Dr Shengnan Jia[1]

China is a civil law jurisdiction which built its legal system with reference to the German legal system,[2]with further influence from Japan and the Soviet Union.Thus, China’s legal system is fundamentally different from that of the commonlaw system. This short article will give a brief overview of sources of law inChina. It is expcted that this piece would assist fellow lawyers in Europeancountries to understand which kind of ‘law’ constitutes the applicable law thatChinese courts and/or tribunals follow.

In accordance with Chinese law and legalpractice, sources of law can be categorised into four kinds – legislation,customary business practice, guiding case, and jurisprudence,[3]which will be briefly introduced in the following paragraphs.

1.       Legislation

In terms of legislation, it can be furtherlydivided into

  • laws (including general lawand special law);
  • regulations; and
  • judicial interpretations.

First, similar to other civil lawjurisdictions, laws can be divided into general law and special law. However,the boundary between them is not always clear. Put it in another way, theclassification of these two types of law varies in differet contexts. Forexample, as opposed to General Principles of the Civil Law of the People’sRepublic of China (hereinafter referred to as “General Rules of the CivilLaw”),[4]Contract Law of the People’s Republic of China (hereinafter referred to as“Contract Law”) can be regarded as the special law. However, in comparison withContract Law, the Chinese Maritime Code should be treated as the special law.

In the context of the application of laws, the general law is only applied when the revelantprovisons in special law is inadequate to be applied. For example, theChinese Maritime Code does not provide the legal nature and effect of theshipowner’s lien on sub-freights in charterparties. Under this circumstance, Property Law 2007 and/or Guarantee Law 1995 constitutethe applicable law.

Secondly,what ‘Regulations’ referred to will be discussed in this section. In accordancewith the legislation and legal practice, Regulations can be interpreted in abroad sense. As far as the legislative authorities are concerned, besides thatthe National People’s Congress and its Standing Committee can exercise nationallegislative power, which is to enact the general law and the special law,[5]Regulations, that includes Administrative Regulations, Local Provisions,Autonomous Regulations and Special Regulations, and Rules, can be enacted bythe State Council, the People’s Congress of a province, govermants ofautonomous regions and direct-administered municipalities. State Councildepartments, committees, the People’s Bank of China, auditing offices anddirectly controlled institutions with administrative regulatory functions, maydraft rules within the scope of that department’s authority on the basis oflaws, state council administrative regulations, decisions, or orders.[6]The above-mentioned administrative regulations, local decrees, autonomousdecrees and special decrees in a specific context can be treated as Regulationsto be cited in a judicial judgment.[7]

Whetherthese Regulations may constitute the applicable ‘law’ depends on whether thelaw in higher hierarchy provides express stipulations. Without expressstipulations or opposite stipulations under the law in higher hierarchy, theseRegulations may becomeapplicable. For instance, under Property Law, the object of a pledge may include account receivables,but the scope of account receivables is not clarified. It is, therefore, thecase that the People’s Bank of China enacts ‘Measures for the Registration ofPledge of Account Receivables (revised in 2017)’ to provide the meaning ofaccount receivables. The Supreme People’s Court (SPC) in Liaoning Wufeng Agricultural TechnologyCo.Ltd v Shengyang Branch of Industrial Bank Co.Ltd[8]affirmedthe meaning of account receivables issued by the People’s Bank of China. Itshould be noted that in legal practice conflicting Regulations do coexist, andit leads to complex situations.

Thirdly,what is the meaning of judicial interpretations and its legal effect? China isa civil law country dependent on statute law.[9]However, in practice, statute law cannot be amended in time to keep uptodatedwith the latest situation. Thus, the judicial interpretation of the SPC becomesa source of law. Although many scholars question the legality of such aninterpretation owing to the fact that the Legislation Law provides that thepower to interpret a national law shall be vested in the Standing Committee ofthe National People’s Congress, the main opinion is that the Standing Committeeof the National People’s Congress has the authority to interpret vague andambiguous provisions, whereas the SPC has the power to interpret theapplication of provisions in general. As a result, the judicial interpretationof the SPC is regarded to be valid all the time. Furthermore, the scope ofjudicial interpretations is very broad. Put it in another way, there is nouniform title or scope pertaining to judicial interpretations. For example, theNotice of the SPC, Chinese Maritime Courts Seminar for Presidents[10],Official Reply of the SPC can all be regarded as judicial interpretations,which may be the applicable law. Apart from the SPC, the High Court indifferent provinces or even the Intermediate Courts may issue judicialinterpretations which may be applied in their jurisdiction.

[1] Dr Shengnan Jia, Co-foundingDirector of CECCA; a partner at Tahota Law Firm; more information can be foundby https://cecca.org.uk/about-us. Because of the limited space, some detailsand cases cannot be touched. If you have any further questions, please feelfree to contact Shengnan.jia@cecca.com.cn

[2] Apart from the Germanic legalsystem, the modern Chinese law was affected by socialist law before 1980s sincethe establishment of the People’s Republic of China. Furthermore, the doctrinesof Confucianism play an important role in the Chinese legal system.

[3] In accordance with GeneralRules of the Civil Law of the People’s Republic of China (2017), Article 10 isprovided that “Any civil dispute shall be resolved in accordance with the law,in the absence of relevant provisions set forth in law, usual practice may befollowed, but the public order and good customs shall not be infringed upon.”“Usual practice” in the business domain refers to customary business practice;see also, Huixing Liang, Understandingand Application of Certain Important Articles Under General Rules of the CivilLaw, Journal of Sichuan University ( Philosophy and Social ScienceEdition), Vol. 4 2017.

[4] It should be noted that inChina there is no Uniform Civil Code. Since General Principles of the Civil Lawcame into force in 1986, in the past 30 years, this legislation played animportant role in dealing with civil and commercial cases. In October 2017,General Rules of the Civil Law came into force. In accordance with the theoryof the application of legislation, if the civil conduct happens before theGeneral Rules of the Civil Law comes into force, this civil conduct will besubject to the General Principles of the Civil Law unless there are no relevantprovisions under the General Principles.

[5]Article 7, Chinese LegislationLaw.

[6]Articles 65,72 and 80, Chinese Legislation Law.

[7] Article 4, Provisions of theSupreme People’s Court on Citation of Such Normative Legal Documents as Lawsand Regulations in the Judgments (effective 4 November 2009)

[8] [2017] No.5014 Retrial

[9] In this context, Statute lawrefers to laws and regulations discussed in the above two sections.

[10]ChineseMaritime Courts Seminar for Presidents 2001


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