore, contracts are important tools in economic transactions, and the adjustment of contract relationships by the Contract Law will directly affect the stability and order of the social economy. Thus, the Contract Law must necessarily aim to maintain the order of the social economy.
3. Promoting the Construction of Socialism with Chinese Characteristics. As the superstructure, law serves the economic base and serves the national economic and modernization construction. China is currently in the primary stage of socialism, and the fundamental task of the country is, based on the theory of building socialism with Chinese characteristics, to concentrate efforts on the modernization construction. As an important law, the Contract Law must serve the fundamental task of the country and serve the cause of modernization.
Article 2: In this Law, "contract" refers to an agreement between equal subjects, such as natural persons, legal persons, or other organizations, for establishing, modifying, or terminating civil rights and obligations. Agreements related to personal status, such as marriage, adoption, guardianship, and others, are governed by other laws. This article defines the concept of a contract. Civil rights and obligations relationships include many types, such as personal rights, ownership, creditor-debtor relationships, family, inheritance, etc. Contracts also have various types, including property contracts, creditor contracts, and status contracts. From the definition of contracts in the new Contract Law, it excludes the regulation of status contracts such as marriage, adoption, and guardianship. Therefore, the contracts referred to in this Contract Law should refer to property contracts, including property contracts and creditor contracts. However, from the analysis of specific provisions in the Contract Law, it mainly refers to agreements between civil subjects on creditor-debtor relationships, i.e., creditor contracts.
The old three Contract Laws did not explicitly define the concept of a contract, but from the provisions of the second article of the three Contract Laws regarding the subjects and content of the contract, it can be seen that each law defined the contract. The Economic Contract Law's subjects were "legal persons of equal civil subjects, other economic organizations, individual industrial and commercial households, and rural contract operators"; foreign-related economic contracts were economic contracts concluded between enterprises or other economic organizations in the People's Republic of China and enterprises or other economic organizations or individuals in foreign countries; and technical contracts were "contracts concluded between legal persons, between legal persons and citizens, and between citizens." The content of economic contracts was "rights and obligations relationships," while the content of technical contracts was "civil rights and obligations relationships." This Law unifies economic contracts, foreign-related economic contracts, and technical contracts as "contracts," clearly stating the concept of a contract, which defines contracts as property contracts to avoid ambiguity.
Contracts in civil law are divided into broad and narrow definitions. Broad contracts refer to agreements between two or more civil subjects for establishing, modifying, or terminating civil rights and obligations. Narrow contracts specifically refer to creditor contracts, i.e., agreements between two or more civil subjects for establishing, modifying, or terminating creditor-debtor relationships. Broad contracts, in addition to creditor contracts, also include property contracts, status contracts, etc. Furthermore, in addition to civil contracts, there are administrative contracts in administrative law and labor contracts in labor law, which are broader definitions of contracts. Therefore, the meaning of the term "contract" varies depending on the scope of use. The contracts referred to in this Law should be the narrow definition of contracts, meaning that the contracts in China's Contract Law mainly refer to creditor contracts.
The content of a contract is the regulation of creditor-debtor relationships. From the nature of the contract, it is a civil legal act. A civil legal act is a legally valid act implemented by civil subjects that can establish, modify, or terminate civil rights and civil obligations. Therefore, to correctly understand the concept of a contract, one must grasp the following points:
(1) A contract is the result of the agreement between parties, an agreement of two or more expressions of intent being consistent. The term "agreement" is sometimes used as a synonym for "contract" in civil law.
(2) Fundamentally, a contract is a legally valid act. Only when the expressions of intent made by the parties to the contract are legal does the contract have legal binding force.
(3) The subject of a contract is a civil subject, including natural persons, legal persons, and other organizations of equal subjects. In the original contract legislation, the term "citizen" was used, but since "citizen" is a constitutional term and cannot accurately reflect the meaning of civil law, this Contract Law has abandoned the use of "citizen" and adopted the scientific and accurate term "natural person." A "natural person" refers to a highly advanced mammal that is born according to natural laws, has flesh and blood, walks upright on two legs, and has a high level of abstract thinking ability. In the Contract Law, a natural person includes natural persons with Chinese nationality, natural persons with foreign nationality, and stateless natural persons. A "legal person" is an organization with civil rights capacity and civil action capacity, which independently enjoys civil rights and undertakes civil obligations according to law. "Other organizations" refer to units or groups that do not have legal person status. In China, they mainly include branches of enterprise legal persons, non-legal person public institutions engaged in business activities, and scientific and technological social groups, and so on.
(4) The content of a contract is the regulation of establishing, modifying, or terminating creditor-debtor relationships. "Creditor-debtor relationships" refer to the social relationships between the parties to the contract that arise from creditor-debtor relationships. The subject of this relationship is the parties to the contract, the object is the subject of the contract, and the content is the delivery and delivery request of the subject of the contract. "Establishment" refers to the establishment of creditor-debtor relationships; "modification" refers to changes in creditor-debtor relationships, such as changes in subjects, objects, or content; "termination" refers to the termination of creditor-debtor relationships. The content of the contract is reflected through contract terms, which include the names and addresses of the parties, the subject, quantity, quality, price or remuneration, performance period, performance location and method, liability for breach of contract, and methods for resolving disputes, and so on.