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Property law of the People's Republic of China

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Property law of the People's Republic of China

Order of the President of the People's Republic of China

No. 62

The property law of the People's Republic of China was adopted at the fifth session of the tenth National People's Congress of the People's Republic of China on March 16, 2007, which is hereby promulgated and shall come into force as of October 1, 2007.

President of the People's Republic of China hu jintao

March 16, 2007

Property law of the People's Republic of China

(adopted at the fifth session of the tenth National People's Congress on March 16, 2007)

Orders to record

Part I general rules

Chapter I basic principles

Chapter ii establishment, alteration, transfer and termination of real right

Section 1 real estate registration

Section 2 chattel delivery

Section iii other provisions

Chapter iii protection of real right

Part ii ownership

Chapter iv general provisions

Chapter v state ownership, collective ownership and private ownership

Chapter vi condominium of the owner

Chapter 7 adjacent relations

Chapter viii co-ownership

Chapter ix special provisions on acquisition of ownership

Part iii usufructuary right

Chapter x general provisions

Chapter xi contracting and management rights of land

Chapter xii right to use construction land

Chapter xiii right to use homestead

Chapter xiv easement

Part iv real right guaranteed

Chapter xv general provisions

Chapter xvi mortgage

Section 1 general mortgage

Section 2 mortgage of maximum amount

Chapter 17 pledge

Section 1 pledge of chattel

Section 2 right pledge

Chapter xviii liens

Part 5 possession

Chapter 19 possession

Attached is

Part I general rules

Chapter I basic principles

Article 1 this law is enacted in accordance with the constitution with a view to safeguarding the basic economic system of the state, maintaining the order of the socialist market economy, clarifying the attribution of the property right of the property, giving full play to its effectiveness and protecting the real right of the right holder.

Article 2 this law shall apply to civil relations arising from the attribution and utilization of the property.

The term "property" as used in this law includes realty and chattel.Where a law provides that a right is an object of real right, such provisions shall apply.

The term "real right" as used in this law refers to the right of the obligee to exercise direct control and exclusive rights over specific objects according to law, including ownership, usufructuary right and real right for security.

Article 3 in the primary stage of socialism, the state adheres to the basic economic system with public ownership as the mainstay and multiple forms of ownership developing together.

The state consolidates and develops the public sector of the economy and encourages, supports and guides the development of the non-public sector.

The state implements a socialist market economy and guarantees the equal legal status and right to development of all market entities.

Article 4 the real right of the state, collectives, individuals and other right holders shall be protected by law, and may not be infringed upon by any entity or individual.

Article 5 the categories and contents of real right shall be prescribed by law.

Article 6 the creation, alteration, transfer or termination of the real right of a realty shall be registered in accordance with law.The establishment and transfer of the real right of a chattel shall be delivered in accordance with law.

Article 7 the acquisition and exercise of real right shall abide by the law, respect social morality and may not impair the public interest or the lawful rights and interests of others.

Article 8 where other relevant laws have special provisions on real right, such provisions shall prevail.

Chapter ii establishment, alteration, transfer and termination of real right

Section 1 real estate registration

Article 9 the creation, alteration, transfer or termination of the real right of a realty shall take effect upon registration in accordance with law;Unless otherwise provided by law, it has no effect unless registered.

The ownership of natural resources legally owned by the state may not be registered.

Article 10 the registration of a realty shall be handled by the registration organ in the place where the realty is located.

The state implements a unified registration system for immovable property.The scope, organs and methods of uniform registration shall be prescribed by laws and administrative regulations.

Article 11 in applying for registration, the parties concerned shall, according to different registration items, provide certificates of ownership and necessary materials such as the site and area of the realty boundary.

Article 12 the registration organ shall perform the following duties:

(1) to examine the ownership certificate and other necessary materials provided by the applicant;

(2) to inquire of the applicant about the relevant registration matters;

(3) truthfully and promptly register relevant matters;

(4) other duties prescribed by laws and administrative regulations.

Where further proof is needed for the relevant situation of the realty applied for registration, the registration organ may require the applicant to provide supplementary materials, and may conduct on-the-spot inspection when necessary.

Article 13 the registration organ shall not commit any of the following ACTS:

(1) to require an assessment of immovable property;

(2) repeat registration in the name of annual inspection;

(3) other ACTS beyond the scope of registration duties.

Article 14 where the creation, alteration, transfer or termination of the real right of a realty shall be registered in accordance with law, it shall take effect upon being recorded in the realty register.

Article 15 unless otherwise provided by law or otherwise agreed upon in the contract, a contract concerning the establishment, alteration, transfer or termination of the real right of a realty shall become effective upon its formation.Failure to register the real right shall not affect the validity of the contract.

Article 16 the realty registration book shall be the basis for the ownership and content of the real right.The realty register shall be administered by the registration institution.

Article 17 the ownership certificate of a realty shall be the proof that the right holder enjoys the real right of the realty.The items recorded in the realty ownership certificate shall be consistent with the realty registration book;If the records are inconsistent, the real estate register shall prevail, unless there is evidence proving that the real estate register is wrong.

Article 18 the obligee or interested party may apply for inquiring about or duplicating the registration materials, which shall be provided by the registration organ.

Article 19 if the obligee or interested party considers that the items recorded in the realty register are wrong, it may apply for correction of the registration.Where the obligee recorded in the realty registration book agrees in writing to make the correction or there is evidence proving that there is indeed a mistake in the registration, the registration organ shall make the correction.

If the obligee recorded in the realty register does not agree to the correction, the interested party may apply for the objection registration.Where an opposition registration is granted by the registration organ, the applicant shall not file a lawsuit within 15 days from the date of opposition registration, and the opposition registration shall become invalid.Where the improper registration of the opposition causes damage to the right holder, the right holder may claim damages from the applicant.

Article 20 where the parties enter into an agreement for the sale and purchase of the real right of a house or other realty, they may, in order to guarantee the realization of the real right in the future, apply to the registration organ for advance notice registration.After the advance notice registration, any disposal of the realty without the consent of the obligee of the advance notice registration shall not have the effect of real right.

After the advance notice registration, if the creditor's right is extinguished or the application for registration is not made within three months from the date on which the realty registration can be conducted, the advance notice registration shall become invalid.

Article 21 if a party provides false materials to apply for registration and causes damage to others, it shall be liable for compensation.

If the registration error causes damage to another person, the registration organ shall be liable for compensation.After making compensation, the registration organ may recover compensation from the person who caused the registration error.

Article 22 the realty registration fee shall be charged on a per piece basis, and shall not be charged on the basis of the area, volume or proportion of the realty's price.The specific charge standards shall be formulated by the relevant departments of the state council together with the competent pricing departments.

Section 2 chattel delivery

Article 23 the establishment and transfer of the real right of a chattel shall take effect upon delivery, except as otherwise provided by law.

Article 24 the creation, alteration, transfer or termination of the real right of a ship, aircraft or motor vehicle, etc. may not be waged against a third party in good faith without registration.

Article 25 where, prior to the establishment or transfer of the real right of a chattel, the right over the chattel has been possessed by the obligee according to law, the real right shall take effect upon the effective date of the legal act.

Article 26 where a third party lawfully possesses a chattel prior to the establishment or transfer of the real right of a chattel, the person who has the obligation to deliver the chattel may, instead of delivering the chattel, request the third party to return the original object through the transfer.

Article 27 where the real right of a chattel is transferred and both parties agree that the transferor shall continue to possess the chattel, the real right shall come into force upon the effective date of the agreement.

Section iii other provisions

Article 28 where the creation, alteration, transfer or termination of a real right is caused by a legal document of a people's court or an arbitration commission or a decision of a people's government on the expropriation, it shall become effective upon the effective date of the legal document or a decision of the people's government on the expropriation.

Article 29 where a real right is acquired by inheritance or bequest, it shall become effective upon the commencement of the inheritance or bequest.

Article 30 the creation or termination of a real right by means of a factual act such as the lawful construction or demolition of a house shall take effect upon the achievement of the factual act.

Article 31 where the real right of a realty is enjoyed in accordance with the provisions of articles 28 to 30 of this law, the real right shall not be effective until it is registered in accordance with legal provisions when the real right is disposed of.

Chapter iii protection of real right

Article 32 where a real right is infringed upon, the right holder may settle the case by means of conciliation, mediation, arbitration or litigation.

Article 33 where disputes arise over the ownership or content of real right, interested parties may request confirmation of the right.

Article 34 where a realty or chattel is in the unauthorized possession, the right holder may request the return of the original object.

Article 35 where a real right is obstructed or is likely to be obstructed, the obligee may request the removal of the obstruction or the elimination of the danger.

Article 36 where a realty or chattel is damaged, the right holder may request for repair, rework, replacement or restoration of the original state.

Article 37 where an infringement on a real right causes damage to the right holder, the right holder may claim damages or other civil liabilities.

Article 38 the mode of protection of real right provided for in this chapter may be applied separately or combined in light of the infringement of the right.

Where a real right is infringed upon, in addition to civil liability, it shall be subject to administrative liability in accordance with law in case of violation of administrative regulations;If the case constitutes a crime, criminal responsibility shall be investigated according to law.

Part ii ownership

Chapter iv general provisions

Article 39 the owner shall, in accordance with law, enjoy the right to possess, use, profit from and dispose of his realty or chattel.

Article 40 the owner shall have the right to establish usufructuary right and real right for security over his realty or chattel.When exercising their rights, the usufructuary or real right for security may not prejudice the rights and interests of the owner.

Article 41 no entity or individual may acquire ownership of realty or chattel exclusively owned by the state as provided by law.

Article 42 land owned by collectives, houses owned by units or individuals and other realties may be expropriated for public interests in accordance with the limits of authority and procedures prescribed by law.

For the expropriation of collectively-owned land, the land compensation fee, resettlement fee, land attachment fee and young crops compensation fee shall be paid in full according to law, and the social security fee shall be arranged for the peasants whose land is expropriated, so as to guarantee their livelihood and safeguard their legitimate rights and interests.

For the expropriation of houses and other realties owned by units or individuals, compensation for demolition and removal shall be given according to law to safeguard the lawful rights and interests of the expropriated persons;In the case of expropriation of an individual's residence, the living conditions of the person expropriated shall also be guaranteed.

No unit or individual may embezzle, misappropriate, privately distribute, withhold or delay in collecting compensation fees.

Article 43 the state shall give special protection to cultivated land, strictly limit the conversion of agricultural land to construction land and control the total amount of construction land.Collectively-owned land shall not be expropriated in violation of the limits of authority and procedures prescribed by law.

Article 44 the realty or chattel of a unit or individual may be requisition in accordance with the limits of authority and procedures prescribed by law for urgent needs such as emergency rescue or disaster relief.After the realty or chattel is used, it shall be returned to the requisitioned person.Where the realty or chattel of an entity or individual is damaged or lost after requisition, compensation shall be given.

Chapter v state ownership, collective ownership and private ownership

Article 45 property that is owned by the state as prescribed by law shall be owned by the state, that is, by the whole people.

The state council shall exercise the ownership of state-owned property on behalf of the state;If there are other provisions of law, such provisions shall prevail.

Article 46 mineral deposits, currents and sea areas shall be owned by the state.

Article 47 land in cities shall be owned by the state.Land in rural and suburban areas that is owned by the state as provided by law shall be owned by the state.

Article 48 forests, mountains, grasslands, unreclaimed land, beaches and other natural resources shall be owned by the state, except for those that are owned by collectives as stipulated by law.

Article 49 the wildlife resources that are owned by the state as prescribed by law shall be owned by the state.

Article 50 radio spectrum resources are owned by the state.

Article 51 cultural relics that are owned by the state as prescribed by law shall be owned by the state.

Article 52 national defense assets shall be owned by the state.

Railways, highways, electric power facilities, telecommunications facilities, oil and gas pipelines and other infrastructure, which are owned by the state in accordance with law, shall be owned by the state.

Article 53 state organs shall have the right to possess, use and dispose of realty or chattel directly controlled by them in accordance with the law and the relevant provisions of the state council.

Article 54 public institutions established by the state shall have the right to possess, use and, in accordance with the law and the relevant provisions of the state council, to profit from and dispose of the realties and chattels directly controlled by them.

Article 55 for enterprises funded by the state, the state council and local people's governments shall, in accordance with the provisions of laws and administrative regulations, respectively perform the functions and enjoy the rights and interests of investors on behalf of the state.

Article 56 state-owned property shall be protected by law, and no unit or individual shall be allowed to encroach upon, encroach upon, privately divide, withhold or destroy it.

Article 57 the institutions and their staff that perform the duties of administration and supervision of state-owned property shall strengthen the administration and supervision of state-owned property in accordance with law, promote the maintenance and appreciation of state-owned property and prevent its losses;Those who abuse their powers and neglect their duties, thus causing losses of state-owned property, shall bear legal liabilities according to law.

Those who, in violation of the provisions on the administration of state-owned property, transfer state-owned property at a low price, collude with others in the process of restructuring, merger, division or affiliated transactions, or guarantee state-owned property without authorization, or otherwise cause losses thereof, shall bear legal liabilities according to law.

Article 58 collectively-owned realties and movables include:

(1) land, forests, mountains, grasslands, unreclaimed land and beaches that are collectively owned by law;

(2) collectively-owned buildings, production facilities and irrigation and water conservancy facilities;

(3) collectively-owned educational, scientific, cultural, public health and sports facilities;

Other realties and chattels owned collectively.

Article 59 the realties and chattels owned by peasant collectives shall be collectively owned by their members.

The following matters shall be decided by the members of the collective in accordance with legal procedures:

(1) the land contracting scheme and the contracting out of land to units or individuals other than the collective;

(2) adjustment of contracted land among individual holders of land contracting management rights;

(3) methods for the use and distribution of land compensation fees and other expenses;

(4) changes in the ownership of collectively-funded enterprises;

(5) other matters prescribed by law.

Article 60 ownership of land, forests, mountains, grasslands, unreclaimed land and beaches owned by collectives shall be exercised in accordance with the following provisions:

(1) if it is collectively owned by peasants of the village, the collective economic organization of the village or the villagers committee shall exercise the ownership on behalf of the collective;

(2) if it is owned separately by two or more peasant collectives in a village, the ownership shall be collectively exercised by the respective economic collectives or villagers' groups in the village on behalf of the collective;

(3) if it is owned by township peasant collectives, the township economic collectives shall exercise the ownership on behalf of the collectives.

Article 61 urban collectives shall, in accordance with the provisions of laws and administrative regulations, enjoy the right to possess, use, profit from and dispose of the realty and chattel owned by them.

Article 62 a collective economic organization, a villagers committee or a villagers' group shall, in accordance with laws, administrative regulations, articles of association and village rules and regulations, make public the status of collective property to its members.

Article 63 collectively-owned property shall be protected by law and no unit or individual may encroach upon, plunder, privately divide or destroy it.

Where a decision made by a collective economic organization, a villagers committee or its responsible person infringes upon the lawful rights and interests of a collective member, the aggrieved collective member may request the people's court to revoke the decision.

Article 64 private persons shall enjoy ownership of their lawful incomes, houses, articles for daily use, means of production, raw materials and other realties and chattels.

Article 65 the lawful savings, investments and earnings of individuals shall be protected by law.

The state shall, in accordance with law, protect the right of inheritance and other lawful rights and interests of individuals.

Article 66 the lawful property of a private person shall be protected by law and no unit or individual may encroach upon, plunder or destroy it.

Article 67 the state, collectives and individuals may, according to law, make capital contributions to establish limited liability companies, joint stock limited companies or other enterprises.Where any realty or chattel owned by the state, collective or private is invested in an enterprise, the investor shall enjoy the rights of earning income from the assets, making major decisions and selecting management and management personnel and perform his obligations in accordance with the provisions or proportion of capital contribution.

Article 68 an enterprise legal person shall, in accordance with laws, administrative regulations and articles of association, enjoy the rights of possession, use, profit and disposal of its realty and chattel.

For legal persons other than enterprise legal persons, the provisions of relevant laws, administrative regulations and articles of association shall apply to the rights of their realties and chattels.

Article 69 realty and chattel owned by public organizations according to law shall be protected by law.

Chapter vi condominium of the owner

Article 70 an owner shall enjoy the ownership of the exclusive parts of the building, such as the residential and commercial buildings, and the right to co-own and co-manage the common parts other than the exclusive parts.

Article 71 an owner shall have the right to possess, use, profit from and dispose of the exclusive parts of the building.The exercise of the right by the owner shall not endanger the safety of the building or impair the lawful rights and interests of other owners.

Article 72 an owner shall enjoy the rights and assume the obligations with respect to the common parts other than the exclusive parts of the building;No one may abandon his right or fail to perform his obligation.

Where the owner transfers the residential or operational premises in the building, the rights of joint ownership and joint management enjoyed by the owner shall be transferred together.

Article 73 roads within the building area shall be jointly owned by the owners, except those that are public roads in cities and towns.The green land within the building area shall be jointly owned by the owners, with the exception of those belonging to urban public green land or those expressly belonging to individuals.Other public places, public facilities and houses for use of realty services within the building area shall be jointly owned by the owners.

Article 74 the parking Spaces and garages planned for parking automobiles within the building zoning shall first meet the needs of the owners.

The ownership of the parking Spaces and garages planned to be used for parking cars shall be agreed upon by the parties concerned through such means as selling, donating or renting.

The parking Spaces occupied by roads or other places commonly owned by the owner for parking cars shall be jointly owned by the owner.

Article 75 an owner may establish an owners' assembly and elect an owners' committee.

The relevant departments of the local people's governments shall provide guidance and assistance to the establishment of the owners' assembly and the election of the owners' committees.

Article 76 the following matters shall be decided jointly by the owners:

(1) to formulate and amend the rules of procedure of the owners' meeting;

(2) to formulate and modify management protocols for buildings and their ancillary facilities;

(3) to elect or replace members of the owners' committee;

(4) selecting and dismissing the realty service enterprise or other managers;

(5) to raise and use funds for the maintenance of the buildings and their ancillary facilities;

(6) rebuilding or rebuilding buildings and their ancillary facilities;

(7) other major matters concerning the joint and co-management rights.

The decision on the matters specified in subparagraphs 5 and 6 of the preceding paragraph shall be subject to the consent of owners whose exclusive parts account for more than two-thirds of the total building area and more than two-thirds of the total number of owners.The decision on other matters mentioned in the preceding paragraph shall be subject to the consent of the owners whose exclusive parts account for more than half of the total area of the building and more than half of the total number of owners.

Article 77 an owner may not change a residence into a business house in violation of laws, regulations or management regulations.Where the owner changes the residential house into a house for business use, the consent of the interested owner shall be obtained, in addition to abiding by laws, regulations and management regulations.

Article 78 the decision of the owners' assembly or the owners' committee shall be binding on the owners.

Where a decision made by the owners' assembly or the owners' committee infringes upon the legitimate rights and interests of the owner, the aggrieved owner may request the people's court to revoke the decision.

Article 79 the maintenance funds for the building and its ancillary facilities shall be jointly owned by the owners.After the owner jointly decided, can be used for elevator, water tank and other common parts of the maintenance.The raising and use of maintenance funds shall be made public.

Article 80 where there is an agreement on such matters as the apportionment of expenses and the distribution of profits of the building and its ancillary facilities, the agreement shall prevail;If there is no agreement or the agreement is not clear, the proportion of the exclusive part of the owner to the total area of the building shall be determined.

Article 81 an owner may manage the building and its ancillary facilities by himself, or may entrust a realty service enterprise or other manager with management.

The owner shall have the right to replace the realty service enterprise or other manager hired by the construction unit according to law.

Article 82 a realty service enterprise or other manager shall, according to the authorization of the owner, manage the buildings and their ancillary facilities within the building zoning and accept the owner's supervision.

Article 83 the owner shall abide by laws, regulations and management regulations.

The owners' congress and the owners' committee, indiscriminate disposal of waste, the discharge of pollutants and noise, in violation of regulations animals, illegal building, encroach on channel, refuse to pay property management fee, etc. The behavior of the damage the legitimate rights and interests of others, have the right to, in accordance with the laws, regulations and management stipulations, require person to stop the infringement, eliminate the danger, ruled out sabotage, compensate for the losses.An owner may, in accordance with law, bring a lawsuit in a people's court against an act infringing upon his lawful rights and interests.

Chapter 7 adjacent relations

Article 84 adjacent obligee of a realty shall correctly handle the adjacent relationship in accordance with the principles of benefiting production, facilitating life, solidarity and mutual assistance, fairness and rationality.

Article 85 where laws or regulations provide for the handling of adjacent relations, such provisions shall apply;In the absence of such provisions, local customs may be followed.

Article 86 the right holder of a realty shall provide necessary facilities for the water and drainage of his neighbors.

The utilization of natural flowing water shall be reasonably distributed among the adjacent right holders of the realty.When discharging natural running water, the natural direction of flow shall be respected.

Article 87 where the right holder of a realty has to use his land for passage or other purposes, he shall provide necessary facilities.

Article 88 where the right holder of realty must make use of adjacent land or buildings for building or repairing buildings or laying electric, cable, water, heating and gas pipelines, etc., the right holder of such land or buildings shall provide necessary conveniences.

Article 89 when a building is constructed, it shall not violate the relevant state standards for project construction, thereby obstructing the ventilation, lighting and sunlight of adjacent buildings.

Article 90 the right holder of a realty shall not, in violation of state regulations, abandon solid waste or discharge such harmful substances as air pollutants, water pollutants, noise, light and electromagnetic radiation.

Article 91 the right holder of a realty may not endanger the safety of adjacent realty by digging up land, constructing buildings, laying pipelines and installing equipment.

Article 92 where the right holder of a realty USES a neighboring realty for water, drainage, passage, pipeline laying, etc., he shall, as far as possible, avoid causing damage to the right holder of a neighboring realty;Compensation shall be paid if damage is caused.

Chapter eight altogether

Article 93 a realty or chattel may be jointly owned by two or more units or individuals.Co-ownership includes co-ownership by shares and co-ownership.

Article 94 a co-owner shall enjoy ownership in proportion to his share of the realty or chattel jointly owned by him.

Article 95 the co-owners shall jointly enjoy the ownership of the jointly owned realty or chattel.

Article 96 the co-owners shall administer the jointly owned realty or chattel in accordance with the agreement;Where there is no agreement or the agreement is not clear, each co-owner shall have the right and obligation of management.

Article 97 the disposal of a jointly owned realty or chattel or the major repair of a jointly owned realty or chattel shall be subject to the consent of the joint owners or all joint owners who account for more than two-thirds of the shares, unless there is otherwise an agreement among the joint owners.

Article 98 where there is an agreement on the management expenses and other expenses for the common property, such agreement shall prevail;If there is no agreement or the agreement is not clear, the joint owners shall bear the burden according to their shares and the joint owners shall bear the burden jointly.

Article 99 where the co-owners agree that the realty or chattel jointly owned shall not be divided, in order to maintain the relationship of co-ownership, the agreement shall be followed.Where there is no agreement or the agreement is not clear, the co-owners according to the shares may request the division at any time, and the co-owners may request the division when the basis of the joint ownership is lost or there are serious reasons for the division.Where the partition causes damage to other co-owners, compensation shall be paid.

Article 100 the co-owners may determine the mode of partition through consultation.Where no agreement can be reached, the realty or chattel jointly owned may be divided and the value of the realty or chattel may not be diminished by the division, the real property shall be divided;If the value is difficult to be divided or will be reduced due to the division, the proceeds from the conversion or auction or sale shall be divided.

Where the realty or chattel acquired by the co-owner is defective, the other co-owners shall share the losses.

Article 101 a co-owner may transfer his share of the common realty or chattel enjoyed by him according to the shares.Other co-owners shall enjoy the right of priority in the purchase under the same conditions.

Article 102 with respect to the creditor's rights and debts arising from the jointly owned realty or chattel, the co-owners shall enjoy joint and several creditor's rights and assume joint and several debts with respect to external relations, except as otherwise provided by law or where a third party knows that the co-owners do not have joint and several creditor's rights and debts;In terms of the internal relations of the co-owners, unless the co-owners agree otherwise, the co-owners shall enjoy the creditor's rights and assume the debts according to their shares, and the co-owners shall jointly enjoy the creditor's rights and assume the debts according to their shares.Where the repayment of debts exceeds the proportion to be borne by the joint owners, the joint owners shall have the right to claim recovery from the other joint owners.

Article 103 where the co-owners do not agree that the realty or chattel jointly owned is jointly owned by shares or jointly owned, or the agreement is not clear, the co-owners shall be deemed to be jointly owned by shares, except that the co-owners have family relations, etc.

Article 104 where there is no agreement or the agreement is not clear on the share of the realty or chattel jointly owned by a co-owner by shares, the amount of contribution shall be determined;Where the amount of capital contribution cannot be determined, it shall be deemed to be equally enjoyed.

Article 105 where two or more entities or individuals jointly enjoy usufructuary right or real right for security, the provisions of this chapter shall be referred to.

Chapter ix special provisions on acquisition of ownership

Article 106 where a realty or chattel is transferred to the transferee by a person without power of decentralization, the owner shall have the right to recover it;Unless otherwise provided by law, the transferee shall acquire the ownership of the realty or chattel in the following circumstances:

(1) the transferee is bona fide when he accepts the realty or chattel;

(2) transfer at a reasonable price;

(3) a realty or chattel transferred which should be registered according to law has been registered and the one which does not need to be registered has been delivered to the transferee.

Where the transferee has acquired ownership of the realty or chattel in accordance with the provisions of the preceding paragraph, the original owner shall have the right to claim compensation for losses from the person who has no power to distribute the realty or chattel.

Where the parties acquire other real rights in good faith, the provisions of the preceding two paragraphs shall be referred to.

Article 107 the owner or any other right holder shall have the right to recover the lost property.The lost property through transfer by others possession, the right holder has the right to claim damages to the person with unauthorized disposition, or since he knows or should know the transferee within two years from the date of the assignee, request return the original items, but the transferee purchased through auction or operators having business qualification to the lost property, the holder of the request to return the original items shall be paid when the transferee pays fee.After the obligee pays the fee to the assignee, he shall have the right to claim compensation from the person who has no power of decentralization.

Article 108 upon the acquisition of a chattel by the bona fide assignee, the original rights in the chattel are extinguished, except where the bona fide assignee knew or should have known the right at the time of the transfer.

Article 109 if a lost property is found, it shall be returned to the right owner.The finder shall promptly notify the obligee of the claim or hand it over to the public security department or other relevant departments.

Article 110 if the departments concerned have received the lost property and are aware of the obligee, they shall promptly notify him to claim it.If they do not know about it, they shall promptly issue a public notice for claiming it.

Article 111 before the finder delivers the lost property to the relevant department, the relevant department shall take proper care of the lost property before it is claimed.If the lost property is damaged or lost due to intentional or gross negligence, civil liability shall be borne.

Article 112 when collecting the lost property, the obligee shall pay the finder or the department concerned the necessary expenses for keeping the lost property.

Where the obligee offers a reward for finding the lost property, the obligee shall perform his obligations in accordance with his promise when collecting the lost property.

Where the finder encroaches on the lost property, he shall not have the right to claim the expenses for keeping the lost property or to request the obligee to perform his obligations as promised.

Article 113 if a lost property is not claimed within six months from the date of issuing a public notice to find it, it shall be owned by the state.

Article 114 whoever finds a drifting object or finds a buried or hidden object shall refer to the relevant provisions on finding a lost object.Where there are other provisions in laws such as the law on the protection of cultural relics, such provisions shall apply.

Article 115 where the principal property is transferred, the subordinate property is transferred with the principal property, except as otherwise agreed by the parties.

Article 116 natural fruits shall be enjoyed by the owner;If there are both owners and usufructuary right holders, they shall be acquired by usufructuary right holders.If the parties agree otherwise, the agreement shall prevail.

If the parties have an agreement on legal fruits, they shall obtain such fruits in accordance with the agreement;If there is no agreement or the agreement is not clear, it shall be obtained in accordance with the transaction practice.

Part iii usufructuary right

Chapter x general provisions

Article 117 a usufructuary right holder shall, according to law, enjoy the right to possess, use and profit from a realty or chattel owned by another person.

Article 118 natural resources owned by the state or by collectives and that are collectively owned by law may be possessed, used and profited from by units or individuals in accordance with law.

Article 119 the state practices a system of compensated use of natural resources, except as otherwise provided by law.

Article 120 in exercising its rights, a usufructuary right holder shall abide by the provisions of the law on the protection, rational development and utilization of resources.The owner shall not interfere in the exercise of the right by the usufructuary.

Article 121 where the usufructuary right is eliminated or the exercise of the usufructuary right is affected by the expropriation or requisition of a realty or chattel, the usufructuary right holder shall have the right to obtain corresponding compensation in accordance with the provisions of articles 42 and 44 of this law.

Article 122 the right to the use of sea areas acquired in accordance with law shall be protected by law.

Article 123 the right of exploration, mining and water intake obtained in accordance with law and the right to use water areas or tidal flats for breeding and fishing shall be protected by law.

Chapter xi contracting and management rights of land

Article 124 rural collective economic organizations shall adopt a two-tier operation system based on the household contract operation and based on the combination of unified management and separate management.

Farmland, forest land, grassland and other land used for agriculture collectively owned by farmers and collectively owned by the state shall be contracted out for operation according to law.

Article 125 the holder of the right to the contracted management of land shall, in accordance with law, have the right to possess, use and earn profits from the farmland, woodland and grassland contracted for operation, and shall have the right to engage in farming, forestry, animal husbandry and other agricultural production.

Article 126 the contracted period for cultivated land is 30 years.Grassland is contracted for 30 to 50 years.The contracted period for forestland is 30 to 70 years;The contracted period of woodlands for special trees may be extended with the approval of the competent forestry administration department under the state council.

At the expiration of the contract period prescribed in the preceding paragraph, the person with the right to contract the land shall continue to do so in accordance with the relevant provisions of the state.

Article 127 the right to the contracted management of land shall be established upon the effective date of the contract for the contracted management of land.

The local people's governments at or above the county level shall issue to the holders of the right to the contracted management of land certificates of ownership of land, certificates of ownership of forests and certificates of ownership of grasslands, and put them on record to confirm the contracted management of land.

Article 128 the holder of the right to the contracted management of land shall, in accordance with the provisions of the rural land contracting law, have the right to transfer the right to the contracted management of land through subcontracting, exchange and transfer.The term of circulation shall not exceed the remaining term of the contract period.No contracted land may be used for non-agricultural construction without approval according to law.

Article 129 where the holder of the right to the contracted management of land exchanges or transfers the right to the contracted management of land and the parties concerned request registration, they shall apply to the local people's governments at or above the county level for registration of alteration of the right to the contracted management of land.No third party in good faith may be confronted without registration.

Article 130 the employer shall not adjust the contracted land within the term of the contract.

In case of serious damage to contracted land due to natural disasters and other special circumstances, it is necessary to adjust the contracted farmland and grassland appropriately, it shall be handled in accordance with the rural land contracting law and other legal provisions.

Article 131 the employer may not take back the contracted land within the term of the contract.If there are other provisions in the rural land contract law or other laws, such provisions shall apply.

Article 132 where the land contracted for is expropriated, the owner of the right to the contracted management of land shall have the right to receive corresponding compensation in accordance with paragraph 2 of article 42 of this law.

Article 133 for contracted rural land such as wasteland through bidding, auction and open consultation, the contracted land-use right may be transferred, become a shareholder, mortgaged or otherwise transferred in accordance with the rural land contracting law and other laws and the relevant provisions of the state council.

Article 134 the relevant provisions of this law shall be applied to the contracted management of state-owned agricultural land.

Chapter xii right to use construction land

Article 135 the owner of the right to the use of construction land shall, in accordance with law, have the right to possess, use and profit from the state-owned land and shall have the right to use the land to construct buildings, structures and ancillary facilities.

Article 136 the right to use construction land may be established separately at the surface, above or below the surface of the land.The newly-established right to the use of construction land may not prejudice the usufructuary right already established.

Article 137 the right to the use of construction land may be established by way of assignment or allocation.

Where there are two or more intended users of the same land for industrial, commercial, tourism, entertainment and commercial housing purposes, the land shall be sold by way of public bidding, such as bidding or auction.

The establishment of the right to use construction land by means of allocation is strictly restricted.Those who adopt the mode of allocation shall abide by the provisions of laws and administrative regulations on the use of land.

Article 138 where the right to the use of construction land is established by means of assignment such as bidding, auction or agreement, the parties shall enter into a contract in writing for the right to the use of construction land.

A contract for the grant of the right to use construction land generally includes the following terms:

(1) names and addresses of the parties;

(2) land boundary site and area, etc.;

(3) space occupied by buildings, structures and ancillary facilities;

Land use;

(5) term of use;

(6) assignment fees and other fees and the method of payment thereof;

(7) methods of dispute resolution.

Article 139 whoever establishes the right to the use of construction land shall apply to the registration organ for registration of the right to the use of construction land.The right to use construction land shall be established upon registration.The registration organ shall issue a certificate for the right to use construction land to the owner of the right to use construction land.

Article 140 the land-use right holder for construction land shall make rational use of the land and shall not change the purpose of the land.If the land use needs to be changed, it shall be approved by the relevant administrative departments according to law.

Article 141 the owner of the right to use construction land shall pay the assignment fee and other fees in accordance with the law and the contract.

Article 142 the ownership of the buildings, structures and ancillary facilities constructed by the owner of the right to the use of construction land shall belong to the owner of the right to the use of construction land, except as proved by evidence to the contrary.

Article 143 the owner of the right to the use of construction land shall have the right to transfer, exchange, contribute, donate or mortgage the right to the use of construction land, except as otherwise provided by law.

Article 144 where the right to the use of construction land is transferred, exchanged, contributed, given or mortgaged, the parties shall enter into an appropriate contract in writing.The term of use shall be agreed upon by the parties, but shall not exceed the remaining term of the right to use construction land.

Article 145 where the right to the use of construction land is transferred, exchanged, invested or donated, an application for alteration registration shall be filed with the registration organ.

Article 146 where the right to the use of construction land is transferred, exchanged, contributed or donated, the buildings, structures and attached facilities attached to the land shall be disposed of at the same time.

Article 147 where buildings, structures and attached facilities are transferred, exchanged, contributed or donated, the right to the use of construction land within the limits occupied by such buildings, structures and attached facilities shall be disposed of at the same time.

Article 148 where the right to the use of construction land needs to be recovered in advance due to public interests before the expiration of the term, compensation shall be made for the houses and other immovable properties on the land in accordance with the provisions of article 42 of this law, and the corresponding transfer fee shall be returned.

Article 149 upon expiration of the term of the right to use residential construction land, the term shall be automatically renewed.

The renewal of the right to the use of non-residential construction land upon expiration shall be handled in accordance with the law.Where there is an agreement on the ownership of houses and other realties on the land, the agreement shall apply;Where there is no agreement or the agreement is not clear, the matter shall be handled in accordance with the provisions of laws and administrative regulations.

Article 150 where the right to use construction land is extinguished, the transferor shall promptly go through cancellation registration.The registration organ shall withdraw the certificate for the right to use construction land.

Article 151 collectively-owned land used for construction purposes shall be handled in accordance with the land administration law and other legal provisions.

Chapter xiii right to use homestead

Article 152 the owner of the right to the use of house sites shall, in accordance with law, enjoy the right to possess and use collectively-owned land and shall have the right to use the land for building houses and ancillary facilities according to law.

Article 153 the acquisition, exercise and transfer of the right to the use of house sites shall be governed by the land administration law and other laws and the relevant provisions of the state.

Article 154 where a homestead is lost due to natural disasters or other causes, the right to use the homestead shall be extinguished.For the villagers who have lost their homestead, the homestead shall be redistributed.

Article 155 in the case of the transfer or termination of the registered right to the use of house sites, registration for alteration or cancellation shall be made without delay.

Chapter xiv easement

Article 156 the easement holder has the right to use the realty of others to improve the benefit of his own realty in accordance with the contract.

The realty of another person referred to in the preceding paragraph is servitude land, and the realty of one's own is servitude land.

Article 157 to establish an easement, the parties concerned shall enter into an easement contract in writing.

Easement contracts generally include the following terms:

(1) the names and domiciles of the parties;

(2) the location of servient land and servient land;

(3) purpose and method of utilization;

(4) term of utilization;

(5) fees and payment methods;

(6) methods of dispute resolution.

Article 158 an easement shall be established when the easement contract comes into force.Where the parties require registration, they may apply to the registration organ for registration of easement;No third party in good faith may be confronted without registration.

Article 159 the obligee of a servitude shall, in accordance with the contract, allow the easement holder to use his land and shall not hinder the easement holder from exercising his right.

Article 160 the easement owner shall make use of the servient land according to the purpose and method stipulated in the contract, and minimize the restriction on the real right of the obligee of the servient land.

Article 161 the term of an easement shall be agreed upon by the parties concerned, but it shall not exceed the remaining term of the usufructuary right such as the right to the contracted management right of land or the right to the use of construction land.

Article 162 where a land owner enjoys or assumes an easement, when establishing the right to the contracted management of land or the right to the use of house sites, the right to the contracted management of land or the right to the use of house sites shall continue to enjoy or assume the easement already established.

Article 163 where the right to the contracted management right of land, the right to the use of construction land, the right to the use of house sites, etc. has been established on the land, the land owner may not establish an easement without the consent of the usufructuary right holder.

Article 164 the easement shall not be transferred separately.Where the right to the contracted management of land or the right to the use of construction land is transferred, the easement shall be transferred together, except as otherwise agreed in the contract.

Article 165 an easement may not be mortgaged separately.Where the right to the contracted management of land or the right to the use of construction land is mortgaged, the easement shall be transferred together with the realization of the mortgaged right.

Article 166 where part of the assignment involves an easement, the transferee shall enjoy the easement at the same time.

Article 167 where part of the transfer of the servient land, the right to the contracted management of land and the right to use construction land on the servient land involves an easement, the easement shall be binding on the transferee.

Article 168 where the easement owner falls into any of the following circumstances, the obligee of the servitude has the right to terminate the easement contract and the easement shall be terminated:

(1) abuse of easement in violation of legal provisions or contractual provisions;

(2) where the paid use of servient land is not paid within a reasonable period after the expiration of the agreed payment period.

Article 169 where the registered easement is altered, transferred or terminated, the alteration registration or cancellation registration shall be handled in time.

Part iv real right guaranteed

Chapter xv general provisions

Article 170 where the obligor fails to perform the obligations due or the realisation of the real right for security as agreed by the parties, the mortgagor has the right of priority in repayment with respect to the secured property, except as otherwise provided by law.

Article 171 where a creditor needs security in order to guarantee the realization of his obligatory right in civil activities such as borrowing, lending, buying and selling, etc., he may establish a real right for security in accordance with the provisions of this law and other laws.

Where a third party provides security to the obligee for the obligor, it may require the obligor to provide counter-security.The provisions of this law and other laws shall apply to counter-guarantees.

Article 172 to establish a real right for security, a security contract shall be concluded in accordance with this law and other laws.A security contract is a subordinate contract of a principal creditor's right and debt contract.Unless otherwise provided by law, a contract for principal creditor's rights and debts shall be null and void, and a security contract shall be null and void.

After a guarantee contract is confirmed to be invalid, if the debtor, guarantor or creditor is at fault, they shall bear corresponding civil liability according to their respective faults.

Article 173 the scope of security for a real right for security shall include the principal obligatory right and its interest, liquidated damages, damages, expenses for keeping the property for security and expenses for realizing the real right for security.If the parties agree otherwise, the agreement shall prevail.

Article 174 during the period of security, if the security property is damaged, lost or expropriated, the security right holder may have priority in compensation for the insurance money, compensation or compensation received.Where the period for performance of the secured obligatory right has not expired, the insurance money, compensation or compensation may also be deposited.

Article 175 where a third party provides security and the obligee permits the obligor to transfer all or part of the debt without the written consent of the third party, the guarantor shall no longer bear the corresponding security liability.

Article 176 where the obligatory right guaranteed is secured by both property and person, if the obligor fails to perform the obligations due or the realization of the security right as agreed upon by the parties, the obligee shall realize the obligatory right in accordance with the agreement;Where there is no agreement or the agreement is not clear, and the guarantee of the thing provided by the obligor himself, the obligee shall first realize the obligatory right with respect to the guarantee of the thing;Where the security provided by a third party is provided, the creditor may realize the creditor's right with respect to the security of the property, or may require the guarantor to assume the security liability.The third party providing the guarantee shall have the right to recover from the debtor after assuming the guarantee liability.

Article 177 the security right shall be extinguished in any of the following circumstances:

(1) the termination of the principal obligatory right;

Realization of real right for security;

(3) the creditor waives the right of security;

(4) other circumstances in which the real right for security is extinguished as stipulated by law.

Article 178 if the provisions of this law are inconsistent with those of this law, this law shall apply.

Chapter xvi mortgage

Section 1 general mortgage

Article 179 where, for the performance of a secured debt, the obligor or a third party does not transfer its possession and mortgage the property to the obligee, if the obligor fails to perform the debts due or the realization of the right of mortgage as agreed upon by the parties, the obligee shall have the right of priority in payment with respect to the property.

The debtor or the third party mentioned in the preceding paragraph shall be the mortgagor, the creditor shall be the mortgagee, and the property provided for security shall be the mortgaged property.

Article 180 the following properties which the obligor or a third party is entitled to dispose of may be mortgaged:

(1) buildings and other objects attached to the land;

(2) the right to use construction land;

(3) the contracted management rights of wasteland and other land acquired through bidding, auction and open consultation;

(4) production equipment, raw materials, semi-finished products and products;

(5) buildings, ships and aircraft under construction;

(6) means of transport;

(7) other property not prohibited by laws or administrative regulations from being mortgaged.

The mortgagor may mortgage all the properties listed in the preceding paragraph together.

Article one hundred and eighty-one a written agreement by all parties, enterprise, individual industrial and commercial households, agricultural production operators can be existing and some production equipment, raw materials, semi-finished products, products of mortgage, the debtor fails to perform due debts or agreed by the parties to the implementation of the mortgage right, the creditor shall have the right to mortgage is to realize the chattels seek preferred payments.

Article 182 where a building is mortgaged, the right to the use of construction land within the scope occupied by the building shall be mortgaged together.If the right to use construction land is mortgaged, the buildings on the land shall be mortgaged together.

Where the mortgagor fails to mortgage together in accordance with the provisions of the preceding paragraph, the unmortgaged property shall be deemed to be mortgaged together.

Article 183 the right to the use of construction land for township or village enterprises may not be mortgaged separately.The right to the use of construction land within the scope of its occupation shall be mortgaged together with the buildings such as factories of township or village enterprises.

Article 184 the following properties shall not be mortgaged:

(1) ownership of land;

(2) the right to the use of land owned by collectives such as cultivated land, house sites, private plots and private hills, except those that may be mortgaged as provided by law;

(3) educational facilities, medical and health facilities and other public welfare facilities of public institutions and public organizations such as schools, kindergartens, hospitals and other public welfare facilities;

(4) property whose ownership or right to use is unknown or in dispute;

(5) property that has been sealed up, distrained or supervised according to law;

(6) other property that may not be mortgaged as prescribed by laws or administrative regulations.

Article 185 to establish a mortgage right, the parties shall enter into a mortgage contract in writing.

A mortgage contract generally includes the following terms:

(1) the type and amount of the obligatory right guaranteed;

(2) the time limit for the obligor to perform its obligation;

(3) the name, quantity, quality, condition, location, ownership or right to use of the mortgaged property;

(4) the scope of the guarantee.

Article 186 the mortgagee may not, prior to the expiration of the term of performance of the debt, stipulate with the mortgagor that the mortgaged property shall be owned by the obligee when the obligor fails to perform the debt at maturity.

Article 187 where the property specified in items 1 through 3 of paragraph 1 of article 180 of this law or the building under construction is mortgaged, mortgage registration shall be conducted.The mortgage right shall be established at the time of registration.

Article 188 where the property provided for in subparagraphs 4 and 6 of paragraph 1 of article 180 of this law or the ship or aircraft under construction as provided for in subparagraphs 5 of this law is mortgaged, the mortgage right shall be established upon the commencement of the mortgage contract;No third party in good faith may be confronted without registration.

Article 189 where an enterprise, individual industrial or commercial household or agricultural production operator mortgages chattel as prescribed in article 181 of this law, it shall go through registration with the administrative department for industry and commerce of the place where the mortgagor has his domicile.The mortgage right shall be established upon the effective date of the mortgage contract;No third party in good faith may be confronted without registration.

Where a mortgage is made in accordance with the provisions of article 181 of this law, the buyer who has paid the reasonable price and obtained the mortgaged property in normal business activities may not be opposed.

Article 190 where the mortgaged property was leased prior to the conclusion of the mortgage contract, the original lease relationship shall not be affected by the mortgage.Where the mortgaged property is leased after the establishment of the mortgage, the lease relationship shall not be against the registered mortgage.

Article 191 during the period of mortgage, if the mortgagor transfers the mortgaged property with the consent of the mortgagee, he shall pay off the debts or place in escrow the proceeds from the transfer to the mortgagee in advance.The part of the transferred price that exceeds the amount of the obligatory right shall be owned by the mortgagor, and the insufficient part shall be paid by the debtor.

During the period of mortgage, the mortgagor may not transfer the mortgaged property without the consent of the mortgagee, except where the transferee cancles the mortgage by paying off the debts on behalf of the mortgagee.

Article 192 the mortgage right may not be separated from the obligatory right and transferred alone or as security for any other obligatory right.Where the obligatory right is transferred, the mortgage that guarantees the obligatory right shall be transferred at the same time, except as otherwise provided by law or agreed by the parties.

Article 193 where the act of the mortgagor is sufficient to reduce the value of the mortgaged property, the mortgagee shall have the right to demand that the act of the mortgagor be terminated.Where the value of the mortgaged property decreases, the mortgagee shall have the right to demand that the value of the mortgaged property be restored or to provide security corresponding to the reduced value.If the mortgagor does not restore the value of the mortgaged property or provide security, the mortgagee shall have the right to require the debtor to pay off the debts in advance.

Article 194 the mortgagee may renounce the right of mortgage or the next in succession thereof.The mortgagee and the mortgagor may agree to change the sequence of the mortgage right and the amount of the obligatory right guaranteed, but the alteration of the mortgage right shall not adversely affect the other mortgagees without the written consent of the other mortgagees.

Where the debtor establishes a mortgage with his own property and the mortgagee abandons the mortgage right, the sequence of the mortgage right or changes the mortgage right, the other guarantor shall be exempted from the guarantee liability within the scope of the loss of the priority of the mortgagee's rights and interests in compensation, but the other guarantor shall promise to still provide the guarantee except.

Article 195 where the debtor fails to perform the debts due or the realization of the mortgage right as agreed upon by the parties, the mortgagee may, through an agreement with the mortgagor, convert the mortgaged property into money or have priority in satisfying his claim out of the proceeds from the auction or sale of the mortgaged property.Where an agreement harms the interests of other creditors, other creditors may, within one year from the date on which they know or should know the cause for cancellation, request the people's court to cancel the agreement.

If the mortgagee and the mortgagor fail to reach an agreement on the means of realization of the mortgage right, the mortgagee may request the people's court to auction or sell off the mortgaged property.

Where the mortgaged property is converted into money or sold off, the market price shall be referred to.

Article 196 where a mortgage is established in accordance with article 181 of this law, the mortgaged property shall be determined when one of the following circumstances occurs:

(1) at the expiration of the term of performance of the debt, the creditor's right is not realized;

(2) the mortgagor is declared bankrupt or revoked;

(3) the circumstances under which the mortgage right is realized as agreed by the parties;

(4) other circumstances that seriously affect the realization of creditor's rights.

Article one hundred and ninety-seven the debtor fails to perform due debts or agreed by the parties to the implementation of the hypothec, causing the mortgaged property is held in the people's court in accordance with the law, from the date of seizure, the mortgagee has the right to collect the natural fruits of the mortgaged property or legal fruits, but the mortgagee fails to notify the person who has the obligation to pay legal fruits of the exception.

The fruits mentioned in the preceding paragraph shall first be used to cover the expenses for collecting the fruits.

Article 198 after the mortgaged property is converted into money or auctioned or sold off, the part of the proceeds in excess of the obligatory right shall be owned by the mortgagor, and the insufficient part shall be paid off by the obligor.

Article 199 if the same property is mortgaged to two or more creditors, the proceeds from the auction or sale of the mortgaged property shall be satisfied according to the following provisions:

(1) if the mortgage right has been registered, repayment shall be made according to the sequence of registration;If the order is the same, repayment shall be made according to the proportion of claims;

(2) where the mortgage right has been registered prior to the repayment of the unregistered mortgage right;

(3) if the mortgage right has not been registered, it shall be paid off according to the proportion of the obligatory right.

Article 200 after mortgaging the right to the use of construction land, the new buildings on the land shall not be mortgaged property.When the right to the use of the construction land is mortgaged, the newly added buildings on the land shall be disposed of together with the right to the use of the construction land, but the mortgagee shall not have the priority to receive compensation from the proceeds from the newly added buildings.

Article two hundred and one in accordance with the provisions of paragraph 3 of the first paragraph of article one hundred and eighty of the mortgage of the right to the contracted management of land or according to the provisions of article one hundred and eighty-three in factories and other buildings of township and village enterprises the right to use construction land within the scope of the mortgagor, the mortgagee shall, without legal procedures, may not change the nature of land ownership and land use.

Article 202 the mortgagee shall exercise the mortgage during the limitation period of action for the principal obligatory right;If it fails to do so, the people's court shall not protect it.

Section 2 mortgage of maximum amount

Article two hundred and three as the guarantee for the implementation of the debt, the debtor or a third party for a certain period will continuous happen the creditor's rights guarantee of property, the debtor fails to perform due debts or agreed by the parties to the implementation of the mortgage, the mortgagee has the right to the highest amount limits on the property for security to seek preferred payments.

With the consent of the parties concerned, the obligatory right already existing before the establishment of the mortgage right of maximum amount may be transferred to the scope of the obligatory right guaranteed by the mortgage of maximum amount.

Article 204 where part of the obligatory right guaranteed by the mortgage of the maximum amount is transferred before the determination of the obligatory right guaranteed by the mortgage of the maximum amount, the mortgage right of the maximum amount shall not be transferred, unless otherwise agreed by the parties.

Article 205 before the determination of the obligatory right guaranteed by the mortgage of the maximum amount, the mortgagee and the mortgagor may, through an agreement, alter the period, scope and maximum amount of the obligatory right determined, provided that the modified content shall not adversely affect the other mortgagees.

Article 206 the creditor's right of the mortgagee shall be determined under any of the following circumstances:

(1) the term of determining the obligatory right as agreed upon expires;

(2) where there is no agreement on the period for determining the obligatory right or the agreement is not clear, the mortgagee or the mortgagor requests to determine the obligatory right after the expiration of two years from the date on which the mortgage right of the maximum amount is established;

(3) new claims are unlikely to occur;

(4) the mortgaged property is sealed up or distrained;

(5) the debtor or mortgagor is declared bankrupt or revoked;

(6) other circumstances under which the obligatory right is determined as prescribed by law.

Article 207 in addition to the provisions of this section, the provisions of section 1 of this chapter on mortgage of maximum amount shall apply.

Chapter xvii pledge

Section 1 pledge of chattel

Where, for the performance of the secured debt, the obligor or a third party pledges its movable property to the obligee for possession, if the obligor fails to perform the debt due or the realization of the pledge agreed upon by the parties occurs, the obligee shall have the right to have priority in the repayment of the chattel.

The debtor or the third party mentioned in the preceding paragraph is the pledgor, the creditor is the pledgee, and the delivered chattel is the pledged property.

Article 209 movable property prohibited by law or administrative regulations from being transferred may not be pledged.

Article 210 to establish a pledge, the parties shall enter into a pledge contract in writing.

A pledge contract generally includes the following terms:

(1) the type and amount of the obligatory right guaranteed;

(2) the time limit for the obligor to perform its obligation;

(3) the name, quantity, quality and condition of the pledged property;

(4) the scope of the guarantee;

(5) the time for delivery of the pledged property.

Article 211 prior to the expiration of the debt performance period, the pledgee may not agree with the pledgor that the pledged property shall be owned by the creditor when the debtor fails to perform the due debt.

Article 212 the pledge right shall be established when the pledgor delivers the pledged property.

Article 213 the pledgee is entitled to collect the fruits of the pledged property, except as otherwise agreed upon in the contract.

The fruits mentioned in the preceding paragraph shall first be used to cover the expenses for collecting the fruits.

Article 214 where the pledgee, without the consent of the pledgor, USES or disposes of the pledged property during the duration of the pledgee's right, thereby causing damage to the pledgor, it shall be liable for compensation.

Article 215 the pledgee shall have the obligation to properly keep the pledged property;If the pledged property is damaged or lost due to improper keeping, it shall be liable for compensation.

Where the pledged property may be damaged or lost by the pledgee's behavior, the pledgor may require the pledgee to keep the pledged property, or demand repayment of the debt in advance and return of the pledged property.

Article 216 where the pledged property may be damaged or its value significantly reduced due to causes that cannot be attributed to the pledgee and are sufficient to endanger the rights of the pledgee, the pledgee shall have the right to require the pledgor to provide corresponding security;If the pledgor fails to provide, the pledgee may auction or sell off the pledged property and, through an agreement with the pledgor, pay off the debts or place in escrow the proceeds from the auction or sale in advance.

Article 217 where the pledged property is damaged or lost by the pledgee without consent of the pledgor during the duration of the pledge right, the pledgee shall be liable for compensation to the pledgor.

Article 218 the pledgee may waive the pledge.If the debtor pledges his property and the pledgee abandons the pledge, the other guarantor shall be exempted from the security liability within the scope of the loss of the priority of the right of repayment by the pledgee, except that the other guarantor promises to still provide security.

Article 219 where the obligor fulfils its obligations or the pledgor pays off the obligatory right secured in advance, the pledgee shall return the pledged property.

Where the debtor fails to perform the debts due or the pledge is realized as agreed by the parties, the pledgee may agree with the pledgor to keep the pledged property to offset the money, or may have priority in satisfying the proceeds from the auction or sale of the pledged property.

Where the pledged property is converted into money or sold off, the market price shall be referred to.

Article 220 the pledgor may request the pledgee to exercise the right of pledge promptly after the expiration of the debt performance period;If the pledgee fails to exercise it, the pledgor may request the people's court to auction or sell off the pledged property.

Where the pledgor requests the pledgee to exercise the pledgee's right of pledge in time, if the pledgee is negligent in exercising the right and causes damage, the pledgee shall bear the liability for compensation.

Article 221 after the pledged property is converted into money or auctioned or sold off, the part of the proceeds exceeding the amount of the obligatory right shall be owned by the pledgor; the insufficient part shall be paid off by the obligor.

Article 222 the pledgor and the pledgee may agree to establish a maximum amount of the pledge right.

In addition to applying the relevant provisions of this section, the pledge of maximum amount shall refer to the provisions of section 2 of chapter 16 of this law on mortgage of maximum amount.

Section 2 right pledge

Article 223 the following rights which the obligor or a third party is entitled to dispose of may be pledged:

(1) bills of exchange, cheques and promissory notes;

(2) bonds and certificates of deposit;

(3) warehouse receipt and bill of lading;

(4) fund shares and equity rights that can be transferred;

(5) the right to exclusive use of a registered trademark, patent right, copyright and other intellectual property rights that may be transferred;

(6) accounts receivable;

(7) other property rights that may be pledged under laws and administrative regulations.

Article 224 negotiable bills of exchange, cheques, promissory notes, bonds, certificates of deposit, warehouse receipts or bills of lading, the parties shall conclude a written contract.The pledge right shall be established when the certificate of right is delivered to the pledgee;If there is no certificate of right, the pledge right shall be established when the relevant department goes through the pledge registration.

Article 225 where the cashing date of a bill of exchange, cheque, promissory note, bond, certificate of deposit, warehouse receipt, bill of lading or date of taking delivery of goods is due before the principal creditor's right, the pledgee may cash or take delivery of the goods, and the pledgee may agree with the pledgor to pay off the debt or place in escrow the cashed price or the goods taken in advance.

Article 226 pledge of fund shares or equity shares, the parties shall enter into a written contract.Pledge shall be made from fund shares and equity registered by securities registration and settlement institutions, and the pledge right shall be established when the securities registration and settlement institutions register for pledge;The pledge right shall be established when the administrative department for industry and commerce handles the pledge registration.

After the fund shares and equity are pledged, they shall not be transferred, unless agreed by the pledgor and the pledgee through consultation.The price paid by the pledgor for the transfer of fund shares or equity rights shall be paid off or deposited with the pledgee in advance.

Article 227 where the property right to exclusive use of a registered trademark, patent right, copyright or any other intellectual property right is pledged, the parties shall conclude a written contract.The pledge right shall be established when the competent department handles the pledge registration.

After the property right in the intellectual property right is pledged, the pledgor shall not transfer or permit others to use it, unless agreed by the pledgor and the pledgee through consultation.If the pledgor transfers or permits others to use the property right in the pledged intellectual property right, it shall pay off the debt or deposit in advance to the pledgee.

Article 228 pledge of accounts receivable the parties shall enter into a written contract.The pledge right shall be established when the credit investigation agency handles the pledge registration.Accounts receivable shall not be transferred after pledged, unless agreed upon by the pledgor and the pledgee through negotiation.The pledgor shall pay off the debts or place them in deposit with the pledgee in advance.

Article 229 in addition to the provisions of this section, the provisions of section 1 of this chapter on the pledge of chattel shall apply to the right of pledge.

Chapter xviii liens

Where the obligor fails to perform a debt due, the obligee may retain the chattel of the obligor that is lawfully in its possession, and shall have the right of priority in repayment in respect of the chattel.

The creditor mentioned in the preceding paragraph is the lien holder, and the chattel in possession is the property subject to lien.

Article 231 the chattel subject to lien by a creditor shall be in the same legal relationship as the creditor's right, except where the lien is placed between enterprises.

Article 232 no lien may be placed on a movable property that is not subject to lien as prescribed by law or agreed upon by the parties.

Article 233 where the property subject to lien is divisible, the value of the property subject to lien shall be equivalent to the amount of the debt.

Article 234 the lien holder shall have the obligation to properly keep the property under lien;Where the retained property is damaged or lost due to improper custody, it shall be liable for compensation.

Article 235 the lien holder shall be entitled to collect the fruits of the property under lien.

The fruits mentioned in the preceding paragraph shall first be used to cover the expenses for collecting the fruits.

Article 236 the lien holder and the debtor shall agree on the period of performance of the debt after the lien is placed on the property;Where there is no agreement or the agreement is not clear, the lien holder shall give the debtor more than two months to perform the debt, except for movable property which is not easy to keep, such as fresh and perishable goods.Where the obligor fails to perform within the time limit, the lienor may, through an agreement with the obligor, convert the property under lien into money, or have priority in satisfying the proceeds from the auction or sale of the property under lien.

Where the retained property is converted into money or sold off, the market price shall be referred to.

The obligor may request the lien holder to exercise the lien upon the expiration of the term of performance of the debt;If the lien holder fails to exercise it, the debtor may request the people's court to auction or sell off the property subject to lien.

Article 238 after the property subject to lien is converted into money or auctioned or sold off, the part of the proceeds exceeding the amount of the obligatory right shall be owned by the obligor, and the insufficient part shall be paid off by the obligor.

Article 239 where a mortgage or pledge has been established on the same chattel, and the chattel is subject to a lien, the lien holder shall have priority in the repayment.

Article 240 where the lien holder loses possession of the property subject to lien or the lien holder accepts additional security from the debtor, the lien shall be extinguished.

Part 5 possession

Chapter 19 possession

Article 241 possession arising out of contractual relationship, relating to the use, proceeds from, liability for breach of contract, etc., of a realty or chattel shall be in accordance with the provisions of the contract;Where there is no agreement or the agreement is not clear, the provisions of relevant laws shall apply.

Article 242 if the possessor causes damage to the realty or chattel by using the realty or chattel in his possession, the possessor shall be liable for compensation in bad intent.

Article 243 where a realty or chattel is in the possession of a possessor, the obligee may claim the return of the original object and fruits thereof, but shall pay the necessary expenses incurred by the bona fide possessor in maintaining the realty or chattel.

Article 244 where the owner of a realty or chattel in his possession claims compensation for the damage or loss of the realty or chattel, the possessor shall return to the owner the insurance money, compensation or compensation he has received as a result of the damage or loss;If the damage suffered by the obligee has not been adequately compensated, the malicious possessor shall also compensate for the loss.

Article 245 where a realty or chattel possessed is encroached upon, the possessor shall have the right to request the return of the original object;In the case of an act impairing possession, the possessor shall have the right to request the removal of the nuisance or the elimination of the danger;Where damage is caused by encroachment or obstruction, the possessor shall have the right to claim damages.

Where the possessor fails to exercise his right of claim for the return of the original object within one year from the date of encroachment, such right shall be extinguished.

Attached is

Article 246 before any law or administrative regulation stipulates the scope, registration organ and registration method of the unified registration of immovable property, a local regulation may prescribe in accordance with the relevant provisions of this law.

Article 247 this law shall enter into force as of October 1, 2007.

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