2012 Review: Contract Law – new interpretation brings clarity

January 04, 2013 | BY

clpstaff &clp articles

An Interpretation from the Supreme People's Court brought clarity over purchase and sale agreements, while Apple's trademark dispute reinforced that contracts are not always upheld before Chinese courts


SPC Interpretation on commercial contracts

After twelve years of consultation and drafting, the Supreme People's Court finally released the Interpretation on Issues Relevant to the Application of the Law in Trials of Disputes over Sale and Purchase Contracts (关于审理买卖合同纠纷案件适用法律问题的解释) on May 10 2012, which became effective on July 1 2012.

The Interpretation affects foreign businesses that are involved in the sale and purchase of goods in China on a commercial scale.

Specifically, the Interpretation guides courts on whether there was intent to enter into an agreement when companies draft sale and purchase contracts and reservation contracts.

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