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17 May 2021

Marking A Milestone: The Long-Awaited Chinese ‘Civil’ Code

It might have been overshadowed by Coronavirus coverage, but the coming into force on 1 January 2021 of the new Chinese Civil Code is of major importance in the world of comparative law. It is the most extensive legislation of its kind in the history of the People’s Republic of China (PRC).


Historically, China has had the long-cherished wish to follow the Civil Law idea of codification.


Admittedly, the first codified laws can be found in imperial China with the compilation of the Tang Code in the year 624 after Christ, followed by those of the Song or Ming dynasties or in the last dynasty by the Da Qing Lü Li.  However, these imperial Codes covered criminal and administration law, not civil law.


A Civil Law style Code for China

Emperor Guang Xu, during the late Qing dynasty, mandated a special hand-picked committee to draft a Western style ‘Civil’ Code for China.  This Code was not enacted, but it later formed the basis of the Republic’s first enacted Chinese Civil Code in 1930.  Whilst still in force in Taiwan, this code was repealed in the RPC in 1949. Twice during the Mao period, the PRC attempted to draft a new civil code.  The attempts failed.  Under Deng Xiaoping, the legislative process which started with the promulgation in 1986 of the General Principles of Civil Law (156 articles in 9 chapters), eventually led in 2020 to the enactment of the new Civil Code.


Unlike the Civil Codes of France and Germany, the Chinese Civil Code would not take shape all at once.  The Chinese Civil Code is a gradual process – it took place step-by-step in separate laws.  The Code aims to systematically integrate, in 1260 articles, all the existing legal norms in the field of civil matters.  The structure of the Code is divided into seven Books: General Provisions, Property, Contracts, Personality Rights, Family Law, Succession, and Torts. The further emphasises China’s Civil Law (German, Swiss and Japanese law) tradition.


The Chinese Civil code is essentially a re-grouping of existing mini codes, without innovation, remodelling or rethinking of the existing texts.


State and private interests to be treated equally

An important feature of the Code is its effort to legitimise private law. For the first time in the history of the PRC, State interests and private interests are treated equally.  China never underwent a large-scale privatisation.  The private sector has been growing in China at an exponential speed outside the State sector, despite the lack of legal and ideological certainty.


Today, private economy makes up more than half of the Chinese economy, and the commitment to protect private interests is critical to the growth of China. This commitment to equal protection of State and private interests is duly recognised by Article 207 of the Civil Code.


A focus on conduct and pedagogical aims

The new Chinese Civil Code includes some new and modern provisions, like Article 815’s “seat thieves” provision – i.e. people refusing to move whilst seated where they should not (e.g. a seat for handicapped people in the subway or in a seat in a long distance train).  This provision states that passengers must adhere to what is mentioned on their transport ticket: seat number, time, as well as train number.  If they take a seat for which they do not have a ticket, they must pay the difference in price between the two fares and may be refused service by railway personnel.


The new Civil Code also wants to reduce the reluctance that people generally feel in China about helping strangers, because of fear of legal repercussion if something goes wrong in the treatment process.  This is colloquially known as the ‘shaoguanxianshi’ – i.e. do not get involved if it is not your business or your network of guanxi, family and friends and business associates.   Reference was made to the infamous Peng Yu incident in 2006, where a bystander (of that name) helped an elderly woman who had fallen, only to have her accuse him of knocking her down.  The Nanjing judge held that “no one would in good conscience help someone unless they felt guilty” and awarded the old lady a large sum, which stirred huge coverage and public outcry.  The Samaritan index hit another low point in 2011, when a two-year-old girl was run over twice on a public road and various passersby saw what happened but callously ignored ‘little Yue Yue’ (which name translates as Little Joy) crying for help and bleeding to death for fear of facing another Nanjing judge.  A local newspaper warned not to blame the passersby as it was the Nanjing judge that killed little Yue Yue.  To counter this, Article 184 of the Chinese Civil Code explicitly states that “where voluntary carrying out emergency assistance causes harm to the person receiving assistance, the helper does not bear liability”. Moreover, this new statutory remedy, based on the Civil Law ‘negotiorum gestio’ concept, gives the helper the right to claim compensation for the damage sustained and the expense incurred during the intervention.


These two examples illustrate the pedagogical ambition of the Civil Code.


No Common Law concept of Trust

The Chinese Civil Code continues the continental Civil Law tradition that a person only has one ‘patrimony’ and does not therefore recognise a separation of the legal ownership of the trustee from the equitable ownership of the beneficiary — typical for the Common Law trust concept (“xin tuo”).   This concept is not incorporated in the Civil Code, but it is covered in one special act, the Trust Law of 2001 which is limited for specific bank and financial institution transactions.  However, Art. 1133, §4 of the Chinese Civil Code provides that “a natural person may establish a testamentary trust according to the law” and as such could, arguably, allow the “contractualisation” of the trust-like fiduciary contract.   This absence indicates that the Chinese Code continues to belong to the Germanic legal family and does not wish to “mix” with the Common Law.


Whilst perhaps not a legal masterpiece, nor a modern innovative instrument, the new Chinese Civil Code is certainly an important milestone in the development of Chinese private law.  It enhances certainty and clarity and kickstarts the time of interpretation.  The Chinese Supreme People’s Court is quite prepared to step in and step up in this welcoming process.


Em. Prof. Jacques H. Herbots

Chairman of Herbots Solicitors