Supreme People's Court, Guiding Opinions on Several Issues Concerning the Lawful and Proper Trial of Civil Cases Involving the Novel Coronavirus Pneumonia Epidemic (1)

(1)        Where the inability to perform the contract is directly due to the epidemic or the measures taken to prevent and control the epidemic, provisions on force majeure shall be applied in accordance with the law and liability shall be partially or fully exempted depending on the extent of the impact of the epidemic or the measures taken to prevent and control the epidemic. Where there are factors attributable to a party that made the contract unperformable or increased the losses, it shall bear the attendant liability in accordance with the law. If a party failed to perform its contractual obligations due to the epidemic or the measures taken to prevent and control the epidemic, and claims that it performed its notification obligation in a timely manner, it shall bear the attendant burden of proof in respect thereof.

(2)        Where the epidemic or the measures to prevent and control the epidemic only result in making performance of the contract difficult, the parties may hold new consultations. If continued performance is possible, the people's court shall duly enhance its mediation efforts and actively guide the parties in continuing performance. If a party requests termination of the contract on the grounds of difficulty in performing the same, the people's court shall reject such request.  If continued performance of the contract would be clearly unfair to one party and such party requests amendment of the deadline for performance of the contract, the method of performance, the price amount, etc., the people's court shall decide whether to uphold such request in light of the actual circumstances of the case. Where a party still requests partial or full exemption of liability after amendment of the contract in accordance with the law, the people's court shall reject such request.  If the objective of the contract cannot be achieved due to the epidemic or the measures taken to prevent and control the epidemic, and a party requests termination thereof, the people's court shall uphold such request.

(3)        Where a party has, due to the epidemic or the measures taken to prevent and control the epidemic, received a subsidy, assistance or tax relief from a government department, or assistance or debt relief from a third party, etc., the people's court may treat the same as a reference factor in establishing case facts such as whether the contract can continue to be performed (Article 3).

The adoption of flexible ways of working by employers in accordance with laws and regulations during the epidemic prevention and control period shall be supported. When handling trials of employment dispute cases involving the epidemic, Article 26 of the PRC Labor Law and Article 40 of the PRC Employment Contract Law shall be accurately applied. Where an employer requests termination of an employment relationship solely on the grounds that the worker has been diagnosed with COVID-19, seems to have contracted COVID-19, is an asymptomatic carrier, has been isolated in accordance with the law or is from a region where the epidemic is relatively serious, the people's court shall reject such request. When handling relevant employment dispute cases, the policy documents on duly handling employment relationships during the epidemic prevention and control period formulated by the relevant competent administrative departments of the State Council and provincial-level people's governments, etc. shall be correctly understood and applied mutatis mutandis (Article 4).

If a right of claim cannot be exercised during the last six months of the limitation of actions due to the epidemic or the measures taken to prevent and control the epidemic, and the rights holder requests that the limitation of actions be tolled pursuant to Item (1) of the first paragraph of Article 194 of the PRC General Provisions of the Civil Law, the people's court shall uphold such request (Article 6).