The Chinese Civil Code: General Principles, Civil Rights, Legal Persons, Civil Obligations, and Civil Liability

1. Introduction

The adoption of the Civil Code of the People’s Republic of China on 28 May 2020 was a major development in the modernisation of Chinese private law. The Code entered into force on 1 January 2021, replacing a number of separate civil statutes and consolidating important areas of civil regulation into a comprehensive legislative instrument.

It is the principal source of general civil law in mainland China. Its provisions govern the legal status of natural persons and organisations, civil rights and obligations, property ownership, contractual relationships, personality rights, marriage and family relations, inheritance and tort liability. It also establishes general principles that influence the interpretation and application of other civil legislation.

The Code is significant not merely because of its size or legislative form. It represents an effort to organise the rules of private law into a coherent system while retaining the distinctive characteristics of China’s socialist legal order. It combines traditional civil-law subjects with provisions addressing contemporary issues such as personal information, privacy, environmental protection, digital property interests and emerging forms of commercial activity.

For foreign individuals and enterprises, the Civil Code is particularly relevant. It may govern a contract with a Chinese company, a property transaction, a claim for compensation, an employment-related civil dispute, a family relationship, an inheritance or the protection of personal and commercial interests. The Code also provides the domestic substantive-law framework that must be considered alongside the rules governing foreign-related civil relations.

The Chinese Civil Code should not, however, be understood as a complete replacement for every other statute affecting private relationships. Special legislation continues to regulate matters such as companies, labour contracts, intellectual property, foreign investment, product quality, consumer protection and foreign-related conflict of laws. The Civil Code supplies general principles and rules, while specialised legislation supplements or modifies those rules in areas where the legislature has established a more specific framework.

This article examines the Code’s historical background, structure, general principles, legal subjects, civil rights, legal persons, civil obligations and liability rules. It also considers its significance for foreign individuals and businesses operating in China.

2. Historical Development of Chinese Civil Law

2.1 The absence of a unified Civil Code in imperial China

Traditional Chinese law developed through a legal culture in which criminal, administrative, family and property matters were not organised according to the modern distinction between public and private law.

Imperial legal codes principally addressed criminal offences, administrative order, family status, property disputes and obligations within a unified framework of state regulation. Civil disputes existed and were regularly brought before local officials, but they were not governed by a comprehensive civil code in the modern European sense.

The imperial magistrate often performed administrative and adjudicative functions simultaneously. Contractual relationships, land transactions, inheritance and family obligations were regulated through a combination of imperial statutes, supplementary regulations, customary practices and local arrangements.

This historical structure is important because modern Chinese civil law did not simply continue an uninterrupted tradition of codified private law. It emerged through a process of legal transformation, foreign influence, institutional reform and socialist legislative development.

2.2 Late Qing legal reform and the introduction of modern civil legislation

During the late Qing period, the government initiated extensive legal reforms in response to domestic political pressures and foreign influence.

The reform movement sought to modernise the legal system, establish new institutions and introduce legal concepts associated with continental European legal traditions and Japanese codification.

A draft Civil Code was prepared in the final years of the Qing dynasty. Although it did not become a fully implemented code before the dynasty ended in 1911, it contributed to the development of modern Chinese private-law thinking.

The draft drew significantly on continental European models, particularly German and Japanese civil-law structures. It reflected an emerging distinction between civil rights, property, obligations, family relations and inheritance.

2.3 Civil law under the Republic of China

The Republic of China enacted a Civil Code in the 1920s and 1930s. Its five-part structure covered general principles, obligations, property, family and succession.

This legislative project was strongly influenced by continental civil-law traditions, especially German, Swiss and Japanese law. It became an important reference point for modern Chinese legal scholarship and civil-law development.

The historical distinction between the Republic of China and the People’s Republic of China must be maintained. The Republic of China was established in 1912, while the People’s Republic of China was established in 1949. The legal systems subsequently developed along separate institutional paths.

2.4 Civil legislation in the early People’s Republic

After the establishment of the People’s Republic of China in 1949, the new state undertook a major transformation of the existing legal order. Earlier legal institutions and legislation were substantially displaced, and the legal system developed within the framework of socialist political and economic organisation.

The early decades of the People’s Republic did not produce a comprehensive Civil Code. Instead, civil relationships were increasingly regulated through separate statutes, administrative measures, policy instruments and sectoral rules.

The changing economic structure also influenced the development of civil law. Under a centrally planned economy, many forms of private commercial activity were limited or organised through state institutions. The need for a comprehensive body of private-law rules became more pressing as economic reform expanded individual, collective and commercial activity.

2.5 Reform and opening-up: the development of modern civil legislation

The reform and opening-up period beginning in the late 1970s created new demands for legal regulation.

The expansion of private economic activity, foreign investment, contractual transactions and market relationships required clearer rules governing ownership, commercial obligations and legal responsibility.

Several major statutes contributed to the modern civil-law framework:

• The General Principles of Civil Law, adopted in 1986.
• The Contract Law, adopted in 1999.
• The Property Law, adopted in 2007.
• The Tort Liability Law, adopted in 2009.
• The Law on the Application of Laws to Foreign-Related Civil Relations, adopted in 2010.
• The General Provisions of Civil Law, adopted in 2017.

These laws developed separate areas of civil regulation and progressively established a more comprehensive system.

The 1986 General Principles of Civil Law were particularly important because they established basic concepts concerning civil subjects, civil rights, civil legal acts, civil liability and limitation periods.

The 1999 Contract Law provided a unified framework for contractual obligations, while the 2007 Property Law clarified ownership and other property rights. The Tort Liability Law subsequently developed rules concerning compensation and responsibility for injury and damage.

2.6 The codification project and adoption in 2020

The modern Civil Code project sought to consolidate existing civil legislation, resolve inconsistencies and introduce rules addressing contemporary legal and social developments.

The National People’s Congress adopted the Civil Code on 28 May 2020. It entered into force on 1 January 2021.

Upon its commencement, several major statutes were repealed, including the General Principles of Civil Law, the Contract Law, the Property Law and the Tort Liability Law. Their principal subject matter was incorporated into the new Code, although some provisions were revised, reorganised or supplemented.

The Civil Code therefore represents both codification and legal development. It is not simply a collection of earlier statutes placed under one title. It establishes a unified structure for private-law regulation and introduces provisions intended to respond to changing social, economic and technological conditions.

3. Structure and Organisation of the Civil Code

The Civil Code contains 1,260 articles organised into seven books. Its structure follows the familiar civil-law distinction between a general part, which establishes concepts applicable throughout private law, and specialised parts dealing with particular categories of civil relationships.

The seven books of the Chinese Civil Code

1. Book I – General ProvisionsFundamental principles, civil subjects, legal capacity, legal acts, agency, civil rights, civil liability and limitation periods.
2. Book II – Real RightsOwnership, possession, usufructuary rights, security interests and other rights in property.
3. Book III – ContractsFormation, validity, performance, modification, termination, breach and particular types of contract.
4. Book IV – Personality RightsLife, bodily integrity, health, name, likeness, reputation, honour, privacy and personal information.
5. Book V – Marriage and FamilyMarriage, family relationships, parental responsibilities, divorce and adoption.
6. Book VI – SuccessionStatutory inheritance, wills, legacies and administration of estates.
7. Book VII – Tort LiabilityCivil responsibility for infringement of rights, compensation, product liability, traffic accidents, medical injury, environmental harm and other forms of damage.

Source: Civil Code of the People’s Republic of China, adopted 28 May 2020. english.www.gov.cn+2

The division is significant. Book I supplies concepts used throughout the Code. For example, rules concerning capacity, legal representation and civil juristic acts may determine whether a contract is valid, whether a person can dispose of property, or whether a legal claim can be pursued.

The specialised books then apply these general concepts to particular relationships. The rules on contracts, for example, operate alongside the general provisions on civil juristic acts, while the tort provisions draw upon the general principles of civil liability.

The Code’s organisation also reflects the breadth of contemporary private law. It does not limit civil law to property and commercial obligations. Personality rights, family relations, inheritance and personal information receive distinct legislative treatment.

4. Fundamental Principles of Chinese Civil Law

4.1 Equality of civil subjects

The Civil Code regulates personal and property relationships between civil subjects of equal status. Article 2 identifies natural persons, legal persons and unincorporated organisations as participants in civil-law relationships.

Equality in this context concerns the legal character of the relationship. A government authority exercising regulatory powers does not ordinarily act as an equal private-law participant merely because it enters into a transaction. By contrast, when two companies conclude a commercial contract, their relationship is generally governed by the civil-law principle of equal status, subject to applicable special legislation.

The principle does not mean that every party possesses identical bargaining power or resources. It means that civil-law relationships are governed by legally recognised rights and obligations rather than an automatic hierarchy between the participants.

This distinction is important for foreign businesses. A Chinese company and a foreign company entering into a commercial agreement generally participate in a civil relationship as contracting parties, although foreign investment regulation, administrative approvals and other mandatory rules may also apply.

4.2 Protection of lawful civil rights and interests

The Code recognises the protection of lawful personal rights, property rights and other civil interests.

Its general provisions establish that civil subjects may enjoy and exercise rights within the limits prescribed by law. Other organisations and individuals must not unlawfully infringe those rights.

The principle extends across the Code. Ownership is protected through property-law rules; contractual rights through obligations and remedies; personal dignity and privacy through personality-rights provisions; and bodily integrity through tort liability.

The protection is not absolute. Civil rights must be exercised consistently with legislation, public order, good morals and the rights of others. Certain rights are also subject to special limitations, registration requirements or statutory procedures.

4.3 Voluntariness and freedom of civil activity

The principle of voluntariness recognises that civil subjects may establish, modify and terminate civil legal relationships according to their own intentions, within the limits of the law.

It is particularly important in contract law. Parties generally decide whether to enter into an agreement, whom to contract with, what lawful obligations to undertake and how to organise performance.

However, contractual freedom is not unlimited. A contract may be affected by mandatory legal provisions, public order, good morals, restrictions on regulated activities or rules protecting parties in legally recognised positions of vulnerability.

For example, parties cannot use a private contract to authorise an activity that requires a licence but has not been lawfully authorised. Nor can they contract out of mandatory protections where the legislation prohibits doing so.

4.4 Fairness and good faith

The principles of fairness and good faith are fundamental to the interpretation and performance of civil obligations.

Fairness concerns the reasonable allocation of rights and obligations. Good faith requires honesty, integrity and consistency in civil dealings.

Good faith can be relevant at several stages of a transaction:

• During negotiations, where parties must avoid certain forms of misleading conduct.
• At contract formation, when determining whether a party has acted honestly.
• During performance, where parties must comply with contractual obligations and applicable duties of cooperation.
• During the exercise of rights, where conduct may be restricted if it constitutes an abuse of rights.
• During the termination of a relationship, where duties concerning confidentiality or the protection of legitimate interests may continue.

The principle is particularly relevant where a contract contains uncertainty or where the parties dispute the meaning of a provision. Courts may consider the contract’s purpose, surrounding circumstances, negotiations, subsequent conduct and good-faith requirements when interpreting contractual terms.

4.5 Public order and good morals

Civil activity must comply with the law and must not violate public order or good morals.

This principle is broader than the requirement that a transaction comply with a specific technical rule. It allows the legal system to address arrangements that are incompatible with fundamental legal and social requirements.

It may become relevant when a contract’s purpose or substance conflicts with mandatory legal standards, or where a purported civil transaction is used to conceal unlawful conduct.

The concept must nevertheless be applied within the legal framework. It should not be treated as an unrestricted licence to disregard contractual obligations merely because one party later considers an agreement undesirable.

4.6 Environmental protection and sustainable use of resources

The Civil Code expressly incorporates the principle of conserving resources and protecting the environment.

This is particularly visible in the rules governing property, contracts and tort liability. The Code recognises that civil rights and economic activity operate within a wider framework of environmental responsibilities.

Environmental provisions include rules concerning the prevention of ecological damage, liability for pollution and ecological destruction, and the consequences of activities that harm protected environmental interests.

This approach is significant because environmental responsibility is not confined to administrative regulation. Civil liability may also arise where conduct causes legally recognised damage.

4.7 Custom and the application of law

The Code recognises that civil disputes should be resolved according to law. Where legislation does not contain an applicable provision, custom may be considered, provided that it does not violate public order or good morals.

Custom is not equivalent to any practice that happens to be common in a particular industry or locality. Its legal relevance depends on the conditions established by the Code and the court’s assessment.

This provision illustrates the relationship between written legislation and social practice. Although the Civil Code is a comprehensive statute, it does not assume that every possible civil relationship can be anticipated in advance by the legislature.

5. Civil Subjects: Natural Persons, Legal Persons and Organisations

5.1 Natural persons as civil subjects

Natural persons are individuals recognised as participants in civil-law relationships. The Code addresses their legal capacity, capacity for civil conduct, guardianship, residence and other aspects of legal status.

The distinction between capacity for civil rights and capacity for civil conduct is important.

Capacity for civil rights concerns the ability to enjoy rights and assume obligations. A natural person generally has this capacity from birth until death.

Capacity for civil conduct concerns the ability to perform legally effective civil acts independently. It depends on age and, in specified circumstances, the person’s mental and cognitive condition.

The distinction helps explain why an individual may possess property rights even when they cannot independently enter into every legally binding transaction.

5.2 Age and capacity for civil conduct

The Civil Code distinguishes between adults, minors with full or limited capacity, and persons who lack capacity for civil conduct.

An adult is generally a person who has reached the age of 18. Adults have full capacity for civil conduct unless a court determines that their ability to recognise or control their conduct is legally impaired in a manner covered by the Code.

Minors are subject to more specific rules:

• A minor below the age of eight generally lacks capacity for civil conduct and acts through a legal representative.
• A minor who has reached eight but is below 18 generally has limited capacity for civil conduct.
• A minor aged 16 or above who relies mainly on their own labour income for subsistence is treated as having full capacity for civil conduct.

A minor with limited capacity may independently undertake civil acts that are appropriate to their age and intelligence, as well as acts that are purely beneficial. Other acts generally require the consent or ratification of a legal representative, subject to the applicable rules.

These distinctions are relevant to contracts, property transactions, purchases, inheritance and other civil matters.

5.3 Guardianship

Guardianship provides legal protection and representation for persons who cannot independently exercise their civil rights and perform civil acts to the extent recognised by law.

Parents generally act as guardians of their minor children. Other guardians may be appointed or determined under the statutory framework where the ordinary arrangements do not apply.

The Code also addresses guardianship for adults who cannot fully recognise or control their conduct. In such cases, a guardian may be responsible for protecting the individual’s interests and assisting with legally relevant decisions.

Guardianship is not intended to create unrestricted authority over the person concerned. The guardian must act in the individual’s interests and respect their wishes and lawful rights to the extent required by the Code.

5.4 Declaration of disappearance and death

The Civil Code establishes procedures under which a people’s court may declare a person missing or dead when the statutory conditions are met.

A declaration of disappearance may be relevant where an individual has been absent for a prescribed period and their whereabouts are unknown. The court may appoint an appropriate person to manage the missing individual’s property.

A declaration of death has more extensive legal consequences. It may affect marriage, inheritance, property relationships and other legal matters.

These provisions help resolve uncertainty in legal relationships where a person has disappeared and cannot be located. They are particularly relevant to the administration of estates and the protection of family and property interests.

6. Legal Persons and Non-Legal-Person Organisations

6.1 The concept of a legal person

A legal person is an organisation recognised by law as having independent civil rights and obligations.

It can acquire property, enter into contracts, assume debts, sue and be sued in its own name, and participate in civil transactions separately from its members or founders.

The recognition of legal personality is fundamental to modern commercial activity. It allows a company or other organisation to maintain a legal identity distinct from the individuals who own, manage or operate it.

Under the Civil Code, legal persons are classified into different categories according to their purposes and institutional characteristics.

6.2 For-profit legal persons

For-profit legal persons include companies and other organisations established for economic purposes.

They generally operate through their own assets, organisational structures and authorised representatives. Their legal identity is separate from that of their shareholders or members, subject to exceptions established by law.

The Company Law provides the more detailed framework for the establishment, governance and operation of companies. The Civil Code supplies general principles concerning legal personality, representation, civil rights and obligations.

For foreign investors, the distinction is important. A company incorporated in China is generally a Chinese legal person even where its shareholders are foreign individuals or overseas corporations. Its domestic obligations arise from its own legal status and activities.

6.3 Non-profit legal persons

Non-profit legal persons are organisations established for purposes other than distributing profits to their members or founders.

They may include institutions, social organisations, foundations and other entities recognised under the applicable legislation.

Their activities are subject to the relevant rules governing establishment, governance, registration, property and permitted purposes.

The Civil Code provides general rules on their legal status, while specialised legislation regulates particular types of non-profit organisation.

6.4 Special legal persons

The Code also recognises special categories of legal persons, including certain public institutions, rural collective economic organisations, urban and rural cooperative economic organisations and other bodies identified by law.

These categories reflect the distinctive institutional structure of the Chinese economy and public administration.

Their civil-law status must be understood in the context of the legislation governing their establishment and functions. Not every public or collective organisation operates under the same rules as a commercial company.

6.5 Non-legal-person organisations

Not every organisation that participates in civil transactions has separate legal personality.

The Civil Code recognises non-legal-person organisations, which may include sole proprietorships, partnerships and professional service organisations that meet the relevant statutory requirements.

Such organisations can participate in civil activities in their own name within the scope recognised by law, but their liability arrangements differ from those of legal persons.

In particular, the property of the organisation may not provide a complete separation from the personal liability of its investors, partners or members. The applicable organisational legislation determines the extent and allocation of responsibility.

6.6 The legal representative

A legal person acts through its legal representative and other authorised personnel.

The legal representative is an individual designated under the law or the organisation’s governing documents to represent the legal person in civil activities.

The distinction between a legal representative and an ordinary employee is important. The authority of employees and agents may arise from different legal grounds, including statutory representation, organisational appointment or an express or implied agency relationship.

For commercial transactions, foreign companies dealing with a Chinese enterprise should examine the identity and authority of the person signing the agreement, the company’s registration information and any relevant authorisation documents.

A company seal may also be relevant to evidence and internal authority, but its presence or absence should not be treated as a complete substitute for analysing the legal rules governing representation and contract formation.

7. Civil Juristic Acts and Agency

7.1 The concept of a civil juristic act

A civil juristic act is an expression of intention intended to establish, modify or terminate a civil legal relationship.

Contracts are the most familiar examples, but the concept is broader. It can include declarations concerning property, authorisations, unilateral legal acts and other transactions recognised by law.

The Code regulates the formation and validity of such acts. The central questions include whether the person had the required capacity, whether the intention was genuine, whether the act complied with mandatory law and whether any legal defect affects its validity.

7.2 Validity and invalidity

A civil juristic act may be invalid where it falls within statutory grounds for invalidity.

Relevant grounds include serious violations of mandatory legal provisions, conduct contrary to public order or good morals, and malicious collusion intended to harm the lawful rights and interests of another person.

The Code also recognises circumstances in which a civil act is voidable or subject to revocation. These may include significant misunderstanding, fraud, coercion or exploitation of a person’s vulnerable position under the statutory conditions.

The legal consequences differ. An invalid act generally lacks the intended legal effect from the outset, while a revocable act may remain effective unless the entitled party exercises the right to seek revocation within the prescribed period.

7.3 Agency

Agency allows one person to perform civil acts on behalf of another within the scope of the authority granted.

The Civil Code recognises several forms of agency, including statutory agency and entrusted agency.

A statutory representative may act because the law assigns them authority, as in the case of a parent acting for a minor. An entrusted agent acts under authority conferred by the principal.

Agency is important in commercial practice because companies routinely act through directors, employees, agents, intermediaries and other authorised representatives.

The legal consequences of an agent’s conduct depend on the scope of authority and the applicable rules. Where a person acts without authority or exceeds the authority granted, questions may arise concerning ratification, apparent authority and liability.

7.4 Apparent agency and protection of third parties

The Civil Code recognises circumstances in which an act performed by a person without actual authority may nevertheless bind the principal because the legal conditions for apparent agency are satisfied.

This principle protects reasonable reliance in civil transactions, while also requiring attention to the circumstances in which the apparent authority arose.

For foreign businesses, the practical importance is considerable. When contracting with a Chinese company, it is prudent to verify who is authorised to negotiate, sign and perform the agreement. A company’s internal approval procedures, registered legal representative and specific powers of attorney may all be relevant.

7.5 Electronic civil acts

The Code accommodates electronic forms of civil activity. A contract may be concluded through electronic data messages where the applicable legal requirements are met.

Electronic communications, online platforms and digital transactions therefore form part of the modern civil-law framework.

The validity of a particular electronic act may depend on matters such as identification of the parties, the reliability of the electronic record, the intention to be legally bound and compliance with any special formalities.

Other legislation, including the Electronic Signature Law and laws governing electronic commerce and data protection, may also apply.

8. Civil Rights and Their Legal Protection

8.1 Categories of civil rights

The Civil Code recognises several broad categories of civil rights. These include property rights, creditor’s rights, intellectual property interests, personality rights, marital and family rights, and inheritance rights.

The categories are interconnected. A commercial transaction may involve property ownership, contractual claims, personal information and intellectual property at the same time.

The Code’s general provisions establish that civil subjects enjoy rights in accordance with law and may seek legal protection when those rights are infringed.

8.2 Property rights

Property rights concern legally protected interests in things and other property recognised by law.

The Code distinguishes ownership from other real rights. Ownership provides the broadest legally recognised powers over property, while other rights may permit a person to use property, obtain benefits from it or hold security over it.

Property rights are especially important in commercial transactions, real estate, secured lending, construction, inheritance and the organisation of business assets.

8.3 Creditor’s rights

Creditor’s rights arise where one person is entitled to require another person to perform an obligation.

The most familiar example is a contractual debt. A supplier who delivers goods under a valid contract may have a claim for payment against the purchaser.

Creditor’s rights may also arise from other legal grounds, including unjust enrichment, management of another’s affairs without mandate and tort liability.

The distinction between a real right and a creditor’s right is important. A property owner generally has a right directly associated with the property, whereas a contractual creditor ordinarily has a claim against a particular debtor.

8.4 Intellectual property rights

The Civil Code recognises intellectual property as a category of civil rights, but the detailed regulation of these rights is principally found in specialised legislation.

China has separate statutes governing patents, trademarks and copyright, together with provisions concerning trade secrets and other protected interests.

The Code’s general provisions provide the broader civil-law context, including the recognition of intellectual property rights and the possibility of civil remedies for infringement.

For foreign businesses, protection in China must be considered territorially. A patent, trademark or copyright registration in another country does not automatically provide the same legal protection in mainland China. The applicable Chinese registration and protection rules must be assessed separately.

9. Book II: Real Rights and Property Law

9.1 The meaning of real rights

Book II of the Civil Code regulates rights in property. Its provisions address ownership, possession, usufructuary rights and security interests.

The Chinese term for real rights is wuquan. These are rights that allow their holder to exercise legally recognised control over a particular thing, subject to the limitations established by law.

The Code distinguishes between movable and immovable property. Immovable property includes land and buildings, while movable property includes other objects capable of being transferred.

The legal treatment of a particular asset depends on its classification and the applicable registration or transfer requirements.

9.2 Ownership

Ownership is the most comprehensive form of real right recognised by the Code.

An owner generally has the right to possess, use, obtain benefits from and dispose of property in accordance with law.

However, ownership is subject to legal restrictions. The exercise of property rights must comply with environmental, planning, land-use, public safety and other applicable rules.

The Code also recognises different forms of ownership, including state ownership, collective ownership and private ownership.

This reflects the distinctive constitutional and economic structure of China. Land ownership, in particular, differs from the private freehold systems familiar in some common-law jurisdictions.

9.3 Land ownership and land-use rights

Land is subject to a special legal framework in China.

Urban land is generally owned by the state, while rural and suburban land is generally owned collectively, subject to constitutional and statutory exceptions.

Individuals and businesses may obtain land-use rights and other legally recognised interests, but they do not ordinarily acquire unrestricted private ownership of the underlying land.

Urban land-use rights may be obtained through grants or other legally recognised arrangements. The term and conditions depend on the applicable land category, purpose and legal instrument.

Foreign individuals and businesses considering real estate transactions should therefore distinguish between ownership of a building or unit and the land-use rights associated with it.

This distinction is fundamental to understanding property transactions in China and is developed further in the dedicated land and property legislation.

9.4 Usufructuary rights

Usufructuary rights allow a person to possess, use or obtain benefits from property belonging to another, within the scope of the right.

The Civil Code regulates several types of usufructuary rights, including land-contract management rights, construction land-use rights, residential land-use rights and easements.

These rights are particularly important in agriculture, urban development, housing and infrastructure.

A construction land-use right, for example, may allow its holder to use a specified parcel of state-owned land for an authorised purpose and period, subject to the conditions of the grant and relevant legislation.

9.5 Security interests

The Code recognises security interests that allow creditors to obtain legally protected security over property.

These include mortgages, pledges and liens under the relevant statutory conditions.

A mortgage generally allows a creditor to obtain security over property without taking possession of it. A pledge ordinarily involves the transfer of possession of movable property or rights where the law permits. A lien may arise in specified circumstances where a creditor lawfully retains property as security for an obligation.

Security interests are important in commercial lending, project finance, asset-backed transactions and corporate borrowing.

Their creation, priority and enforcement depend on the statutory requirements, including registration where required.

9.6 Possession and protection of property

Possession is recognised as a legally relevant factual and legal relationship with property.

The Code provides mechanisms for protecting possession against unlawful interference. These protections are relevant even where the possessor is not the owner.

A tenant, for example, may possess premises under a lease and enjoy contractual and statutory protection against unlawful interference, even though the landlord retains ownership.

This illustrates why property disputes should not be reduced to the question of who holds title. Ownership, possession, use rights and contractual interests may belong to different persons.

10. Book III: Contract Law

10.1 The importance of contracts in the Civil Code

Book III is one of the most commercially significant parts of the Civil Code.

It regulates the formation, validity, performance, modification, transfer, termination and breach of contracts. It also contains rules governing numerous named contract types.

The Code replaced the former Contract Law of 1999, consolidating its principal rules while making changes and introducing additional provisions.

Contract law is central to the operation of China’s market economy. It governs sales, leases, services, construction, transport, technology, loans, guarantees, commissions and many other transactions.

10.2 Contract formation

A contract is generally formed through an offer and acceptance, although the Code recognises other legally relevant methods of formation.

The offer must satisfy the applicable requirements, including sufficient definiteness and an intention to be bound upon acceptance. Acceptance must correspond to the offer within the statutory framework.

The Code also recognises contracts concluded through electronic data messages and other modern forms of communication.

The precise point at which a contract is formed may be important for determining obligations, liability, applicable law and the effect of subsequent events.

10.3 Contract interpretation

Contract interpretation is not necessarily confined to reading individual words in isolation.

The Supreme People’s Court’s 2023 judicial interpretation concerning the general provisions of the Contract Book addresses the interpretation of contractual terms, formation, validity, performance and liability.

Courts may consider the ordinary meaning of the language, the relationship between clauses, the nature and purpose of the contract, relevant practices, the circumstances of negotiations and the parties’ conduct.

This is especially important in international transactions where contractual language may have been drafted by parties with different legal backgrounds.

A foreign company should not assume that a translation alone determines the meaning of a Chinese-law contract. Where the agreement is bilingual, the parties should clearly specify which language prevails in the event of inconsistency.

10.4 Performance and cooperation

Parties must perform their contractual obligations in accordance with the agreement and the law.

The Code recognises obligations of cooperation and good faith, which may require a party to provide relevant information, assist with performance or take reasonable steps to avoid unnecessary harm.

The parties must also comply with the agreed time, place, method and quality of performance, subject to the applicable legal rules.

Where performance becomes difficult or circumstances change, the Code provides mechanisms for dealing with modification, termination and other consequences, but a party cannot simply disregard its obligations because the transaction has become commercially unattractive.

10.5 Breach of contract

A party that fails to perform its contractual obligations or performs them inconsistently with the agreement may incur liability for breach.

Depending on the circumstances, remedies may include:

• Continued performance.
• Repair, replacement or re-performance.
• Compensation for losses.
• Liquidated damages where validly agreed.
• Other remedies permitted by the contract and the law.

The Code’s approach seeks to protect the legitimate interests of the non-breaching party while maintaining the legal requirements governing causation, foreseeability and the calculation of loss.

10.6 Force majeure and changed circumstances

The Civil Code recognises force majeure as an event that is unforeseeable, unavoidable and insurmountable under the statutory definition.

A party may obtain an exemption from liability, wholly or partly, where the relevant conditions are satisfied. However, the party must comply with applicable duties of notification and evidence.

The Code also recognises a doctrine concerning significant changes in the basic circumstances underlying a contract. Where the statutory requirements are satisfied, a party may request renegotiation or seek judicial or arbitral adjustment or termination in accordance with law.

This is not a general right to escape an unfavourable bargain. The relevant threshold is demanding, and ordinary commercial risk or a decline in profitability does not automatically justify modification.

10.7 Named contracts

The Contract Book regulates numerous types of contract, including:

• Sales contracts.
• Supply and electricity-related contracts.
• Gift contracts.
• Loan contracts.
• Guarantee contracts.
• Lease contracts.
• Financing lease contracts.
• Factoring contracts.
• Construction contracts.
• Transportation contracts.
• Technology contracts.
• Storage and warehousing contracts.
• Agency and commission contracts.
• Brokerage contracts.
• Partnership contracts.

These rules are supplemented by special legislation where relevant.

For foreign businesses, identifying the correct legal category can be important because different contractual relationships may have different mandatory requirements, remedies and limitation rules.

11. Book IV: Personality Rights

11.1 A separate book devoted to personality rights

One of the most distinctive features of the Chinese Civil Code is its separate book on personality rights.

The inclusion of a dedicated book reflects the legislature’s decision to give systematic treatment to personal dignity, bodily integrity, privacy, reputation and related interests.

Personality rights concern the legally protected attributes of an individual as a person. They are distinct from property rights because their principal object is not the ownership of an economic asset but the protection of personal identity, dignity and integrity.

11.2 Life, bodily integrity and health

The Code recognises the rights to life, bodily integrity and health.

These rights protect individuals against unlawful interference and provide a basis for civil remedies where injury or harm occurs.

The provisions operate alongside the Tort Liability Book, which establishes the consequences of conduct causing personal injury or other legally recognised damage.

Medical treatment, workplace accidents, traffic collisions and other situations may therefore involve both personality-rights provisions and tort liability.

11.3 Name, likeness and reputation

The Code protects the right to a name, the right to a likeness, reputation and honour.

The right to a name protects an individual’s legally recognised identity. The right to a likeness concerns the use and protection of a person’s image. Reputation and honour provisions address unlawful conduct that damages a person’s standing or dignity.

These provisions are relevant to advertising, publishing, social media, commercial endorsements, photography and online content.

Businesses using images, names or personal endorsements should consider whether they have obtained the necessary authorisation and whether their use complies with the relevant statutory requirements.

11.4 Privacy

The Code recognises privacy as a personality right.

Privacy protection concerns the private life of natural persons and the private spaces, activities and information associated with them, subject to the legal definition and limitations.

The provisions may be relevant to the unlawful disclosure of private communications, intrusion into private spaces, misuse of personal information and other forms of interference.

Privacy protection is closely connected with the Personal Information Protection Law, which establishes a more detailed regulatory framework for the processing of personal information.

11.5 Personal information

The Civil Code establishes that personal information is legally protected.

Organisations and individuals collecting or using another person’s personal information must comply with applicable law and protect the security of that information.

The Personal Information Protection Law provides the principal specialised framework for matters such as lawful processing, transparency, consent where required, sensitive personal information, individual rights and cross-border transfers.

The two instruments should be read together. The Civil Code establishes the civil-law protection of personal information, while the specialised statute provides more detailed rules governing processing activities and regulatory obligations.

11.6 Personality-rights remedies

Where personality rights are infringed, the affected person may be entitled to seek civil remedies under the Code.

Depending on the circumstances, these may include cessation of infringement, removal of the consequences, restoration of reputation, an apology and compensation for losses.

The Code also recognises preventive remedies in certain circumstances. A person facing an imminent infringement that may cause difficult-to-repair harm may apply for a court order under the statutory conditions.

This is significant for online publication, privacy violations and other conduct where waiting until the damage has fully occurred may be inadequate.

12. Book V: Marriage and Family

12.1 Family relationships within civil law

Book V regulates marriage and family relationships, recognising that these relationships create legally protected personal and property interests.

The Code addresses marriage, relations between spouses, relations between parents and children, divorce, adoption and other family matters.

Although family relationships have personal and social dimensions, they also produce civil legal consequences. These may concern property, maintenance, parental responsibilities, inheritance and the legal status of family members.

12.2 Marriage

The Code establishes legal requirements for marriage, including the age and consent conditions prescribed by law and the registration procedure.

Marriage is based on the voluntary consent of the parties. The legal framework prohibits specified forms of marriage and establishes circumstances in which a marriage may be invalid or subject to revocation.

The legal consequences of marriage extend beyond the personal relationship. They affect property acquired during marriage, financial obligations, family support and succession.

Foreign nationals marrying Chinese citizens should also consider the applicable registration and foreign-related family-law procedures. The Civil Code must be read together with the relevant rules governing foreign-related civil relations and marriage registration.

12.3 Property relations between spouses

The Code provides rules concerning marital property.

The statutory framework distinguishes between property belonging to one spouse individually and property treated as jointly owned by the spouses.

Property acquired during marriage may fall within the category of joint marital property, subject to the statutory provisions and recognised exceptions. Property acquired before marriage, certain personal property and other specified categories may remain individually owned.

Spouses may also make agreements concerning the ownership and management of property, provided that the arrangement satisfies the applicable legal requirements.

This distinction can become important in divorce, inheritance, debt disputes and transactions involving assets acquired during marriage.

12.4 Parents and children

The Code regulates the legal relationship between parents and children.

Parents have duties concerning the upbringing, protection and education of their minor children. Children have corresponding legal interests and rights within the family relationship.

The law also addresses maintenance and support obligations involving adult children and parents in the circumstances prescribed by the Code.

The framework includes protection of minors and the recognition of parental responsibilities. It must be considered alongside other legislation protecting children and regulating education, adoption and welfare.

12.5 Divorce

The Civil Code recognises divorce by mutual agreement and divorce through judicial proceedings.

Divorce by agreement involves the parties’ consent and completion of the applicable registration procedure. The law includes a 30-day cooling-off period following the submission of a joint divorce registration application, after which the parties must complete the subsequent procedure within the prescribed period.

Judicial divorce may be sought where the parties cannot reach agreement or where the statutory conditions for a court-ordered divorce are satisfied.

The Code also addresses the division of marital property, child-related arrangements, maintenance and compensation in specified circumstances.

12.6 Adoption

The Code regulates the establishment, legal effects and termination of adoption relationships.

Adoption must comply with statutory requirements designed to protect the interests of the child and ensure that the legal relationship is properly established.

The relevant provisions address eligibility, consent, registration and the consequences of adoption. International or cross-border adoption may also involve additional legislation and international arrangements.

13. Book VI: Succession and Inheritance

13.1 The legal framework of inheritance

Book VI regulates the transfer of property and other inheritable rights and obligations following death.

It recognises two principal forms of succession: statutory inheritance and inheritance under a will or other legally recognised testamentary arrangement.

The rules seek to determine who may inherit, the order of succession, the effect of a will and the administration of the estate.

13.2 Statutory inheritance

Where a person dies without an effective will governing the relevant estate, statutory inheritance rules apply.

The Code establishes categories of heirs and an order of succession. Close family relationships are central to determining entitlement.

The first order generally includes the spouse, children and parents. The second order includes siblings and specified other relatives. The applicable rules determine when heirs in the second order may inherit.

The legal position may be affected by adoption, marital status, support relationships and other statutory circumstances.

13.3 Wills and testamentary succession

The Code recognises several forms of wills, including handwritten, printed, recorded, oral and notarised wills, subject to the statutory formalities applicable to each form.

A will must satisfy the relevant legal requirements concerning capacity, intention, form and execution.

The Code also addresses circumstances in which a will may be revoked, altered or invalidated.

Where several wills exist, the statutory rules determine how inconsistencies are resolved. The form and date of each instrument may therefore be important.

13.4 Legacies and estate administration

The Code allows a testator to leave property through a legacy and recognises legally relevant arrangements for the administration and distribution of an estate.

Estate administration may involve identifying assets, determining liabilities, establishing the identity of heirs, paying relevant debts and distributing the remaining property.

Where disputes arise, judicial proceedings may be necessary to determine entitlement or resolve disagreements concerning the validity or interpretation of testamentary documents.

13.5 Foreign-related inheritance

Inheritance becomes more complex where the deceased, heirs or property have connections with more than one country.

The Civil Code’s substantive inheritance rules must be read alongside the Law on the Application of Laws to Foreign-Related Civil Relations.

The applicable law may depend on factors such as the deceased’s habitual residence, the location and nature of the property, and the relevant conflict-of-laws provisions.

Foreign individuals with assets or family connections in China should therefore avoid assuming that the law of their nationality will automatically govern every part of an estate located in mainland China.

14. Book VII: Tort Liability and Civil Responsibility

14.1 The meaning of tort liability

Tort liability concerns civil responsibility for conduct that unlawfully infringes another person’s rights or legally protected interests.

The Civil Code’s Tort Liability Book consolidates and develops rules previously contained in the Tort Liability Law.

The general framework addresses the elements of liability, the forms of compensation and the circumstances in which responsibility may be attributed to individuals, employers, organisations or other legally recognised parties.

Tort liability is distinct from contractual liability, although the same facts may sometimes give rise to both.

For example, defective goods may breach a sales contract and also cause personal injury or property damage, creating potential contractual and tort claims.

14.2 General principles of tort responsibility

The general tort framework ordinarily requires examination of the conduct, the legally protected interest affected, the damage and the relevant basis of responsibility.

Fault is a central basis of liability, but the Code also recognises forms of liability based on statutory risk allocation or other special rules.

The distinction matters because a claimant cannot assume that every case requires proof of negligence in precisely the same way. Product liability, highly dangerous activities and other special categories may be governed by different standards.

14.3 Forms of civil liability

The Code recognises a range of civil remedies and forms of responsibility.

These may include:

• Cessation of infringement.
• Removal of obstacles.
• Elimination of danger.
• Return of property.
• Restoration to the original condition.
• Repair, reworking or replacement.
• Compensation for losses.
• Payment of agreed or legally prescribed damages.
• Elimination of adverse effects and restoration of reputation.
• Apology.

The appropriate remedy depends on the nature of the infringement and the legal conditions governing the claim.

14.4 Product liability

The Code contains specific rules concerning damage caused by defective products.

Manufacturers and sellers may incur liability where products fail to satisfy the applicable safety requirements and cause legally recognised injury or damage.

The rules address the allocation of responsibility between manufacturers and sellers, as well as the rights of injured persons.

These provisions are particularly important for manufacturing, distribution, importation and consumer markets. They operate alongside product quality legislation and other regulatory requirements.

14.5 Motor vehicle accidents

The Code regulates civil liability arising from motor vehicle traffic accidents.

Responsibility may depend on fault, statutory allocation rules, insurance arrangements and the circumstances of the accident.

Compensation may cover legally recognised categories of personal injury and property damage. The relevant provisions operate alongside road traffic legislation and compulsory insurance requirements.

14.6 Medical damage liability

The Code contains provisions addressing medical damage and the responsibilities of medical institutions and professionals.

These provisions concern matters such as compliance with medical standards, informed consent, documentation and responsibility for injury arising from medical treatment.

Medical liability is particularly fact-sensitive. The applicable legal analysis may require medical evidence, expert assessment and examination of the relevant statutory and professional standards.

14.7 Environmental pollution and ecological damage

Environmental liability is a notable part of the Code.

The Tort Liability Book recognises responsibility for pollution and ecological destruction. It provides mechanisms for compensation and restoration, subject to the statutory conditions.

The framework may also address the cost of preventing further damage, restoring the affected environment and other legally recognised consequences.

These provisions are important for industrial enterprises, infrastructure projects, waste management, resource extraction and other activities with environmental effects.

14.8 Liability for highly dangerous activities

Certain activities create risks that justify special rules of responsibility.

The Code regulates liability arising from highly dangerous operations and other activities identified by law. The applicable standard may differ from ordinary fault-based liability.

This approach reflects the principle that those who conduct particularly hazardous activities may bear responsibility for specified consequences even where ordinary negligence is not the sole basis of the claim.

14.9 Liability for harm caused by animals and objects

The Code also regulates responsibility for harm caused by animals, buildings, structures, objects and other sources of risk.

The person responsible may depend on ownership, management, control, maintenance obligations and the specific statutory rule.

These provisions are relevant to property owners, occupiers, employers, operators and persons responsible for animals or dangerous objects.

15. Civil Obligations and the Performance of Duties

15.1 Sources of civil obligations

Civil obligations may arise from several legal sources.

The most familiar is a contract, under which one party becomes entitled to demand performance from another. However, obligations may also arise from other legally recognised circumstances.

The Civil Code identifies obligations arising from contracts, torts, management of another’s affairs without mandate, unjust enrichment and other legal grounds.

This is important because not every civil claim depends on the existence of an agreement.

A person who unlawfully damages another’s property may owe compensation even though the parties never entered into a contract. Similarly, a person who receives a benefit without a legal basis may be required to return it under the rules on unjust enrichment.

15.2 Performance of obligations

Civil obligations must be performed in accordance with their legal source and applicable terms.

Where a contract exists, performance is generally governed by its provisions, subject to mandatory legislation and the Code’s general principles.

The relevant matters may include:

• The identity of the person required to perform.
• The identity of the creditor.
• The subject matter of the obligation.
• The time and place of performance.
• The required quality and method of performance.
• The allocation of expenses and risks.
• The consequences of delay or non-performance.

A party should not assume that an obligation has been discharged merely because it has taken some steps towards performance. The legal question is whether the required performance has been completed or whether another legally recognised event has discharged the obligation.

15.3 Assignment and transfer of obligations

The Civil Code regulates the assignment of creditor’s rights and the transfer of debts, subject to statutory conditions.

A creditor may generally assign a claim unless the law, the nature of the obligation or an applicable contractual restriction prevents it.

The transfer of a debt ordinarily requires the creditor’s consent under the relevant statutory framework.

The Code also addresses the transfer of contractual rights and obligations as a whole, which may require the consent of the other party.

These provisions are important in commercial financing, factoring, corporate restructuring and the sale of business assets.

15.4 Set-off

The Code recognises set-off as a mechanism through which reciprocal obligations may be extinguished to the extent permitted by law.

Where two parties owe each other obligations of the relevant kind, one party may be entitled to offset its claim against the other party’s claim, subject to the statutory requirements and any applicable restrictions.

Set-off can be particularly important in commercial relationships involving repeated transactions, reciprocal debts or ongoing supply arrangements.

15.5 Termination and discharge of obligations

Civil obligations may be discharged through performance, set-off, deposit in circumstances recognised by law, release, merger of creditor and debtor positions, or other legally prescribed grounds.

Contracts may also terminate in accordance with their terms or the statutory rules.

Termination does not necessarily eliminate every obligation arising from the relationship. Duties concerning confidentiality, return of property, settlement of accounts, compensation or other matters may survive where the law or contract so provides.

16. Civil Liability and Remedies

16.1 The distinction between civil liability and criminal punishment

Civil liability is concerned principally with protecting private rights and allocating responsibility for infringements or non-performance.

Criminal liability, by contrast, concerns conduct defined as criminal under the Criminal Law and may result in state-imposed punishment.

The same conduct can sometimes create both forms of liability. For example, serious fraud may generate civil claims for repayment or compensation while also giving rise to criminal proceedings.

An administrative violation may also coexist with civil liability. The relevant legal basis and procedures must be examined separately.

16.2 Compensation for loss

Compensation is one of the principal remedies under the Civil Code.

In contractual disputes, the amount of compensation generally relates to the loss caused by the breach, subject to the statutory rules concerning causation, foreseeability and other limitations.

In tort cases, compensation depends on the nature of the harm and the applicable provisions.

The Code contains specific approaches for personal injury, property damage and other forms of legally recognised loss.

16.3 Non-monetary remedies

Not all civil wrongs can be adequately remedied through money.

The Code therefore recognises remedies such as cessation of infringement, removal of obstacles, return of property, restoration, repair and apology.

These remedies are especially relevant to property disputes and personality-rights claims.

For example, a person whose likeness is unlawfully used in advertising may seek cessation of the unauthorised use as well as compensation where the statutory requirements are met.

16.4 Joint and several liability

The Code recognises circumstances in which more than one person may be responsible for the same civil harm.

Depending on the legal basis, responsibility may be joint and several or allocated according to the contribution of each party.

This can arise in cases involving joint tortfeasors, employers, service providers, product distribution chains or other legally recognised relationships.

The applicable statutory provision determines whether a claimant may seek full performance from one responsible party or must pursue each party according to its allocated share.

16.5 Mitigation and contribution

Civil liability is affected by the conduct of the parties and the circumstances surrounding the harm.

The Code recognises rules concerning the contribution of the injured party, the conduct of multiple responsible persons and other factors relevant to the allocation of liability.

The claimant’s own conduct may therefore be relevant to the amount of compensation, where the statutory conditions are satisfied.

The law also expects parties to act consistently with good faith and to avoid unnecessarily increasing losses where the applicable rules impose such responsibilities.

17. Limitation Periods and the Enforcement of Civil Claims

17.1 The general limitation period

The Civil Code generally establishes a three-year limitation period for civil claims, unless another law provides otherwise.

The limitation period ordinarily begins when the claimant knows or should know that their rights have been infringed and who is responsible, subject to the statutory provisions.

This rule is important because the existence of a substantive right does not necessarily mean that a claim may be pursued indefinitely.

17.2 Suspension and interruption

The Code recognises circumstances in which the limitation period may be suspended or interrupted.

Suspension may occur where a legally recognised obstacle prevents the claimant from exercising the right to bring proceedings during the final part of the limitation period.

Interruption may arise from circumstances such as the claimant demanding performance, the debtor agreeing to perform, or the claimant initiating proceedings or arbitration, subject to the statutory requirements.

These rules affect the calculation of time and can be decisive in a dispute.

17.3 The longer outer period

The Code also establishes a general outer period of 20 years from the date on which the rights were infringed, subject to the possibility of an extension by a people’s court in special circumstances under the law.

This outer period should not be confused with the ordinary three-year limitation period. The two rules perform different functions.

17.4 Enforcement of judgments

Obtaining a civil judgment does not necessarily guarantee voluntary compliance.

Where a party fails to perform a judgment or other enforceable legal instrument, the successful party may seek enforcement through the competent people’s court.

Enforcement may involve legally authorised measures against property, accounts or other assets, subject to procedural requirements and statutory protections.

For foreign companies, it is important to consider enforceability when negotiating dispute-resolution clauses and assessing the assets of a potential counterparty.

18. The Civil Code and Foreign-Related Civil Relationships

18.1 The territorial application of Chinese civil law

The Civil Code forms the principal substantive framework for civil relationships in mainland China. Its rules may apply to transactions and relationships involving foreign individuals or companies, subject to the conflict-of-laws provisions and any applicable international arrangements.

A foreign party should not assume that its nationality or overseas place of incorporation automatically excludes the application of Chinese civil law.

For example, a contract performed in China, a property interest located in China or a civil wrong occurring in China may raise questions involving Chinese substantive law. The final determination depends on the applicable conflict-of-laws rules and the character of the relationship.

18.2 The Law on the Application of Laws to Foreign-Related Civil Relations

The Civil Code does not contain a complete conflict-of-laws system. The principal statutory instrument governing the selection of applicable law in foreign-related civil relationships is the Law of the People’s Republic of China on the Application of Laws to Foreign-Related Civil Relations, adopted in 2010.

This legislation addresses matters such as:

• Personal status and capacity.
• Marriage and family relationships.
• Succession.
• Property rights.
• Contracts.
• Tort liability.
• Intellectual property.
• Other foreign-related civil relationships.

It establishes connecting factors and rules for determining which country’s law applies to a particular issue.

Depending on the subject matter, relevant connecting factors may include habitual residence, nationality, the location of property, the place of performance or the parties’ choice of law.

18.3 Party autonomy in contractual relationships

The conflict-of-laws framework recognises party autonomy in certain foreign-related contractual relationships.

Parties may, within the statutory limits, choose the law governing their contract. The choice must satisfy the relevant requirements and cannot override mandatory rules that apply irrespective of the parties’ preference.

This is particularly important in international commercial transactions. A foreign company and a Chinese company may select a foreign governing law for an eligible contract, but the choice does not automatically remove every connection with Chinese law.

For example, Chinese mandatory regulatory rules may still apply to activities conducted in China. The choice of governing law also does not necessarily determine the jurisdiction of the court or arbitral tribunal, which is a separate question.

18.4 Foreign-related property rights

Property rights are generally closely connected with the location and legal status of the property.

For immovable property, the law of the place where the property is situated is particularly important under the conflict-of-laws framework.

This means that a foreign national acquiring an interest in real estate in mainland China cannot simply assume that the property will be governed by the law of their nationality or habitual residence.

The Civil Code’s property provisions, land legislation, registration rules and applicable foreign-related legal provisions must be considered together.

18.5 Foreign-related tort claims

Where a civil wrong involves foreign elements, the applicable law must be determined under the relevant conflict-of-laws provisions.

The location of the harmful act, the place where damage occurs and other statutory connecting factors may be relevant. The parties may also have certain choices in the circumstances recognised by law.

The Civil Code provides the substantive rules concerning tort liability, while the foreign-related legislation determines which country’s substantive law governs the particular dispute.

18.6 Recognition of foreign judgments and arbitration awards

A foreign civil judgment is not automatically enforceable in mainland China merely because it is valid in the country where it was issued.

Recognition and enforcement depend on the relevant Chinese procedural legislation, applicable international treaties and, where relevant, reciprocity.

International arbitration awards are subject to a separate legal framework. China is a party to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, subject to its declarations and the Convention’s scope.

A foreign company should therefore distinguish between the substantive law governing a contract, the forum deciding a dispute and the legal mechanisms for recognition and enforcement of the resulting judgment or award.

19. The Civil Code in Practice for Foreign Individuals and Businesses

19.1 Contracting with Chinese companies

The Civil Code is central to contracts between foreign parties and Chinese businesses where Chinese civil law applies.

Foreign companies should pay attention to the identity of the contracting entity, the authority of the person signing, the description of the goods or services, payment arrangements, delivery, quality standards, remedies and dispute-resolution provisions.

The governing-law clause should be considered together with the choice of court or arbitration and the practical location of assets that may be needed to satisfy a judgment or award.

A contract’s language is also important. Where the parties sign Chinese and English versions, they should specify whether one version prevails in case of inconsistency.

19.2 Leasing and acquiring property

Foreign individuals and companies may enter into property-related transactions in China, subject to the applicable ownership, land-use, registration and foreign-related restrictions.

The Civil Code regulates leases, property rights and related obligations. Other legislation determines the conditions under which foreign persons may acquire or use particular categories of property.

A lease should identify the premises, duration, rent, deposit, maintenance obligations, permitted use, termination conditions and responsibility for relevant expenses.

A purchaser or investor should also examine the seller’s title, the relevant land-use rights, registration status, any mortgages or other encumbrances and the permitted use of the property.

19.3 Personal information and commercial relationships

Foreign businesses that collect information about customers, employees, suppliers or business contacts in China may encounter obligations under both the Civil Code and the Personal Information Protection Law.

The Civil Code provides the general civil-law protection of personality and personal information. The specialised data protection framework establishes detailed requirements for processing and transferring information.

A company should therefore consider privacy and data protection when drafting employment contracts, customer terms, marketing permissions, supplier agreements and technology contracts.

19.4 Family and inheritance matters

Foreign individuals with family, property or inheritance connections in China may encounter the Civil Code’s provisions on marriage, divorce, parental responsibilities, adoption and succession.

The applicable law may depend on the nature of the relationship and the relevant conflict-of-laws rules.

A marriage celebrated abroad, for example, may raise different questions from a marriage registered in China. Similarly, an estate involving property in China and heirs living overseas may require separate examination of the law applicable to different assets and relationships.

19.5 Civil litigation and legal representation

Civil disputes under the Code are generally resolved through the people’s court system, arbitration where legally available, mediation or other recognised procedures.

Foreign parties involved in Chinese civil proceedings must observe procedural requirements concerning jurisdiction, documents, evidence, translations, representation and deadlines.

The substantive rights contained in the Civil Code do not remove the need to comply with the Civil Procedure Law and other procedural legislation.

Foreign individuals and companies should also consider whether the dispute is suitable for arbitration, whether a valid arbitration agreement exists and whether the resulting decision will be enforceable where the relevant assets are located.

20. The Civil Code and the Wider Chinese Legal System

The Civil Code occupies a central position in Chinese private law, but it does not operate in isolation.

It is complemented by legislation regulating particular legal subjects and commercial activities. The relationship between general and special legislation is important when determining the applicable rule.

For example:

Legal subject	Principal framework alongside the Civil Code
Companies	Company Law
Employment	Labour Contract Law and related legislation
Foreign investment	Foreign Investment Law
Personal information	Personal Information Protection Law
Cybersecurity and data	Cybersecurity Law and Data Security Law
Patents and trademarks	Patent Law and Trademark Law
Copyright	Copyright Law
Consumer transactions	Consumer Rights and Interests Protection Law
Product safety	Product Quality Law and specialised rules
Civil procedure	Civil Procedure Law
Foreign-related law	Law on the Application of Laws to Foreign-Related Civil Relations

The Civil Code provides general civil principles, but special legislation may establish more detailed or different rules for a particular subject. Its own general provisions recognise that where other laws contain special provisions governing civil relationships, those special provisions prevail.

This is a conventional feature of codified legal systems: a general code supplies the common framework, while specialised statutes regulate particular sectors and activities.

20.1 Judicial interpretations and the application of the Code

The Supreme People’s Court plays an important role in explaining how the Civil Code is to be applied by people’s courts.

Judicial interpretations address recurring questions concerning statutory meaning, evidence, contractual obligations, liability and procedural application.

One important example is the 2022 interpretation concerning the general provisions of the Civil Code. It clarifies a number of issues relating to civil rights, capacity, guardianship and other matters.

Another significant instrument is the Supreme People’s Court’s 2023 interpretation concerning the general provisions of the Contract Book. It addresses matters including contract formation, interpretation, validity, performance and liability.

These interpretations are important for understanding the practical application of the Code. They should be read together with the statutory provisions and any later amendments or subsequent judicial interpretations.

20.2 The role of people’s courts

People’s courts adjudicate civil disputes under the Civil Code and the relevant procedural legislation.

Their work involves identifying the applicable legal provisions, determining the facts, evaluating evidence, interpreting contractual terms and deciding the remedies available to the parties.

The courts may also apply judicial interpretations and relevant guiding cases within the framework established by law.

For foreign parties, understanding the distinction between substantive civil rights and procedural rules is essential. A person may possess a valid contractual claim, for example, but still need to establish jurisdiction, comply with filing deadlines and present admissible evidence.

20.3 Mediation and alternative dispute resolution

Civil disputes may be resolved through mediation and other forms of alternative dispute resolution.

Mediation is particularly relevant in family, neighbourhood, commercial and contractual disputes. The legal system recognises mediation as a method of resolving civil disagreements, subject to the applicable rules.

Arbitration is also important in commercial relationships where the parties have entered into a valid arbitration agreement and the dispute falls within the scope of arbitration.

The choice between litigation, mediation and arbitration should take account of the nature of the dispute, the parties’ agreement, the location of assets, confidentiality considerations and enforceability.

21. Key Takeaways

1. The Civil Code of the People’s Republic of China was adopted on 28 May 2020 and entered into force on 1 January 2021.

2. It contains 1,260 articles organised into seven books: General Provisions, Real Rights, Contracts, Personality Rights, Marriage and Family, Succession, and Tort Liability.

3. The Code consolidated several major civil statutes, including the former Contract Law, Property Law and Tort Liability Law.

4. It regulates personal and property relationships between civil subjects of equal status.

5. Its fundamental principles include equality, voluntariness, fairness, good faith, legality, public order, good morals and environmental protection.

6. Natural persons have capacity for civil rights from birth until death, while their capacity for civil conduct depends on age and other legally relevant circumstances.

7. Adults generally have full capacity for civil conduct, while minors are subject to rules reflecting their age and maturity.

8. Guardianship provides legal protection and representation for persons who cannot independently exercise their civil rights to the extent recognised by law.

9. Legal persons possess a civil identity separate from their founders, shareholders or members.

10. The Code distinguishes for-profit, non-profit and special legal persons, as well as non-legal-person organisations.

11. Civil juristic acts may establish, modify or terminate civil legal relationships and include contracts and other legally recognised declarations of intention.

12. Agency permits a person to act on behalf of another within the scope of the authority granted or recognised by law.

13. The Code protects property rights, creditor’s rights, intellectual property interests and personality rights.

14. Land ownership in mainland China is subject to a distinctive framework involving state and collective ownership, with individuals and businesses acquiring legally recognised use rights and other interests.

15. The Contract Book governs formation, validity, interpretation, performance, modification, termination and breach of contracts.

16. The separate book on Personality Rights protects life, bodily integrity, health, name, likeness, reputation, honour, privacy and other personal interests.

17. Marriage and family provisions regulate marriage, marital property, parental responsibilities, divorce and adoption.

18. The Succession Book regulates statutory inheritance, wills, legacies and estate administration.

19. The Tort Liability Book establishes civil responsibility for infringement of rights and addresses product liability, traffic accidents, medical harm and environmental damage.

20. Civil obligations may arise from contracts, torts, unjust enrichment, management of another’s affairs without mandate and other legally recognised sources.

21. The general limitation period for civil claims is three years, subject to statutory exceptions, suspension and interruption rules.

22. The Civil Code operates alongside special legislation, including the Company Law, Labour Contract Law, Foreign Investment Law and Personal Information Protection Law.

23. Foreign-related civil relationships require consideration of the Law on the Application of Laws to Foreign-Related Civil Relations.

24. The choice of foreign governing law in an eligible contract does not automatically displace mandatory Chinese laws and regulations.

25. Judicial interpretations issued by the Supreme People’s Court are important for understanding how the Code is applied by people’s courts.

26. Foreign individuals and businesses may rely on the Code’s protections where applicable, but must also comply with the relevant Chinese substantive and procedural laws.

22. Frequently Asked Questions (FAQs)

1. What is the Chinese Civil Code?

The Chinese Civil Code is the principal comprehensive statute governing private-law relationships in mainland China. It regulates natural persons, legal persons, civil rights, property, contracts, personality rights, family relationships, inheritance and tort liability.

2. When did the Civil Code enter into force?

It was adopted by the National People’s Congress on 28 May 2020 and entered into force on 1 January 2021.

3. How many books does the Civil Code contain?

It contains seven books: General Provisions, Real Rights, Contracts, Personality Rights, Marriage and Family, Succession, and Tort Liability.

4. How many articles does the Civil Code contain?

The Code contains 1,260 articles.

5. Did the Civil Code replace earlier Chinese civil legislation?

Yes. It replaced and consolidated several important statutes, including the General Principles of Civil Law, Contract Law, Property Law, Tort Liability Law, Marriage Law and Inheritance Law, among others.

6. Does the Civil Code apply to foreign nationals in China?

Its provisions may apply to civil relationships involving foreign nationals where Chinese law governs the relevant issue. The applicable law must be determined in conjunction with the rules governing foreign-related civil relations.

7. Are foreign companies protected by the Civil Code?

Foreign companies may benefit from the Code’s provisions on contracts, property, civil obligations and liability where the relevant Chinese law applies. Their rights and obligations may also be affected by the Foreign Investment Law and specialised commercial legislation.

8. What is the difference between a natural person and a legal person?

A natural person is an individual human being. A legal person is an organisation recognised by law as having an independent civil identity, capable of holding rights, assuming obligations, owning property and participating in legal proceedings.

9. At what age does a person become an adult under the Civil Code?

A person generally becomes an adult at 18. The Code also recognises a special rule under which a minor aged 16 or above who relies mainly on their own labour income for subsistence is treated as having full capacity for civil conduct.

10. Can a minor enter into a contract in China?

A minor’s ability to enter into a legally effective contract depends on their age, capacity and the nature of the transaction. Children below eight generally lack capacity for civil conduct. Minors aged eight or above but below 18 generally have limited capacity, subject to statutory exceptions.

11. What is the difference between ownership and a land-use right in China?

Ownership concerns the legal title to property, while a land-use right provides a legally recognised right to use land owned by the state or a collective. The distinction is especially important in real estate transactions because private ownership of the underlying land is generally not available in the same way as in many other countries.

12. Does the Civil Code regulate contracts?

Yes. Book III regulates contractual relationships, including formation, validity, performance, interpretation, breach, termination and remedies.

13. Can parties choose foreign law for a contract involving a Chinese company?

In certain foreign-related contractual relationships, parties may choose the governing law under the applicable conflict-of-laws rules. However, mandatory Chinese provisions may still apply, particularly to regulated activities and transactions with a substantial connection to China.

14. What happens when a contract is breached?

Depending on the circumstances, the non-breaching party may seek continued performance, repair, replacement, compensation, liquidated damages or another remedy recognised by law and the agreement.

15. Does Chinese law recognise privacy rights?

Yes. The Civil Code contains a separate book on Personality Rights and recognises privacy as a protected right. The Personal Information Protection Law provides additional rules concerning the processing of personal information.

16. Does the Civil Code protect a person’s image and reputation?

Yes. It recognises rights concerning a person’s name, likeness, reputation and honour. Unlawful infringement may result in civil remedies, including cessation of the infringement, restoration of reputation and compensation where appropriate.

17. What is tort liability under the Civil Code?

Tort liability is civil responsibility for conduct that infringes another person’s rights or legally protected interests. The Code addresses general liability principles and specific areas such as product defects, traffic accidents, medical damage and environmental harm.

18. What is the limitation period for civil claims in China?

The general limitation period is three years, subject to statutory exceptions and rules concerning suspension, interruption and other relevant circumstances. Some claims are governed by special limitation rules.

19. Does the Civil Code regulate inheritance?

Yes. Book VI governs statutory inheritance, testamentary succession, wills, legacies and the administration of estates.

20. Can foreign nationals inherit property in China?

Foreign nationals may have inheritance rights in relation to property in China, subject to the applicable substantive and conflict-of-laws rules. The law governing the particular property and succession issue must be determined separately.

21. Does the Civil Code regulate marriage and divorce?

Yes. Book V addresses marriage, marital property, family relationships, divorce, parental responsibilities and adoption.

22. Does the Civil Code apply to employment contracts?

The Code provides general civil-law principles, but employment relationships are principally governed by the Labour Law, Labour Contract Law and related legislation. The applicable special rules must be considered.

23. Does the Civil Code protect intellectual property?

The Code recognises intellectual property rights as legally protected civil interests. Detailed protection is provided principally by specialised statutes, including the Patent Law, Trademark Law and Copyright Law.

24. Can a foreign company sue a Chinese company under the Civil Code?

A foreign company may bring civil proceedings where it has a legally recognised claim and the Chinese courts have jurisdiction under the applicable procedural rules. The relevant substantive law, evidence requirements, representation rules and enforcement arrangements must also be considered.

25. Is the Chinese Civil Code similar to European civil codes?

It shares structural and conceptual features with continental civil-law traditions, including a general part and specialised books dealing with property, contracts and other private-law relationships. However, it reflects China’s own legal history, socialist constitutional framework and institutional arrangements. It should not be treated as identical to the German, French or other European Civil Codes.

23. Authoritative Legal Sources and Further Reading

The following sources provide the principal statutory and institutional materials for further study. The English translations are useful for international readers, although the authoritative legal text is the Chinese version.

A. Primary legislation and the Civil Code

1. Civil Code of the People’s Republic of China — State Council, official English-language publication.
Read the Chinese Civil Code.

2. Civil Code of the People’s Republic of China — full English translation — NPC Observer. This translation reproduces the seven books and the 1,260 articles.
Consult the full English translation.

3. Civil Code of the People’s Republic of China — Chinese statutory text — Cyberspace Administration of China, official publication.
Read the Chinese statutory text.

4. National People’s Congress: Adoption of the Civil Code, 28 May 2020 — official announcement explaining the legislative project and the Code’s structure.
Read the adoption announcement.

5. Library of Congress: China — National People’s Congress Adopts New Civil Code — institutional analysis of the codification process and legislative background.
Read the Library of Congress analysis.

B. Judicial interpretations and application

6. Supreme People’s Court: Interpretation on General Provisions of the Civil Code — institutional announcement concerning the 2022 judicial interpretation.
Read the judicial interpretation announcement.

7. Supreme People’s Court: Contract Interpretation under the Civil Code — announcement concerning the judicial interpretation that entered into force on 5 December 2023.
Read the announcement on contract interpretation.

8. Supreme People’s Court: Interpretation of the General Provisions of the Contract Book — official Chinese statutory text.
Consult the official interpretation.

C. Foreign-related civil law

9. Law on the Application of Laws to Foreign-Related Civil Relations — relevant legislation governing the selection of applicable law in cross-border civil relationships.
National People’s Congress legislative portal.

10. International Labour Organization — NATLEX: Civil Code of the People’s Republic of China — legislative record and statutory information.
Consult the NATLEX record.

D. Historical and comparative materials

11. General Principles of Civil Law of the People’s Republic of China (1986) — historical statutory text, useful for understanding the development of modern Chinese civil law.
Read the 1986 General Principles.

12. General Provisions of the Civil Law (2017) — the legislative foundation for Book I of the current Civil Code.
Read the 2017 General Provisions.

13. China Law Translate — Civil Code of the People’s Republic of China — searchable English translation and explanatory legislative material.
Consult the English-language legal resource.

Conclusion

The Civil Code of the People’s Republic of China is one of the most important legislative achievements in the development of the modern Chinese legal system. By consolidating the principal areas of private law into a comprehensive statutory framework, it establishes a common foundation for civil relationships involving individuals, companies, organisations and other legally recognised entities.

Its importance extends far beyond contractual transactions. The Code regulates property ownership and use, personal dignity, privacy, family relationships, inheritance, civil obligations and responsibility for harm. It also provides general legal concepts that influence the application of specialised legislation throughout the Chinese legal system.

For foreign individuals and businesses, the Civil Code is indispensable to understanding the legal consequences of everyday and commercial activity in mainland China. It provides the substantive rules governing many transactions and disputes, while foreign-related legislation determines which country’s law applies when relationships cross national borders.

The Code should therefore be approached not as an isolated statute, but as the central component of a wider legal framework that includes company legislation, labour law, intellectual property protection, foreign investment regulation, data protection and civil procedure.

Its adoption marked an important stage in the consolidation of Chinese private law. Its continuing interpretation and application will remain central to the development of commercial relationships, personal rights and civil justice in mainland China.

Editorial note: This article concerns mainland China. Hong Kong and Macao operate under distinct legal arrangements pursuant to their respective Basic Laws. This material is intended for legal education and general research and does not constitute individual legal advice.

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