July 19, 2020

China adopts comprehensive Civil Code

The long-expected comprehensive Civil Code in China has been finally passed on May 28, 2020 by the 13th National People’s Congress (PRC -People’s Republic of China’s highest legislature) taking take effect on 1st January 2021. It is the PRC most extensive, modern laws compilation, the only one known as a “code”.

The process has taken about 60 years starting back in 1954, but after several unsuccessful attempts, even in spite the ‘reform and opening-up policy’ of December 1978, the complexity and controversy, finally in October 2014, the Communist Party of China, as part of the necessary progress to achieve the country’s rule of law, resolved to compile a unified civil code by 2020.

It is comprised by 1,250 articles covering almost every part of civil society, widely acclaimed as a milestone in China’s legal system. It codifies the fundamental rules of law on civil and commercial matters and reinforces protection of citizens’ personal rights such as those of privacy and personal information.

Foreigner, especially investors, needless to say, must realize this change and the new legal framework in their foreign transactions and investments, as it will abolish and replace important laws and General Provision, e.g. : Guarantee Law, Contract Law, Property Law and Tort Liability Law.

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