University Business Law: Chinese Contract Law vs. English Contract Law

This essay provides a comparative analysis of Chinese and English contract law. It begins by introducing the fundamental concepts of contract law and highlights the influence of English law on various legal systems. The essay then delves into the differences between Chinese and English contract law, focusing on aspects such as the definition of a contract, the role of third-party rights, and the formation of contracts. It also examines the differences in acceptance, including the requirements for communication and the concept of an invitation to treat. The essay further explores the similarities between the two legal systems, particularly in terms of good faith, contract formation, and acceptance methods. The conclusion summarizes the key findings, emphasizing the unique aspects of Chinese contract law while acknowledging the presence of certain shared principles. The essay uses academic sources to support its arguments.

Running head: BUSINESS LAW
Compare and Contrast of Chinese Contract Law
with English Contract Law
Name of the student:
Name of the university:
Author note

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Table of Contents
Introduction:...............................................................................................................................2
Discussion:.................................................................................................................................2
Differences:............................................................................................................................2
Similarities:.............................................................................................................................3
Conclusion:................................................................................................................................4
Reference:..................................................................................................................................5

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Introduction:
Contract is a legal promise that has been given by a person and accepted by other
and through this an individual gets the opportunity to do an act or abstains from doing an act.
Every country has certain rules regarding the contract law and similarities could be observed
regarding the basic principle of the contract law. Most of the countries follow the English rule
of contract law. Countries like Singapore and Australia follow the common rule principle
regarding the contract law. However, countries as China has its own contract law, which is
quite divergent in nature compared to the English Law. In this essay, all the related
differences between the Chinese contract law and English contract law has been discussed.
Further, certain similarities have been observed in this case, which also have been disclosed
here in this essay.
Discussion:
Differences:
Differences can be observed in the general provision of the Peoples Republic
contract code of China. According to the English contract law, contract is a legal agreement
and it includes any kinds of agreement. Even agreement to marriage is also comes under the
purview of this contract. However, according to section 2 of the Chinese contract code,
agreement relating to marriage or adoption could not come under the contract law and there
are other laws applied in those cases. Under the English law, third party rights play an
important role; however, Chinese contract law denies the existence of third party in contract
(DiMatteo and Lei 2017). China has given much concentration over the social and
economical order under section 7 of the Code. Like the English law, contract in China also
supports the written and oral format of contract. However, it has been stated that in case of

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any administrative regulation, other forms of contract could also be effective. Certain changes
can be observed in case of formation of contract. According to English contract law, there are
two terms of contract such as express contract terms and implied terms (Jingen and DiMatteo
2016). According to Article 12 of Code of contract of China, there are eight terms of contract
of whom names of the parties, quantity, quality and liabilities for breach form part. Further
differences can be observed regarding the definition of acceptance. According to the English
contract law, when an offer has been made to the person, he could accept the offer by orally
and after that, both the parties will be bound by the terms of the contract. However, according
to section 21 of the Code of Contract, a person to whom offer has been made could accept the
offer by serving notice to the offer maker and after that contract will be binding on the
parties. Certain time has been prescribed under section 23 of the Code where it has been
mentioned that every offer should consist of certain time specified in it (Andrews 2015).
According to the Chinese Contract Act, acceptance of an offer will be regarded as valid when
the notice of acceptance reaches to the offer maker (Liu, Wang and Wilkinson 2016). This
rule is quite different in case of Australian contract law. Further, unlike the common rule of
contract, an invitation to treat has been regarded as an offer in the Chinese contract. However,
there are certain conditions imposed on this matter. According to the provisions of the
Australian contract law, an offer can be treated as acceptance as soon the person to whom the
offer has been made gives positive consent over it (McKendrick 2014). It is not necessary
that the notice of acceptance has received by the offer maker or not. Further, the language of
a Chinese contract should be written in Chinese language and in case of foreign contract, it
creates a huge dilemma. Further, the contract law of China does not follow the common rule
of law.

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Similarities:
Apart from all the differences, there are certain similarities can be observed
between the contractual terms and rules of Chinese and Australian contract law. According to
the Chinese law, the contractual parties should have certain good faith regarding the
commencement of the contract and after the terms of the contract has been accepted; it will
be binding on the parties. Every party to the contract is required to maintain the terms of the
contract. These requirements are quite similar to the Western pattern of contract and countries
like Australia and Singapore follow this principle. Further, the Chinese formation of contract
is quite similar to that of the Australian or Singaporean contract formation. The contents
stated in Article 9 (capacity of the parties) and Article 10 (written format of contract) are
bearing the same requirement as of the English common rule of contract (Chan 2015).
Certain forms of acceptance such as acceptance through telex or fax are the established
principle under the common rule of contract and positive support regarding those methods
have been mentioned under the Chinese contract law. The Chinese rule regarding the offer
and acceptance reflects certain interrelations with the Australian contract rule. According to
Article 13 of Chinese contract, after an offer has been accepted by the party, valid contract
will be formed. The rules for the revocation of the offer have maintained certain links to the
English rule of contract. According to Article 17 of the Chinese contract, an offer maker can
revoke or withdraw an offer before the other party has accepted the offer.
Conclusion:
Therefore, it can be stated that irrespective of all the difficulties and differences,
certain similarities can be observed in the Chinese contract. It is a fact that the rules and
provisions of the Chinese contract law do not follow the common rule and principle.

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However, considering the basic norms and formation of contract, it can be stated that there
are certain similarities observed in between the countries.

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Reference:
Andrews, N., 2015. Contract law. Cambridge University Press.
Chan, A. ed., 2015. Chinese workers in comparative perspective. Cornell University Press.
DiMatteo, L.A. and Lei, C. eds., 2017. Chinese Contract Law: Civil and Common Law
Perspectives. Cambridge University Press.
Jingen, W. and DiMatteo, L.A., 2016. Chinese Reception and Transplantation of Western
Contract Law. Berkeley J. Int'l L., 34, p.44.
Liu, T., Wang, Y. and Wilkinson, S., 2016. Identifying critical factors affecting the
effectiveness and efficiency of tendering processes in Public–Private Partnerships (PPPs): A
comparative analysis of Australia and China. International Journal of Project Management,
34(4), pp.701-716.
Loc.gov. (2018). Legal Research Guide: China | Law Library of Congress. [online] Available
at: https://www.loc.gov/law/help/legal-research-guide/china.php [Accessed 12 Jul. 2018].
McKendrick, E., 2014. Contract law: text, cases, and materials. Oxford University Press
(UK).
Wipo.int. (2018). [online] Available at:
http://www.wipo.int/edocs/lexdocs/laws/en/cn/cn137en.pdf [Accessed 14 Jul. 2018].