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VOLUME 6, NUMBER 2 (Spring 2014)
Issue masthead
Culpa in Contrahendo in Chinese Contract Law
By HAN Shiyuan
The principle of culpa in contrahendo has had a major influence on legal systems worldwide since it was developed by Rudolph von Jhering 153 years ago. In the People’s Republic of China, culpa in contrahendo was first introduced as a result of theory reception. The former Economic Contract Law (1981) and the General Principles of Civil Law (1986) have partially accepted the idea of culpa in contrahendo. Provisions of the PRC Contract Law (1999) bear resemblance to culpa in contrahendo (arts. 42 and 43), with numerous references to foreign civil law theories and provisions of the UNIDROIT Principles of International Commercial Contracts (PICC, arts.2.1.15 and 2.1.16) and the Principles of European Contract Law (PECL, arts.2:301 and 2:302). These provisions are interpreted as precontractual obligations and the liability for culpa in contrahendo. Article 58 of the Contract Law on the effects of a void contract also includes some effects of the liability for culpa in contrahendo. Hereafter, Chinese legislation (Part II), judicial interpretations and cases (Part III) and legal theories (Part IV) will be described and analyzed. [read more...] 
Article | 6 Tsinghua China L. Rev. 157 (2014)
China’s Criminal Detention as a Compulsory Measure under Exigencies: a Comparative Analysis
By YI Yanyou
A man who has no knowledge about other countries has no knowledge about his own. This is also the case in the field of law. It becomes evident that comparing other countries’ laws with Chinese law helps us to understand ourselves better. As Zweigert and Kotz put it: “Only when a lawyer knows about other country’s legal knowledge can he understand his home country’s laws correctly.” This is one of the values of comparative law research. However, there are also risks in comparing laws between countries. This is because different legal systems use different terms to describe the same things. For example, in many Western countries, the search of a person is called a “search” while in China the search of a person is sometimes called “examination of the person.” Although called differently, they function in the same manner. In addition, Chinese law requires the investigative organ to produce and show a paper (证明文件) when conducting an inquest of the crime scene. The paper is not called a “warrant” although it functions as the warrants used in Western countries. There are many other examples. When making a comparison between two legal systems, we must first make sure that we are comparing the same things. At the same time, when we cannot find the same thing based on its name, we should try to find it by examining its function. I call this methodology a comparison based on function. We shall make comparisons among things that function in the same way, notwithstanding what they are called. For things that have the same name but function differently, we must be careful to not to treat them the same. For things that have different names but function the same way, we shall compare them as the same kind of things without hesitation. This essay uses such a methodology to explore China’s criminal detention in the global context in comparison to other jurisdictions. Part I shows the nature of China’s criminal detention in a historical and comparative context. Part II discusses the issue of probable cause and targets for criminal detentions. Part III discusses the issue of warrant requirements. Part IV introduces time periods for China’s criminal detentions, and argues that time periods for criminal detentions function in the same way as the requirement of “bringing the detainee to a judge without unnecessary delay”. Part V discusses other procedural safeguards for criminal detentions. Part VI discusses exclusionary rules which function as a remedy for violations of procedural safeguards concerning criminal detentions. [read more...] 
Article | 6 Tsinghua China L. Rev. 171 (2014)
Seeking Truth from Fact: Rationale and Use of Offshore Jurisdictions in the PRC
By Kristian Wilson

In 2013, inflows of foreign direct investment (“FDI”) to the People’s Republic of China (“PRC”) amounted to US$127 billion, making the PRC the world’s second largest recipient of inward FDI after the United States. Slightly behind the PRC were the British Virgin Islands (“BVI”) which had received FDI inflows of US$92 billion, making the BVI fourth in the world. It is noteworthy that not only are the PRC and the BVI among the top four recipients of FDI, there is also a strong relationship between the two jurisdictions in terms of FDI flows. For instance, the BVI is frequently cited as one of the top three sources of FDI into the PRC (together with the Cayman Islands (“Cayman”) and Hong Kong). In 2010, the BVI was the second-largest investor in the PRC, providing US$10.4 billion (9.1%) of total inward FDI into the PRC.

The question then arises as to why a small island located in the Caribbean should be both a significant recipient of global FDI and a leading contributor of FDI into the PRC. This paper will look at the reasons behind this phenomenon, by examining the role of the BVI in structuring inward investment into the PRC and considering how the BVI is used to structure outward investment by PRC enterprises. This paper will also consider other offshore jurisdictions, as well as the role of Hong Kong and Macau (which are often considered to be quasi-offshore jurisdictions) in Chinese FDI. This article will focus on the use of offshore jurisdictions from a legal perspective and consider the interplay of offshore structures with PRC law. This paper is divided into seven parts. Part I provides an overall introduction. Part II examines key definitions and perspectives. Part III looks at the economic development of the PRC and the context in which the use of offshore structures has emerged. Part IV looks at how offshore structures are used to finance PRC enterprises. Part V looks at how offshore jurisdictions have been used by PRC enterprises to structure their outward investment. Part VI will look at the future role of offshore jurisdictions in the PRC. Lastly, Part VII will make some concluding remarks. [read more...] 

Article | 6 Tsinghua China L. Rev. 205 (2014)
Combating Corruption: the Hong Kong Experience
By HUI Wing-chi
Corruption is a universal phenomenon and no society is devoid of it. Although the world is not short of ideas on how to tackle corruption, the Hong Kong experience is frequently quoted as an epitome of success. Anti-corruption efforts have succeeded in Hong Kong because of the establishment of the Independent Commission Against Corruption (“ICAC”) in 1974. Over the past 40 years, the ICAC has devoted itself to anti-corruption work, turning a pervasively corrupted place to one of the most corruption-free places in the world, and successfully upheld Hong Kong’s core values of fairness and probity. ICAC’s success is attributed to indispensable factors which can be interestingly summed up in the acronym – ICAC, where I stands for independent status, C for comprehensive and long-term strategy, A for adequate resources, and C for community support. [read more...] 
Article | 6 Tsinghua China L. Rev. 239 (2014)
China Law Update
Laws and Regulations
  • Amendments to the Company Law of the People’s Republic of China

Judicial Interpretations
  • Provisions of the Supreme People’s Court on the Issuance of Judgments on the Internet by the People’s Courts

Cases

Notice of the Supreme People’s Court on Issuing the Fifth Group of Guiding Cases
  • Zhang Li v. Beijing Heli Huatong Automobile Service Co., Ltd. , a Sale and Purchase Contract Dispute
  • ZTE (Hangzhou) Co., Ltd. v. Wang Peng, a Labor Contract Dispute
  • Zhao Chunming et al. v. the Automobile Transport Co., Ltd. of Fushan District, Yantai Municipality, Wei Deping, et al. , a Motor Vehicle Traffic Accident Liability Dispute
  • Shenzhen Siruiman Fine Chemicals Co., Ltd. v. Shenzhen Kengzi Water Supply Co., Ltd. and Shenzhen Kangtailan Water Treatment Equipment Co., Ltd. , an Invention Patent Infringement Dispute
  • Inner Mongolia Qiushi Real Estate Development Co., Ltd. v. the Civil Air Defense Office of Hohhot Municipality , a Civil Defense Administrative Levy Case
  • Wei Yonggao et al. v. the People’s Government of Lai’an County , a Case about a Reply to Recover Land-Use Rights
Notice of the Supreme People’s Court on Issuing the Sixth Group of Guiding Cases
  • Sun Yinshan v. Oushang Supermarket Ltd. Nanjing, Jiangning Branch, on Sales Contracts
  • Rong Baoying v. Wang Yang and Yongcheng Property Insurance Co. Ltd. Jiangyin Branch, on Vehicle Accident Liability
  • Huatai Property Insurance Ltd. Beijing Branch v. Li Zhigui, Tian’an Property Insurance Co. Ltd Heibei Province Subsidiary Zhangjiakou Branch, on the Jurisdiction of an Insurer’s Subrogation Right
  • Li Jianxiong v. Guangdong Province Department of Transportation, on Governmental Information Publicity

Legal News

Highlights of the Work Report of the Supreme People’s Court of China
  • Promoting Openness of the Judiciary
  • Correcting Injustice According to Law
  • Intensifying Executive Power through Various Measures
  • Combating Corruption Crimes
  • Promoting Convenient Raising of Lawsuits

Highlights of Work Report of China’s Supreme People’s Procuratorate
  • Intensifying Punishment of Severe Criminal Offences
  • Combating Duty Crimes
  • Preventing Injustice
  • Constructing a Qualified Team for Law Enforcement

Highlights on the NPC Standing Committee’s Legislative Plan in 2014
  • Revisions
  • Formulation
  • Others


[Download Full China Law Update in PDF] 
China Law Update | 6 Tsinghua China L. Rev. 257 (2014)

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