China is embarking on an ambitious effort to develop a new, unified civil code, scheduled for completion by 2020. During this year’s meeting of the National People’s Congress, NPC delegates ratified the General Provisions on the Civil Code (“General Provisions”), China’s first significant step toward establishing a unified legal code on civil affairs in decades. The eventual code—of which the General Provisions is the first piece—is expected to cover topics such as contracts, marriage, inheritance, property, and torts.

Like most countries around the world, China has a civil law legal system, which means that Chinese judges use statutory codes to determine proper rulings on legal matters, and past court decisions have no precedential value; this is in contrast to the common law tradition widely used in the English-speaking world, in which past judicial decisions (particularly from higher courts) may serve as binding precedents on courts deciding cases that raise similar issues. While China already has several laws on the books regarding civil affairs (e.g., marriage, contract, and property laws), it lacks a unified code to which courts and judges may look to for guidance in legal cases and disputes.

China has experimented with unified civil codes in the past. Before its fall in 1912, the Qing Dynasty drafted a civil code governing property, civil procedure, and commerce, and the subsequent Nationalist Government ultimately enacted it in some form. The Republic of China later developed a full civil code, drawing from the French, German, and Japanese civil law systems. The quest for a unified civil code in the modern-day People’s Republic dates back to the earliest days of its founding, but has been hampered over the years by internal turmoil and other priorities. In 1986, the NPC promulgated the General Principles of the Civil Law (“General Principles”), which outlined the basic principles and scope of the civil law in China with an eye toward a single, unified code, but that effort that bore little fruit in the ensuing three decades. However, it appears that, under the Xi administration’s push to establish “rule of law” across the country, this longstanding effort may be back on track.

Not only do the General Provisions lay the groundwork for China’s eventual, unified civil code, they are of immediate consequence as they are to go into effect in October 2017, long before the full code is complete. The General Provisions establish new rules on topics including individual privacy rights, minors’ rights, and virtual asset and intellectual property rights. For instance, the General Provisions:

  • Lower the age at which minors are recognized to have limited civil capacity, from 10 to 8 years old;
  • Increase the standard statute of limitations from two to three years in civil cases (unless otherwise specified);
  • Afford partial property-owning rights to fetuses in order to facilitate cases involving matters such as estate transfers and donations;
  • Expand on and guarantee individual rights, such as the right to privacy; and
  • Redefine businesses and nonprofit organizations more generally (i.e., nonprofits are now “entities that do not distribute profits” instead of “entities that do not make profit”).

Once they go into effect, the General Provisions will supersede existing civil laws where there is a conflict, but where no conflicts arise, current laws will remain in effect. Therefore, the General Provisions are neither an amendment nor a new version of existing laws. Rather, they are akin to a “software patch,” revamping sections of the existing laws without overturning any particular law wholesale.

Reviews have been mixed so far, with some legal commentators observing that the General Provisions do not go far enough on civil liberties, individual privacy, and property rights. Other observers, however, are hopeful that they will be the first step to greater and more ambitious civil and legal reforms in the future. In a new section added after discussion among NPC delegates, the General Provisions make it illegal to defame or challenge the narrative of Communist Party “heroes and martyrs,” raising a wide array of legal questions on how damage would be assessed, or which parties would have standing to sue on behalf of a martyr. How the clause will be implemented is yet to be seen, but this situation is not entirely without precedent or context. In 2016, the brother of the nationally recognized martyr Qiu Shaoyun brought a lawsuit against Sun Jie, an internet celebrity with a 9 million-strong following, for making light of Qiu’s death on social media. The court ordered Jie to pay a nominal 1 RMB fine and apologize consecutively for five days.

Observers will be watching to see whether further progress towards the development of a unified civil code will reduce significant “gray areas” under current Chinese law, bringing individuals and entities in China a greater measure of certainty in the legal consequences of their actions.

Zhijing Yu of Covington & Burling LLP contributed to the research and drafting of this article.

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Photo of Ashwin Kaja Ashwin Kaja

Ashwin Kaja is special counsel in the firm’s Beijing office and is a member of the firm’s International Trade, Public Policy, Data Privacy & Cybersecurity, and Anti-Corruption practice groups. He has advised multinational companies, governments, and other clients on a range of matters…

Ashwin Kaja is special counsel in the firm’s Beijing office and is a member of the firm’s International Trade, Public Policy, Data Privacy & Cybersecurity, and Anti-Corruption practice groups. He has advised multinational companies, governments, and other clients on a range of matters related to international trade, public policy and government affairs, data privacy, foreign investment, anti-corruption compliance and investigations, corporate law, real estate, and the globalization of higher education. He also serves as the China and India editor for Covington’s Mr. Kaja is also a certified information privacy professional (CIPP/US). Prior to joining the firm, Mr. Kaja was an associate at another major international law firm in Beijing.