第二编 物 权
Part II Real Rights
第一分编 通 则
Subpart I General Principles
第一章 一 般 规 定
CHAPTER 1 GENERAL PROVISIONS
Article 205 This Part deals with the civil relations arising from the attribution and utilization of
Article 206 The State upholds and improves the socialist basic economic system, under which
public ownership is dominant and diverse forms of ownership develop side by side, and distribution
according to work remains the dominant form and a variety of other modes of distribution coexist.
The State consolidates and develops the public economy, and encourages, supports and
guides the development of the non-public economy.
The State implements a socialist market economy, and protects equal legal status and
development rights of all market entities.
Article 207 The real rights of the State, collective real rights, private real rights and the real
rights of other rights holders shall be protected equally by the law and shall not be infringed by any
organization or individual.
Article 208 The creation, alteration, alienation or termination of the real right of a real property
shall be subject to registration in accordance with the law. The creation or alienation of the real right
of a movable property shall be delivered in accordance with the law.
Chapter 2 Creation, Alteration, Alienation and Termination of Real Right
Section 1 Registration of Real Property
Article 209 Creation, variation, transfer and extinguishment of real right of real property shall
take effect upon registration pursuant to the law; and shall not take effect without registration, unless
otherwise stipulated by the law.
Registration is not required for natural resources which belong to the State pursuant to the
Article 210 The registration of real property shall be handled by the registration organ of the
place where the real property is located.
The State implements a unified registration system for real property. The scope, authority
and measures for uniform registration shall be specified by the relevant laws and administrative
Article 211 In light of the different registration items, an applicant shall, when applying for
registration, provide such necessary materials as the ownership certificate of the real property and the location and area of the real property, etc.
Article 212 The registrar shall perform the following duties:
1. Examining the ownership certificate and other necessary materials as provided by the
(II) to inquire the applicant about the registration items concerned;
(III) Registering the relevant matters in a faithful and timely manner;
(IV) other duties stipulated by laws and administrative regulations.
Where further proof is required for the relevant information of the real property under
application for registration, the registration authority may require the applicant to provide
supplementary materials, and may conduct onsite inspection where necessary.
Article 213 No registration organ may commit any of the acts as follows:
1. to ask for an evaluation of the real property;
(II) Repeated registration in the name of annual inspection;
(III) Other acts beyond the scope of registration duties.
Article 214 As regards the creation, alteration, alienation or termination of the real right of a
real property, it shall go into effect since the day when it is recorded in the register of real property in
case the registration thereof is required by law.
Article 215 Where a contract is concluded by the related parties concerning the creation,
alteration, alienation or termination of the real right of a real property, the contract shall come into
force upon the conclusion of the contract, unless it is otherwise prescribed by any law; and the
validity of the contract is not affected, whether the real right has been registered or not.
Article 216 The register of real property shall be the basis of ownership and contents of real
The real property register shall be under the management of the registration institution.
Article 217 A real property title deed is the proof of the right holder's entitlement to the real
property rights. The items recorded in the certificate of real property ownership shall conform to
those recorded in the register of real property; except where there is evidence showing that there is
definite error in the register of real property, those recorded in the register of real property shall be
taken as the standard.
Article 218 A rights holder or a stakeholder may apply for enquiry or replication of real
property registration materials, and the registration authorities shall provide the materials.
Article 219 The interested party shall not make public or illegally use the real property
registration materials of the right holder.
Article 220 A rights holder or a stakeholder who is of the opinion that there is an error in the
records of the register of real property may apply for correction of registration. Where the rights
holder recorded in the real property register agrees to make correction in writing or there is evidence
to prove that the registration contains an error, the registration authority shall make the correction.
Where the right holder recorded in the real property register does not agree to the correction,
the interested party may apply for dissidence registration. Where the registration authority grants
dissent registration but the applicant does not file a lawsuit within 15 days from the date of
dissent registration, the dissent registration shall become void. Where the objection registration
is improper and causes the rights holder to suffer damages, the rights holder may seek
compensation for damages from the applicant.
Article 221 Where the related parties have concluded an agreement on the purchase and sale of
houses or an agreement on the real right of any other real property, they may apply to the registration
organ for advance notice registration so as to ensure the realization of the real right in the future.
Without the consent of the right holder in the advance-announcement registration, any disposal of the real property after the advance-announcement registration shall be invalid.
Following pre-registration, where the creditor's rights are extinguished or an application for
registration is not made within 90 days from the date on which real property registration can be
made, the pre-registration shall become void.
Article 222 Where a party concerned provides false materials in an application for registration
and causes others to suffer damages, the party concerned shall bear compensation liability.
In case any registration organ causes damages to any other person by virtue of any mistake
in registration, it shall assume the liability for compensation. The registration authority may,
after making compensation, seek recourse against the person responsible for the error in
Article 223 Real property registration fees shall be charged per unit, and may not be charged on
the basis of the size, volume or price of the real property.
第二节 动 产 交 付
Section 2 Production and Delivery
Article 224 Unless it is otherwise prescribed by any law, the creation or alienation of the real right of a movable property shall come into force upon delivery.
Article 225 The creation, alteration, alienation or termination of the real right of any vessel,
aircraft or motor vehicle and so on may not challenge any bona fide third party if it is not registered.
Article 226 In case a right holder has possessed the movable property prior to the establishment
or alienation of the real right of a movable property, the real right shall come into effect upon the
effectiveness of the civil juristic act.
Article 227 Where a third party has taken possession of a movable property prior to the creation
and transfer of real right of the movable property, the party under an obligation to make delivery may
substitute delivery by transferring the right to require the third party to return the original property.
Article 228 In case both parties agree to let the transferor continuously possess the movable
property when the real rights of a movable property are transferred, the real rights shall go into effect
upon the effectiveness of the agreement.
第三节 其 他 规 定
Section 3 Miscellaneous Provisions
Article 229 In case the creation, alteration, alienation or termination of a real right is resulted
from a legal document of the people's court or an arbitration institution or a requisition decision of
the people's government, etc., the real right shall come into effect upon the effectiveness of the legal
document or the requisition decision.
Article 230 Where real rights are acquired through succession, the real rights take effect upon
the commencement of succession.
Article 231 Where real rights are created or terminated as a result of such factual events as the
legal construction or demolition of houses, the real rights take effect upon the accomplishment of the
Article 232 In case the real right of a real property enjoyed according to the provisions of this
Section is disposed and registration is required according to law, the real right shall have no effect if
it is not registered.
Chapter 3 Protection of Real Right
Article 233 Where real right are infringed, the rights holder may resolve the matter through
settlement, mediation, arbitration, litigation, etc.
Article 234 Where there is a dispute over the ownership and contents of real right, an interested
party may request for a confirmation of rights.
Article 235 Where a person has no right to possess real property or movable property, the rights
holder may request for the return of the original item.
Article 236 Where real rights are under obstruction or may be obstructed, the right holder may
request the removal of the impediment or the elimination of the danger.
Article 237 Where damage is caused to the real property or the movable property, the rights
holder may request for repair, redo, replacement or restoration of the original conditions pursuant to the law.
Article 238 In case the infringement upon a real right causes damages to the right holder, the
right holder may require the compensation for the damages or the assumption of any other civil
liability in accordance with the law.
Article 239 The ways for protecting real right as prescribed in the present Law may apply
either independently or jointly in light of the specific situation of an injury of real right.
第二分编 所 有 权
Subdivision II. Powers
第四章 一 般 规 定
CHAPTER 4 GENERAL PROVISIONS
Article 240 An owner of a real property or movable property shall have the right to possess, use,
benefit and dispose of the real property or movable property pursuant to the law.
Article 241 An owner shall have the right to create usufructuary rights and Security Right over
its own real property or movable property. When exercising the right, the holder of usufructuary
right or Security Right may not infringe upon the rights and interests of the owner.
Article 242 No organization or individual may acquire the ownership of any real property or
movable property that, as provided for by law, is exclusively owned by the State.
Article 243 Collectively-owned land and housing properties and other real property of organizations and individuals may be requisitioned pursuant to the authority and procedures
stipulated by the law for public interest needs.
When requisitioning land owned collectively, it is required to, in accordance with law and
in a timely manner and in full amount, pay land compensation fees, resettlement subsidies and
compensations for rural residential houses and other above-ground fixtures as well as young
crops, arrange for social security fees for the farmers with land requisitioned, guarantee their
livelihood and safeguard their legitimate rights and interests.
If any houses or other real property of organizations and individuals are to be expropriated,
compensation for expropriation shall be made to protect the lawful rights and interests of the
expropriated; and if residential houses of individuals are to be expropriated, the housing
conditions of the expropriated shall be guaranteed.
No organization or individual may embezzle, misappropriate, privately divide, detain or
delay the payment of compensation fees for requisition and other fees.
Article 244 The State shall implement special protection for arable land, strictly restrict
conversion of agricultural land to development land use, and control the total quantity of
development land use. No one may requisition any land owned collectively with violation of the
statutory power limit and procedures.
Article 245 For meeting urgent needs of emergency, disaster relief and epidemic prevention and
control, the real property or movable property of organizations and individuals may be expropriated
in accordance with the authority and procedures prescribed by law. The requisitioned real property or
movable property shall, after its use, be returned to the persons affected by the requisition. Where the real property or movable property of an organization or individual is requisitioned or where it is
damaged or lost after requisition, compensation shall be made.
Chapter 5 State Ownership, Collective Ownership, Private Ownership
Article 246 Property owned by the State as provided by law shall belong to the State, that is, to
the whole people.
The State Council shall exercise the ownership of state-owned property on behalf of the
State. Where the laws provide otherwise, such provisions shall prevail.
Article 247 Mineral deposits, waters and sea areas shall be in the ownership of the state.
Article 248 Uninhabited sea islands shall belong to the State and the State Council shall
exercise the ownership of Uninhabited sea islands on behalf of the State.
Article 249 Urban lands shall be in the ownership of the state. Land in the rural areas and
suburban areas legally owned by the State is owned by the State.
Article 250 Natural resources such as forests, mountains, grasslands, wastelands and tidal flats are owned by the State, except for those owned collectively by law.
Article 251 As regards the wild animal and plant resources that shall be owned by the state as
provisioned by law, they shall be in the ownership of the state.
Article 252 Radio frequency spectrum resources shall be owned by the State.
Article 253 Cultural relics owned by the State as provided by law shall belong to the State.
Article 254 Defense assets are owned by the State.
Infrastructures such as railways, highways, electric power facilities, telecommunication
facilities, and petrol and gas pipelines legally owned by the State are owned by the State.
Article 255 State agencies shall have the right to possess, use and dispose of real property and
movable property under their direct control pursuant to the laws and the relevant provisions of the
Article 256 Institutions established by the State shall have the right to possess, use and,
pursuant to the laws and the relevant provisions of the State Council, benefit and dispose of real property and movable property under their direct control.
Article 257 The State Council and the local people's governments shall, in accordance with the
relevant laws and administrative regulations, perform the contributor's duties and enjoy the rights
and interests on behalf of the State for state-invested enterprises.
Article 258 Property owned by the State shall be protected by law and shall not be occupied,
looted, privately divided, withheld or damaged by any organization or individual.
Article 259 Institutions and their personnel in charge of administration and supervision of
State-owned assets shall strengthen administration and supervision of State-owned assets pursuant to
the law, promote value preservation and value-add of State-owned assets and prevent losses of State-owned assets; legal liability shall be borne pursuant to the law for abuse of official powers and
dereliction of duties which cause losses of State-owned assets.
Whoever, in violation of the provisions on the administration of state-owned property,
causes any loss to state-owned property in the process of enterprise restructuring, merger,
division or related-party transaction by conducting a transfer at a low price, conspiring to divide
up privately, providing a guarantee without authorization or in any other manner shall bear legal
liability in accordance with the law.
Article 260 Collectively-owned real property and movable property include:
1. land, forests, mountains, grasslands, unreclaimed land and beaches owned by collectives
as provided for by law;
(II) Buildings, production facilities, and irrigation and water conservancy facilities that are
(III) Collectively-owned facilities for education, science, culture, public health and sports;
(IV) Other collectively-owned real property and movable property.
Article 261 Real property and movable property collectively-owned by farmers shall be
collectively-owned by members of the collective.
Members of a collective shall decide on the following matters according to statutory
1. The land contracting plan and whether to contract land out to organizations or
individuals that are not part of the collective concerned;
(II) The adjustment of contracted land among the rights holders of the contracted
management of land;
(III) the methods for using and distributing land compensation fees and other expenses;
(IV) The alteration of ownership or any other related issue of an enterprise invested by the
(V) other matters as stipulated by law.
Article 262 With regard to any land, forest, mountain, grassland, wasteland or tidal flat under
collective ownership, the ownership thereof shall be exercised according to the following provisions:
1. Where owned by a rural collective of a village, the village collective economic
organization or the villagers committee shall exercise the ownership on behalf of the collective
according to law;
(II) Where owned by two or more rural collectives, all the collective economic
organizations or villagers groups of the village shall exercise the ownership on behalf of the
collective according to law; and
(III) Where owned by a rural collective of a town, the collective economic organization of
the town shall exercise the ownership on behalf of the collective.
Article 263 As regards any real property or movable property owned by an urban collective, the
urban collective is entitled to possess, use, seek profits from and dispose of it pursuant to the laws
and administrative regulations.
Article 264 The rural collective economic organization, villagers' committee or villagers' group shall, in accordance with the relevant laws, administrative regulations, articles of association and
village regulations and villagers' pledges, publicize the situation of the properties owned by a
collective to the members of the collective. Group members shall have the right to access and make
copies of such materials.
Article 265 Property owned by a collective is protected by law. It is prohibited for any
organization or individual to occupy, fraudulently seize, privately divide or damage such property.
Where the legitimate rights and interests of any member of the collective are infringed upon
by any decision made by a rural collective economic organization, villagers' committee or the
principle thereof, such member may request the people's court to revoke the decision.
Article 266 An individual has the right to own his legal income, premise, articles for daily use,
tools for production, raw materials and other real property and movable property.
Article 267 An individual's legal properties shall be protected by law, any organization or
individual may not encroach, plunder or destroy them.
Article 268 The State, any collective or individual may invest to establish a limited liability
company, a joint stock limited company or any other enterprise in accordance with the law. Where
the State, a collective or an individual invests the real property or movable property owned by it in
an enterprise, the contributor shall, in accordance with the agreement or on the basis of his proportion of investment, enjoy such rights as return on assets, major decisions and selection of
operators and managers and perform his obligations.
Article 269 A profit-making legal person has the right to possess, utilize, profit from and
dispose of its real property and movable property in accordance with the laws, administrative
regulations and its articles of association.
The provisions of the relevant laws, administrative regulations and articles of association
shall apply to rights over real property and movable property of legal persons other than profitmaking legal persons.
Article 270 The real property and movable property lawfully owned by social organizations as
legal persons or legal persons of donation shall be protected by law.
Chapter 6 Owner's Partitioned Ownership of Building
Article 271 An owner is entitled to the ownership of the private areas including residential
premises or premises used for business purposes within a building, and to the common ownership
and management over the common areas other than the private areas.
Article 272 An owner is entitled to possess, use, seek profits from and dispose of the exclusive
parts of the building. No owner may endanger the safety of the building or infringe upon the
legitimate rights and interests of any other owner when exercising his rights.
Article 273 An owner enjoys the rights and assumes the obligations over the common parts
other than the exclusive parts of the building, and may not refuse to perform the obligations on the
ground of waiving the rights.
In case an owner transfers his residential house or house used for business purposes within
the building, the common ownership and management right enjoyed by him/her over the
common parts shall be transferred at the same time.
Article 274 The roads within the building's premises shall be co-owned by the owners, with the
exception of public roads owned by the urban township. Green space within the building's premises
shall be co-owned by the owners, with the exception of public green space owned by the urban
townships or individuals where it is expressly stated. Other public premises, common facilities and
premises used for estate services within the building's premises shall be co-owned by the owners.
Article 275 The ownership of the parking spaces and garages within the building area planned as vehicle parking spaces shall be agreed upon by the related parties in the manners of selling, gifting
or leasing, etc.
The parking places, which occupy the roads or other places commonly owned by all owners,
shall be in the common ownership of all the owners.
Article 276 Parking spaces and garages within the building area planned as vehicle parking
spaces shall first be used to meet the needs of the owners.
Article 277 Owners may establish an owners' group and elect an owners' committee. The
specific conditions and procedures for the establishment of the assembly of property owners and the
committee of property owners shall be subject to the provisions of laws and regulations.
The relevant departments of the local People's Government and residents' committees shall
provide guidance and assistance for establishment of owners' groups and election of owners'
Article 278 The following matters should be decided jointly by the property owners:
1. Formulating and modifying the rules of the owners' congress;
(II) The formulation and revision of the management regulations;
(III) The election or replacement of members of the committee of property owners;
(IV) Selecting and dismissing the realty service enterprise or any other manager;
(V) Using maintenance funds for buildings and auxiliary facilities; and
(VI) To raise funds for maintaining buildings and auxiliary facilities;
(VII) The renovation or reconstruction of buildings and attached facilities; and
(VIII) Changing the use of common parts or conducting operational activities by using
(IX) Other important matters related to common ownership and joint management rights.
Issues to be jointly decided by the owners shall be voted by the owners whose area of
occupied areas constitutes two-thirds or more of the total number of owners who constitute two thirds or more of the total number of owners. A decision on a matter stipulated in item (6) to
item (8) of the preceding paragraph shall require the consent of three-fourths or more of the
owners who voted on the matter and three-fourths or more of the owners who voted on the
matter. A decision on any other matter stipulated in the preceding paragraph shall require the
consent of more than half of the owners who have voted for more than half of the exclusive areas
and more than half of the owners who voted for such matter.
Article 279 Any owner may not alter a residential house into a house used for business
purposes by violating any law, regulation or management stipulation. An owner shall, when
changing a residential house into a house used for business purposes, obtain the unanimous consent
of the interested owners, in addition to observing the laws, regulations and management stipulations.
Article 280 Decisions of the assembly of property owners and the committee of property
owners are legally binding on property owners.
Where a decision of the assembly of property owners or the committee of property owners
harms the legitimate rights and interests of a property owner, said property owner may request
that the people's court nullify the decision.
Article 281 Funds for maintaining a building and the affiliated facilities thereof shall be
commonly owned by the owners of the building. The funds may, upon the codetermination of the
owners, be used for the maintenance, renewal and reconstruction of elevators, roofs, exterior walls,
barrier-free facilities and other common parts. Raising and use of maintenance and repair funds for
buildings and auxiliary facilities shall be announced on a regular basis.
Where there is a need to repair a building and its auxiliary facilities under emergency
circumstances, the owners' group or the owners' committee may apply for use of the repair and
maintenance fund for the building and its auxiliary facilities pursuant to the law.
Article 282 Income derived by a developer, estate services enterprise or any other manager
from utilizing the common area of the owners shall, upon deduction of reasonable costs, belong to the owners.
Article 283 The apportionment of expenses and distribution of gains in respect of a building
and its auxiliary facilities shall be determined pursuant to the agreement where available; where no
agreement exists or the agreement is ambiguous, the apportionment of expenses and distribution of
gains shall be determined pursuant to the ratio of the area occupied exclusively by the owners.
Article 284 The owners of a building may manage the building and affiliated facilities thereof
by themselves or they may entrust a realty service enterprise or any other manager to conduct the
As regards the realty service enterprise or any other manager hired by the construction
entity, the owners are entitled to alter it in accordance with law.
Article 285 The realty service enterprise or any other manager shall, upon the entrustment of
the owners and pursuant to the relevant provisions of Part III of this Law on realty service contracts,
manage the building and affiliated facilities thereof within the building area, accept the supervision
of the owners and make timely replies to the inquiries of the owners about the realty services.
The estate services enterprise or manager shall implement emergency measures and other
management measures implemented by the government pursuant to the law, and actively cooperate in the relevant tasks.
Article 286 Owners shall comply with the laws, regulations and management rules, the relevant
acts shall satisfy the requirements for conservation of resources and protection of ecological
environment. Where the estate services enterprise or manager implements emergency handling
measures and other management measures implemented by the government pursuant to the law, the
owners shall render cooperation pursuant to the law.
As regards any act infringing upon the lawful rights and interests of others, such as
discarding wastes at will, discharging pollutants and noises, breeding animals in violation of the
related provisions, illegally building shelters, occupying passageways or rejecting paying realty
management fees, etc., the owners' congress or the owners' committee has the right, in
accordance with the relevant laws, regulations or management stipulations, to request the actor to
stop the infringing act, remove the impediment, eliminate the danger, restore the house to its
original state or compensate for the losses.
If proprietors or other actors refuse to fulfill their obligations, the concerned parties may
report or complain to the competent administrative department. The competent administrative
department shall handle the case according to law.
Article 287 Where a developer, an estate services enterprise or an estate manager or any other
owner has committed an act which harms its legitimate rights and interests, the owner shall have the right to request that the developer, the estate services enterprise or the manager bears civil liability.
第七章 相 邻 关 系
Chapter 7 Adjacent Relationships
Article 288 A neighboring right holder of a real property shall, in accordance with the
principles of facilitating production and living, solidarity and mutual assistance, fairness and
reasonableness, handle the neighboring relationship properly.
Article 289 In case there exists any provision on the disposal of neighboring relationship in any
law or regulation, such provision shall apply; in the case of no such provision, the neighboring
relationship shall be disposed of in light of the local customs.
Article 290 A right holder of real property shall provide necessary convenience for the
neighboring right holders in terms of the use or drainage of water.
The utilization of natural running water shall be rationally distributed among the
neighboring right holders of the real property. The natural current direction shall be respected
when draining natural running water.
Article 291 A right holder of real property shall provide necessary convenience where a neighboring right holder has to use his land by virtue of passage or for any other reason.
Article 292 Where a right holder of real property has to use a neighboring land or building by
virtue of the construction or repairing of a building, or the laying of wires, cables, water pipes,
heating pipelines or fuel gas pipelines, etc., necessary convenience shall be provided by the right
holder of such land or building.
Article 293 The construction of a building may not violate the relevant engineering
construction standards of the State or obstruct the ventilation, lighting or sunshine of any
Article 294 No right holder of real property may discard solid waste or discharge such harmful
substances as atmospheric pollutants, water pollutants, soil pollutants, noise, light radiation and
electromagnetic radiation in violation of the provisions of the State.
Article 295 An obligee of real property may not, when excavating a land, constructing a
building, laying a pipeline or installing an equipment, endanger the safety of any neighboring real
Article 296 An obligee of real property shall, when utilizing his neighboring real property for
the purpose of using water, drainage, passage or laying pipelines, try his best to avoid causing
damages to the obligee of neighboring real property.
第八章 共 有
Chapter 8 JOINT OWNERSHIP
Article 297. Real property or movable property may be jointly owned by two or more
organizations or individuals. Common ownership includes co-ownership by shares and joint
Article 298 As regards a commonly owned real property or movable property, a several coowner shall, on the basis of his proportion, enjoy the ownership.
Article 299 As regards a commonly owned real property or movable property, a joint owner
shall, on a common basis, enjoy the ownership thereof.
Article 300 Each of the co-owners shall manage the jointly owned real property or movable
property in accordance with the terms of the contract. Where there is no agreement or such
agreement is unclear, each co-owner shall have the right and obligation of management.
Article 301 As regards the disposal of a commonly owned real property or movable property, or
any major repair, change of nature or use of a commonly owned real property or movable property,
unless it is otherwise stipulated between the co-owners, the consent of the several co-owners holding
2/3 shares or all joint owners shall be obtained.
Article 302 As regards the management expenses or any other liabilities of a commonly owned
res, in case there exists any stipulation on these, such stipulation shall apply; in the case of no or
unclear stipulation, the expenses shall be assumed by the several co-owners in accordance with their
respective shares or commonly assumed by all joint owners.
Article 303 Where the co-owners of a co-owned real property or movable property have agreed
not to partition the property so as to maintain the relationship of co-ownership, such agreement shall
apply. However, where any co-owner has certain significant reasons for partitioning the property, he
may request the partition. Where there is no agreement or such agreement is unclear, a divided coowner may request the partition at any time, and a joint co-owner may request the partition when the
basis for co-ownership no longer exists or he has certain significant reasons. In case any damage is
caused to any other person by division, compensation shall be made.
Article 304 The co-owners of a commonly owned realty or chattel may decide on through
negotiation the way of partition. Where no agreement is reached, the jointly owned real property or
movable property may be partitioned without impairing its value, the physical object shall be
partitioned; where it is difficult to partition the physical object or its value would be impaired by the
partition, the proceeds from its discounting, auction or sale shall be partitioned.
Where there is any defect in the real property or movable property obtained from the
partition by the co-owners, the other co-owners shall share the loss.
Article 305 A several co-owner may transfer his share of the commonly owned real property or
share of the movable property. The other co-owners shall have the right of preemption under the
Article 306 Where a divided co-owner transfers his share of a commonly owned real property
or share of movable property, he shall promptly notify the other co-owners of the conditions for
transfer. The other co-owners shall exercise pre-emptive rights within a reasonable period.
If more than two other co-owners exercise the right of first refusal, they shall determine
their respective purchase percentage through consultation; if such consultation fails, they shall
exercise the right of first refusal in proportion to their respective co-ownership shares at the time
Article 307 As regards an obligee's right or a debt generated from a co-owned real property or
movable property, unless it is otherwise prescribed by any law or the third party is aware of the fact
that the co-owner does not have the relationship of joint and several creditor's right or debt, a coowner shall enjoy joint and several creditor's right or undertake joint and several debt in terms of
external relationship. In terms of the internal relationship among the co-owners, unless it is otherwise
stipulated by the co-owners, a divided co-owner shall enjoy the creditor's right or undertake the debt
on the basis of his own share, while a joint co-owner shall enjoy the creditor's right or undertake the
debt on a common basis. Where any several co-owner overpays his share of the debt, he has the right
to recover the overpaid amount from the other co-owners.
Article 308 Where the co-owners of a co-owned real property or movable property have not
agreed on whether the real property or movable property is under divided co-ownership or joint coownership, or such agreement is unclear, unless a family relationship exists between the co-owners,
the real property or movable property shall be deemed as under divided co-ownership.
Article 309 A divided co-owner's share of a commonly owned real property or movable
property shall be determined according to his amount of capital contribution in the case of no or
unclear agreement. Where it is impossible to determine the amount of capital contribution, each
divided co-owner shall enjoy an equal share.
Article 310 Where two or more organizations or individuals jointly hold a usufructuary right or
Security Right, the relevant provisions of this Chapter shall apply by reference.
Chapter 9 Special Provisions Regarding Acquisition of Ownership
Article 311 Where a person without the disposal right of a real property or movable property
transfers the real property or movable property to an assignee, the owner is entitled to recover the
property; unless otherwise provided by law, the assignee shall obtain the ownership of the real
property or movable property under any of the following circumstances:
1. The assignee accepts the real property or movable property in good faith;
(II) Transfer at a reasonable price;
(III) The transferred real property or movable property that is required by law to be
registered has been registered. Those that do not require registration have been delivered to the
Where the transferee has obtained ownership of the real property or movable property
pursuant to the provisions of the preceding paragraph, the original owner shall have the right to
claim for compensation of damages from the transferor with no right of disposal.
In case a related party obtains any other form of real right in good faith, the preceding two
paragraphs shall apply as reference.
Article 312 An owner or any other rights holder shall have the right to recover a lost property.
In case the lost property is possessed by any other person through alienation, the right holder shall
have the right to require the person unauthorized to dispose of the property to compensate for
damages, or, require the assignee to return the original property within two years from the date the
right holder becomes aware of or should have become aware of the assignee. However, where the
assignee purchases the lost property through auction or from a qualified operator, the right holder
shall, when requiring the return of the original property, pay the assignee the amount the assignee
paid for purchasing the property. The claimant, after paying the expenses to the assignee, is entitled
to recover them from the person without disposal rights.
Article 313 After a bona fide assignee obtains the movable property, the original rights on the
movable property shall be terminated. However, the exception is in cases where the bona fide
assignee knew or ought to have known the right at the time of the assignment.
Article 314 A lost-and-found object shall be returned to the right holder. The person finding
such object shall inform the right holder to claim it or hand it over to such related departments as the
public security department in time.
Article 315 Upon receipt of a lost property, where the relevant authorities know the rights
holder, they shall promptly notify the rights holder to collect the property; where the relevant
authorities do not know, they shall promptly make a public announcement on collection of lost property.
Article 316 The person who finds the property shall, prior delivery of the property to the
relevant authorities, safe keep the property with due care; and the relevant authorities shall safe keep
the property with due care prior to collection by the right holder. Civil liability shall be borne where
the lost property is damaged or lost as a result of willful conduct or gross negligence.
Article 317 The right holder of the property, when claiming a lost property, shall pay the finder
or the related department the expenses incurred from the safekeeping of the property.
Where a right holder has offered a reward for finding the property, he shall fulfill his
obligation of granting the reward when claiming the property.
Where the person who finds the object misappropriates the object, he/she shall be deprived
of the right to ask for paying the expenses he/she has paid for safekeeping the object or require
the right holder to perform the obligation as promised.
Article 318 Where a lost-and-found object fails to be claimed within one year as of the date
when the claiming announcement is published, it shall be owned by the state.
Article 319 In case a drift item, an item buried underground or a hidden item is found, the
relevant provisions on the finding of a lost-and-found item shall apply by reference. Where the laws
provide otherwise, such provisions shall prevail.
Article 320 Unless it is otherwise stipulated by the parties concerned, the accessory res shall be
alienated together with the alienation of the principal res.
Article 321 The owner shall be entitled to natural fruits of the property. Where there are both an
owner and a usufructuary right holder, the usufructuary right holder shall be entitled to the natural
fruits of the property. Where the parties agree otherwise, their agreement shall prevail.
In the event of an agreement on statutory fruits, the parties concerned shall obtain statutory
fruits in accordance with the agreement. Where there is no agreement or such agreement is
unclear, statutory fruits shall be obtained in light of trading practices.
Article 322 The ownership of property arising from processing, attachment or mixing shall be
determined according to the agreement where available; where no agreement exists or the agreement
is unclear, the ownership shall be determined in accordance with the law; where the law does not
provide, the ownership shall be determined in accordance with the principles of maximizing the
utility of the property and protecting innocent parties. If one party's fault or the ownership of the
property established has caused damage to the other party, compensation or reimbursement shall be
第三分编 用 益 物 权
Subdivision III. Usufruct Rights
第十章 一 般 规 定
CHAPTER 10 GENERAL PROVISIONS
Article 323 As regards the real property or movable property owned by another person, a
usufructuary right holder is entitled to possess, use and seek proceeds from it.
Article 324 As regards the natural resources that are owned by the state or that are owned by
the state but used by the collective as well as those that are owned by the collective as prescribed by
law, the organizations and individuals may possess, use and seek proceeds from them.
Article 325 Unless the law provides to the contrary, the State implements the system of
compensated use of natural resources.
Article 326 When exercising his rights, a usufructuary right holder shall comply with the
provisions on protecting, reasonably exploiting and utilizing resources and protecting the ecological
environment. The owner shall not interfere with the usufructuary right holder's exercise of rights.
Article 327 Where the usufructuary right is terminated or its exercise is affected due to
expropriation or requisition of real property or movable property, the usufructuary right holder has
the right to obtain corresponding compensations in accordance with Articles 243 and 245 of the present Law.
Article 328 The lawfully obtained right to use sea areas shall be protected by law.
Article 329 The mineral prospecting right, the mining right, the water drawing right and the
right to use water areas or tidal flats for breeding or fishery shall be protected by law.
Chapter 11 Rights to Land Contractual Management
Article 330 The rural collective economic organizations shall apply the dual operation system
characterized by the combination of centralized operation with decentralized operation on the basis
of operation by households under a contract.
As regards the cultivated land, forestland, grassland, and other land for agricultural use that
are owned by farmer collectives as well as those that are owned by the state and used by farmer
collectives, the system of land contractual management shall be adopted.
Article 331 A holder of rights to contractual land operations shall, pursuant to the law, have the
right to possess, use and benefit from arable land, forest land, grassland, etc. under contractual
operations and the right to engage in planting, forestry, husbandry, etc.
Article 332 The term of contract for arable land is 30 years. The contractual term for grassland
shall be 30 to 50 years. The contractual term for forestland shall be 30 up to 70 years.
Upon expiry of the contractual period stipulated in the preceding paragraph, the holder of
rights to contractual land operations may continue contractual operations pursuant to the
provisions of the rural land contract law.
Article 333 Rights to contractual land operations shall be created from the effective date of the
contract for contractual land operations.
The registration authority shall issue the certificate of the right to the contracted
management of land or the certificate of the right to forestland contractual management to the
holder, register it in the register so as to confirm such right.
Article 334 A holder of rights to contractual land operations shall, pursuant to the provisions of
the law, have the right to exchange or transfer the rights to contractual land operations. Without
approval granted according to law, no contracted land may be used for non-agricultural development.
Article 335 In the event of exchange or transfer of land contracted management rights, the
parties concerned may apply to the registration authorities for registration; no claims may be made
against a bona fide third party interest where registration is not processed.
Article 336 The contract-letting party may not readjust the contracted land within the term of a
Where appropriate adjustments need to be made to the contracted arable land or grassland
due to serious damage from natural disasters or other special circumstances, the matter shall be
dealt with pursuant to the provisions of the laws on rural land contract.
Article 337 The contract-letting party may not take back the contracted land within the term of
the contract. Where the laws provide otherwise, such provisions shall prevail.
Article 338 In case a contracted land is expropriated, the holder of the right to the contracted
management of such land has the right to obtain corresponding compensations in accordance with
Article 243 of the present Law.
Article 339 A holder of rights to contractual land operations may, at its own discretion, transfer
its rights to others by way of lease, equity participation or any other method pursuant to the law.
Article 340 A holder of land management rights shall have the right to occupy rural land within
the period stipulated in the contract, carry out agricultural production and operation independently
and derive gains.
Article 341 The right to the management of land under transfer with the term of more than five
years shall be established when the transfer contract comes into effect. The parties concerned may
apply to the registration authority for registration of land management rights; no claims may be made against a bona fide third party interest where registration has not been completed.
Article 342 Where a person enters into a contract for rural land through bid invitation, auction
or public consultation and obtains the ownership certificate after registration according to law, he
may, according to law, circulate his right to land management by means of leasing, buying a stake in, mortgaging or by other means.
Article 343 Where contractual management is implemented over any state-owned agricultural
land, the relevant provisions of this Part shall be referred to.
Chapter 12 Right to Use Construction Land
Article 344 Right to use construction land
The owner of construction land has the right to possess, use and seek proceeds from the land owned by the state, and shall have the right to use the land to construct buildings, fixtures and their auxiliary facilities.
Article 345 The Right to use construction land may be created separately on the surface of or
above or under the land.
Article 346 Right to use construction land shall be created in conformity with the requirements
for saving resources and protecting the ecological environment, in conformity with the provisions on land use in laws and administrative regulations and without prejudice to any established usufructuary rights.
Article 347 The right to use construction land may be created through transfer or allotment, or
by other means.
Public bidding methods such as tender, auction, etc. shall be adopted for assignment of land
use rights for profit-oriented land use such as industrial, commercial, tourism, entertainment and
commercial housing, etc., and land use rights for which there are two or more prospective land
Right to use construction land created by means of allocation shall be strictly restricted.
Article 348 In case the Right to Use Construction Land is created through bid invitation,
auction or agreement, etc., the parties concerned shall conclude a written contract on transfer of the
Right to Use Construction Land.
In general, a contract for the grant of Right to Use Construction Land shall contain the
1. the names and domiciles of the parties concerned;
(II) Boundaries and area, etc. of the land;
(III) space to be occupied by buildings, structures and auxiliary facilities thereof;
(IV) Land use and planning conditions;
(V) Right to use construction land within the prescribed term;
(VI) Payments of transfer fees and other expenses;
(VII) dispute settlement method.
Article 349 For establishing the right to use construction land, an application for registering
such right shall be submitted to the registration organ. Right to use construction land shall be
established upon registration. The registration authority shall issue an ownership certificate to the
holder of the Right to Use Construction Land.
Article 350 The holder of the Right to Use Construction Land shall reasonably use the land and
may not alter the use purpose. In case the purpose of land use needs to be altered, the approval of the
relevant administrative department shall be obtained.
Article 351 The holder of the Right to Use Construction Land shall, according to the legal provisions and the contract, pay transfer fees and other fees.
Article 352 Unless there is evidence to the contrary, the ownership to buildings, structures and
auxiliary facilities constructed by a person who has the Right to use construction land shall belong to
the person who has the Right to use construction land.
Article 353 Unless it is otherwise prescribed by any law, a holder of the Right to Use
Construction Land has the right to transfer, exchange, use as equity contributions, endow or
mortgage the Right to Use Construction Land.
Article 354 Right to use construction land that is transferred, exchanged, contributed as capital,
donated or mortgaged shall be entered into by the parties concerned in writing. The parties may
agree on the contractual time limit, but the time limit shall not exceed the remaining period of the
Right to Use Construction Land.
Article 355 For alienating, exchanging, using as equity contribution, endowing, or mortgaging
the Right to Use Construction Land, an application for alteration registration shall be submitted to
the registration organ.
Article 356 In the event of transfer, exchange, use as equity contribution, endowment, or
mortgage of the Right to Use Construction Land, the buildings, fixtures and affiliated facilities
thereof attached to the land shall be disposed of at the same time.
Article 357 In the event of transfer, exchange, use as equity contribution, endowment, or
mortgage of buildings, constructions and auxiliary facilities thereof, the Right to use construction
land occupied by the buildings, constructions and auxiliary facilities thereof shall be disposed of
Article 358 Where, before the term of the Right to Use Construction Land expires, it is
necessary to recover the land ahead of schedule by virtue of public interests, compensations shall,
according to the provisions of Article 243 of this Law, be given to the houses and other real property
on such land, and corresponding land transfer fees shall be returned back.
Article 359 Right to use construction land for a residential purpose shall be renewed
automatically upon expiration of term. The payment, reduction or exemption of the renewal fee shall
be handled in accordance with the provisions of laws and administrative regulations.
The extension of the term of the right to use construction land for non-residential purpose
upon expiration shall be subject to the provisions of the law. Where there is an agreement on the ownership of houses and other real property on the land, such agreement shall apply; where there is no agreement or such agreement is unclear, the ownership shall be determined in accordance with the provisions of laws and administrative regulations.
Article 360 Right to use construction land that is terminated shall be cancelled registration by
the transferor in a timely manner. The registration authority shall withdraw the ownership certificate.
Article 361 Collectively-owned land used as construction land shall be handled pursuant to the
provisions of land administration laws.
Chapter 13 Right to Use House Sites
Article 362 A holder of rights to use residential land shall have the right to possess and use
collectively-owned land pursuant to the law, and have the right to use the land to construct
residential property and auxiliary facilities.
Article 363 The relevant laws on land administration and the relevant provisions of the State
shall apply to obtaining, exercise and transfer of homestead use rights.
Article 364 The right to use house sites shall be terminated where a house site is terminated by
virtue of any natural disaster, etc. A new residential site shall be allocated to villagers affected by the loss of a residential site in accordance with the law.
Article 365 Change registration or de-registration formalities shall be promptly completed for
any transfer or extinguishment of registered rights to use residential land.
第十四章 居 住 权
Chapter 14 Right of Abode
Article 366 The holder of the right of dwelling shall, according to the stipulations of the
contract, have the usufructuary right to possess and use the dwelling house of others so as to meet the
need of living and dwelling.
Article 367 For the establishment of residence rights, the parties concerned shall enter into a
written residence rights contract.
In general, a residence permit contract shall contain the items as follows:
1. Names or titles and domiciles of the parties;
(II) Location of residence;
(III) the conditions and requirements for residence;
(IV) the term of residence right;
(V) dispute settlement method.
Article 368 Residence rights shall be established without compensation, unless otherwise
agreed by the parties concerned. Those who establish residence rights shall apply to the registration
institutions for registration of residence rights. The residence right shall be established upon
Article 369 The residence right shall not be transferred or inherited. Residential houses with
residential rights created shall not be leased except where the parties agree otherwise.
Article 370 The right of residence shall terminate upon the expiration of its term or upon the
death of the person who has the right of residence. Upon extinguishment of residence rights,
deregistration formalities shall be promptly completed.
Article 371 Where residence rights are established by means of a will, reference shall be made
to the relevant provisions of this Chapter.
第十五章 地 役 权
Chapter 15 SERVITUDE
Article 372 An easement holder shall, according to the contract, be entitled to utilize the real
property of others so as to enhance the efficiency of his own real property.
The real property of another person mentioned in the preceding paragraph is the servient
tenement and one's own real property is the dominant tenement.
Article 373 The parties concerned shall conclude a written contract of easement to create an
In general, an easement contract shall contain the items as follows:
1. Names or titles and domiciles of the parties;
(II) Locations of the servient tenement and dominant tenement;
(III) purpose of use and method;
(IV) Term of easement right;
(V) fees and payment method; and
(VI) dispute settlement method.
Article 374 An easement shall be created from the effective date of a contract for easement.
The parties concerned may apply to the registration authorities for easement registration if they
request for registration; no claims may be made against a bona fide third party interest where an
easement is not registered.
Article 375 The holder of servient tenement shall allow an easement holder to use the real
property pursuant to the contractual provisions, and shall not hinder the easement holder's exercise of rights.
Article 376 An easement holder shall, according to the purpose and method of use as stipulated
in the contract, use the servient tenement, and make efforts to reduce the real right restrictions on the holder of the servient tenement.
Article 377 The easement period shall be agreed between the parties concerned; however, the
easement period shall not exceed the remaining period of usufructuary rights such as land contracted
management rights, right to use construction land, etc.
Article 378 As regards the easement enjoyed or assumed by a land owner, where such
usufructuary rights as the right to the contracted management of land, the right to use house site, etc.
are created, the aforesaid holder of usufructuary right may continuously enjoy or assume the
Article 379 Where any usufructuary right such as the right to the contracted management of
land, the Right to Use Construction Land or the right to use house site has already been established
on the land, the land owner may, without consent of the usufructuary right holder, not establish any
Article 380 An easement may not be solely transferred. Unless it is otherwise stipulated by the
contract, where any such usufruct as the right to the contracted management of land, the right to use
construction land, etc. is alienated, the easement shall be alienated at the same time.
Article 381 An easement may not be solely mortgaged. Where land management rights, Right
to Use Construction Land, etc. are mortgaged, the easement shall be alienated upon the realization of
Article 382 When the dominant tenement as well as the right to the contracted management of
land, the Right to Use Construction Land thereon are partially transferred, the transferee shall enjoy
the easement simultaneously in case the easement is involved in the transferred property.
Article 383 When the servient tenement as well as the right to the contracted management of
land, the Right to Use Construction Land thereon are partially transferred, the easement shall be legally binding upon the transferee if the easement is involved in the transferred property.
Article 384 The holder of the servient tenement has the right to rescind the easement contract,
and the easement shall be terminated, where an easement holder:
1. Abusing easement in violation of the law or the contract; or
(II) as regards the paid use of servient tenement, upon expiration of the stipulated time
limit for payment, failing to pay fees within a reasonable time limit for two times after being
urged to do so.
Article 385 Change registration or de-registration formalities shall be promptly completed for
any change, transfer or extinguishment of a registered easement.
第四分编 担 保 物 权
Subdivision IV. Collateral Rights
第十六章 一 般 规 定
CHAPTER 16 GENERAL PROVISIONS
Article 386 Where the obligor fails to pay its due debts or any circumstance for realizing the
Security Right as stipulated by the parties concerned occurs, the Security Right Holder shall have the priority to seek payments from the secured property, unless otherwise provided by law.
Article 387. In civil activities such as loans and sales, where security is required to ensure the
realization of creditors' rights, the creditor may establish Security Right in accordance with the
provisions of this Law and other laws.
Where a third party provides security to the creditor for a debtor, counter-security from the
debtor may be required. The countersecurity shall be pursuant to the present Law and other
Article 388 For establishing a Security Right, a security contract shall be entered into in
accordance with this Law and other laws. Security contracts shall include mortgage contract, pledge
contract and other contracts with the security function. A security contract shall be a subordinate one
to the principal contract. Unless it is otherwise prescribed by any law, the security contract shall be
invalid if the principal contract is invalid.
. If a security contract is confirmed to be void and the debtor, security provider or creditor
is at fault, he shall bear the corresponding civil liability according to his fault.
Article 389. The security scope of the Security Right includes the principal obligation and its
interest, liquidated damages, compensatory damages, expenses incurred in the custody of the secured
property and the realization of the Security Right. Where the parties agree otherwise, their agreement shall prevail.
Article 390 Where the secured property is damaged, lost or requisitioned during the guarantee
period, the Security Right Holder may seek preferential payments in respect of the insurance money,
damages or indemnities, etc. obtained in relation thereto. If the term for performing the secured
obligee's rights has not expired, such insurance money, damages or indemnities, etc. may be
submitted to a competent authority for keeping.
Article 391 Where a guarantee is provided by a third party and the creditor allows the debtor to
transfer all or part of the debt without the written consent of the guarantor, the guarantor shall no
longer bear the corresponding guarantee liability.
Article 392 Where a secured creditor's right is secured by property and a guarantor, when the
debtor defaults on its debt obligations or where circumstances for the realization of the security right
as agreed by the parties has occurred, the creditor shall realize the creditor's right as agreed. Where
there is no agreement or such agreement is unclear, and the debtor himself provides security in the
form of property, the creditor's right shall be realized first in respect of the property security. Where
the security in the form of property is provided by a third party, the creditor may realize the creditor's
right in respect of the property security or request that the guarantor assume his guarantee liability.
After undertaking the guarantee liability, the third party has the right to seek recourse against the
Article 393 The Security Right shall be extinguished under any of the following circumstances:
1. The principal obligee's rights are terminated;
(II) The Security Right has been realized;
(III) The obligee waives the Security Right; or
(IV) Other circumstances under which the Security Right shall be terminated as provided
for by law.
第十七章 抵 押 权
Chapter 17 Right of Mortgage
Section 1 General Mortgage Right
Article 394 Where an obligor or a third party mortgages his properties to the obligee without
transferring the possession of such properties in order to ensure the payment of debts, if the obligor
fails to pay due debts or any circumstance as stipulated by the parties concerned for realizing the
mortgage right occurs, the obligee has the right to seek preferred payments from such properties.
The debtor or third party referred to in the preceding paragraph shall be the mortgagor; the
creditor shall be the mortgagee and the property provided as a guarantee shall be the mortgaged
Article 395 A mortgage may be established on the following properties of which the obligor
or third party has the right of disposal:
1. Buildings and other objects attached to the land;
(II) Right to use construction land;
(III) right to use sea areas;
(IV) Manufacturing facilities, raw materials, semi-manufactured goods and finished
(V) Buildings, vessels and aircraft under construction; and
(VI) Means of transport;
(VII) Other properties not prohibited from being mortgaged by any law or administrative
A mortgagor may mortgage all the properties listed in the preceding paragraph together.
Article 396 An enterprise, individual industrial and commercial household or agricultural
production operator may mortgage any existing production equipment, raw materials, semi-finished
products and products thereof or those to be owned in future, and where the obligor fails to pay
its/his due debts or any circumstance as stipulated by the parties concerned for realizing the
mortgage right happens, the obligee has the right to seek preferred payments from the movable
property at the time when the mortgaged property is determined.
Article 397 Where a building is mortgaged, the Right to use construction land as possessed by
the building shall be mortgaged together with the building. Right to use construction land that is
mortgaged shall be mortgaged together with the buildings on the land.
Where a mortgagor fails to mortgage the properties in accordance with the provisions in the
preceding paragraph, the properties not mortgaged shall be deemed to be mortgaged together.
Article 398 Right to use construction land of a township or village enterprise may not be
mortgaged separately. Where a building such as factory of a township or village enterprise is
mortgaged, the Right to use construction land within the area of such building shall be mortgaged
Article 399 The following property may not be mortgaged:
1. the ownership of land;
(II) the right to use such collectively-owned land as homestead, land and hills allotted for
private use, except for those that may be mortgaged as prescribed by any law; and
(III) educational, medical and other public welfare facilities of non-profit legal persons
established for the purpose of public welfare by schools, kindergartens, medical institutions, etc.;
(IV) properties with unclear or controversial ownership or use rights;
(V) properties legally sealed up, seized or under supervision; or
(VI) other properties that cannot be mortgaged as prescribed by any law or administrative
Article 400 For establishing a mortgage right, the parties concerned shall enter into a written
In general, a mortgage contract shall contain the items as follows:
1. the variety and amount of the secured obligee's rights;
(II) The time limit for the obligor to fulfill obligations;
(III) The name and quantity of mortgaged property;
(IV) The scope of guarantee.
Article 401 Where, before the expiration of the time limit for paying debts, the mortgagee and
the mortgagor stipulate that the ownership of the mortgaged property shall be attributed to the
obligee when the obligor fails to pay due debts, the mortgagee may only have priority in getting compensation from the mortgaged property.
Article 402 Where any of the property stipulated in item (1) to item (3) of the first paragraph of
Article 395 or a building under construction as stipulated in item (5) is mortgaged, mortgage
registration formalities shall be completed. Mortgage interests shall be created at the time of
Article 403 For a mortgage on movable property, the mortgage right shall be established as of
the date the mortgage contract comes into effect. If the mortgage is not registered, the parties
concerned may not challenge any bona fide third party.
Article 404. The mortgage of movable property may not be used against a buyer who, in the
ordinary course of business, has already paid a reasonable price and obtained the mortgaged property.
Article 405 Where the mortgaged property has been leased and transferred for occupation prior
to the establishment of the mortgage right, the original leasehold relation shall not be affected by
such mortgage right.
Article 406 The mortgagor may transfer the mortgaged property during the mortgage term.
Where the parties agree otherwise, their agreement shall prevail. Where mortgaged property is transferred, the mortgage rights shall not be affected.
Where a mortgagor assigns the mortgaged property, he shall timely notify the mortgagee. If
the mortgagee can prove that the mortgage right may be damaged by the transfer of the
mortgaged property, he may require the mortgagor to pay off the debt in advance with the money
obtained from such transfer or submit it to a competent authority for safekeeping. The value
exceeding the obligee's rights shall be attributed to the mortgagor, and the gap shall be paid off
by the obligor.
Article 407 Mortgage interests may not be transferred independently from the creditor's rights
or used to secure other creditors' rights. Unless it is otherwise prescribed by any law or is otherwise
stipulated by the parties concerned, when the obligee's rights are alienated, the mortgage right
thereof shall be alienated concurrently.
Article 408 Where any act of a mortgagor is sufficient to cause a reduction in value of the
mortgaged property, the mortgagee shall have the right to require the mortgagor to cease such act;
where the value of the mortgaged property is reduced, the mortgagee shall have the right to require
the mortgagor to restore the value of the mortgaged property, or provide security equivalent to the
reduced value. Where the mortgagor neither recovers the value nor provides any security, the
mortgagee has the right to request the obligor to pay off the debts in advance.
Article 409. A mortgagee may abandon the mortgage rights or the order in respect of mortgage
rights. A mortgagee and a mortgagor may, through negotiations, alter the sequence of receiving
compensation in respect of mortgage rights or the amount of secured obligee's rights, etc. However, a
change of mortgage rights which has not been consented to in writing by the other mortgagees shall
not adversely affect such other mortgagees.
Where an obligor mortgages his own properties, and the mortgagee abandons the mortgage
rights, the sequence thereof or alter the mortgage rights, the other guarantors shall be exempted
from the guarantee liability, to the extent that the mortgagee has lost the right to seek preferred
payments of compensation, unless any other guarantors undertake to continue to provide the
Article 410 When the obligor fails to pay its/his due debts or any circumstance as stipulated by
the parties concerned for realizing the mortgage right arises, the mortgagee may, upon negotiation
with the mortgagor, convert the mortgaged property into money or seek preferred payments from the
money generated from the auction or sale of the mortgaged property. Where the agreement has
harmed the interests of other creditors, the other creditors may apply to a People's Court for
revocation of the agreement.
Where no agreement on the means of realizing the mortgage right is reached by the
mortgagee and the mortgagor, the mortgagee may require the people's court to auction or sell off
the mortgaged property.
When cashing or selling the mortgaged property, its market price shall be referred to.
Article 411 As regards the mortgage created in accordance with Article 396 of the present
Law, the mortgaged property shall be determined when any of the following circumstances arises:
1. Upon expiration of the time limit for paying debts, the obligee's rights have not been
(II) The mortgagor is declared bankrupt or dissolved;
(III) Other circumstances as stipulated by the parties concerned for realizing the mortgage
(IV) Any other circumstance seriously impacting the realization of obligee's rights.
Article 412 When the obligor fails to pay its/his due debts or any circumstance as stipulated by
the parties concerned for realizing the mortgage right arises, and as a result of which the mortgaged
property is seized by the people's court in accordance with the law, the mortgagee has the right to
collect natural or statutory fruits of the mortgaged property as of the date of seizure, unless the
mortgagee fails to notify the obligor for statutory fruits that it/he shall pay off statutory fruits.
The "fruits" as referred to in the preceding paragraph shall be firstly used for paying the
expenses for collecting the fruits.
Article 413 Any proceeds from the discount, auction or sale of mortgaged property in excess of
the amount of the obligation shall belong to the mortgagor and any shortfall shall be borne by the
Article 414 Where a property is mortgaged to two or more creditors, the proceeds from the
auction or sale of the mortgaged property shall be applied to paying debts in accordance with the
1. where the mortgage rights have been registered, the repayment order shall be determined
in light of the order of registration; and
(II) The registered mortgage rights shall have priority over the unregistered ones for
(III) Where no mortgage rights are registered, the payments shall be made on the basis of
the proportion of obligee’s rights.
Other Security Right that may be registered, The provisions of the preceding paragraph
shall apply mutatis mutandis to the order of repayment.
Article 415 Where both a mortgage and a pledge are created on the same property, the
sequence of repayment from the proceeds of the auction or sale of such property shall be determined
according to the time of registration and delivery.
Article 416 Where the principal obligation secured by a mortgage on movable property is the
price of the mortgaged property and mortgage registration formalities are completed within 10 days
after the delivery of the subject matter, the mortgagee shall have priority over other security right
holders in the buyer of the mortgaged property in receiving payment, except for the lienor.
Article 417 Buildings newly constructed on the land after the mortgage of the Right to Use
Construction Land shall not belong to the mortgaged property. When the mortgage right is realized
on the Right to Use Construction Land, any newly constructed building on such land shall be
disposed together with the Right to Use Construction Land. However, the mortgagee has no right to
be paid in priority with the money obtained from the newly added buildings.
Article 418. Where collectively owned land use rights are mortgaged in accordance with the
law, following the realization of mortgage rights the nature of the land ownership rights and the
purpose of the land use must not be altered without undergoing the statutory procedures.
Article 419 A mortgagee shall, within the limitation of action for the principal obligee's rights,
exercise the mortgage right, otherwise, such mortgage right will not be protected by the people's
Section 2 Mortgage Right at Maximum Amount
Article 420 Where an obligor or third party, for the purpose of guaranteeing the payment
of debts, provides mortgaged properties for the obligee's rights that will continuously happen
within a certain term, and the obligor fails to pay its/his due debts or any circumstance as
stipulated by the parties concerned for realizing the mortgage right happens, the mortgagee
has the right to seek preferred payments from the secured properties within the maximum
amount of obligee's rights.
The obligee's rights existing prior to the establishment of the mortgage right at maximum
amount may, upon the consent of the parties concerned, be incorporated into the scope of
obligee's rights under the mortgage security at maximum amount.
Article 421 Where part of an obligee's rights are transferred prior to the establishment of the
maximum amount of mortgage security, the maximum amount of mortgage rights may not be
transferred unless otherwise stipulated by the parties concerned.
Article 422 A mortgagee and a mortgagor may, by agreement, alter the period of confirmation,
the scope and maximum amount of creditors' rights before the creditors' rights secured by maximum
amount of mortgage interests are confirmed. However, the content of the change shall not have
adverse effect on other mortgagees.
Article 423 The obligee's rights of a mortgagee shall be confirmed under any of the following
1. The stipulated term for the confirmation of the obligee’s rights expires;
(II) Where there is no agreement on the confirmation period or such agreement is unclear,
the mortgagee or the mortgagor may require confirmation of the obligee’s rights after two years
from the date the maximum amount of mortgage rights is created;
(III) The new creditor's right cannot arise; or
(IV) Where the mortgagee knows or should know that the mortgaged property is sealed up
(V) The obligor or the mortgagor is declared bankrupt or is dissolved; or
(VI) Any other circumstance as prescribed by any law for determining the obligee’s rights
Article 424 The mortgage right at maximum amount shall be governed by, in addition to the
provisions in this Section, the relevant provisions in Section 1 of this Chapter.
第十八章 质 权
Chapter 18 Pledge Right
第一节 动 产 质 权
Section 1 Movable Property Right
Article 425 Where an obligor or a third party pledges his/its movable property to an obligee for
guaranteeing the payment of debts, if the obligor fails to pay due debts or any circumstance for
realizing the pledge right as stipulated by the parties concerned occurs, the obligee has the right to
seek preferred payments from the movable property.
The debtor or third party referred to in the preceding paragraph shall be the pledgor; the
creditor shall be the pledgee and the delivered movable property shall be the pledged property.
Article 426 Movable property which is prohibited by laws and administrative regulations from
being pledged may not be pledged.
Article 427 For establishing the pledge right, the parties concerned shall enter into a written
In general, a pledge contract shall contain the items as follows:
1. the variety and amount of the secured obligee's rights;
(II) The time limit for the obligor to fulfill obligations;
(III) The name and quantity, etc. of the pledged properties;
(IV) the scope of guarantee; and
(V) The time and way of delivery of the pledged properties.
Article 428 Where, prior to the expiration of the term for paying debts, the pledgee and the
pledgor stipulate that the ownership of pledged properties shall be attributed to the obligee when the
obligor fails to pay due debts, the pledgee shall have priority in receiving payment from the pledged
Article 429 The pledge right shall be established after the pledgee has delivered the pledged
Article 430 Unless it is otherwise stipulated in the contract, a pledgee has the right to obtain the
fruits of the pledged properties.
The "fruits" as referred to in the preceding paragraph shall be firstly used for paying the
expenses for collecting the fruits.
Article 431 Where a pledgee, without consent of the pledger, illegally uses or disposes of the
pledged properties within the duration of the pledge right, and thus damages are caused to the
pledger, he/it shall make compensations.
Article 432 A pledgee shall be obliged to properly keep pledged properties; and where pledged
properties are damaged or lost by virtue of improper safekeeping, the pledgee shall make
Where pledged properties may be damaged or lost by act of the pledgee, the pledger may
ask for the pledgee to submit them to a competent authority for keeping or require pay debts in
advance and take back them.
Article 433 Where any cause not attributable to the pledgee's fault may result in the destruction
of the pledged properties or an obvious decrease of the value of the pledged properties, and which is
sufficient to damage the pledgee's rights, the pledgee has the right to require the pledger to provide
corresponding security. If the pledger fails to do so, the pledgee may auction or sell off the pledged
properties, and may, upon negotiation with the pledger, seek preferred payments for the obligee's
rights in advance with the money generated from such auction or sell-off, or submit the said money
to a competent authority for keeping.
Article 434 Where a pledgee transfers, without consent of the pledgor, the pledge within the
duration of the pledge right, thus causing damage or loss to the pledged properties, he/it shall make
Article 435 A pledgee may abandon the pledge right. Where an obligor provide the pledge right
by his/its own properties, and the pledgee abandons the pledge right, unless any of other security
providers promises to provide the security all the same, other security providers’ security liability
will be exempted within the scope for which the pledgee has lost the right to seek preferred payments.
Article 436 Where the obligor has paid off the debts or the pledger has fulfilled the secured
obligee's rights in advance, the pledgee shall return the pledged properties.
Where the debtor defaults on its debt obligations or where circumstances for the realization
of the pledge interest as agreed by the parties has occurred, the pledgee may, by agreement with
the pledgor, claim the proceeds from a discount, auction or sale of the pledged property in
priority, in satisfaction of its claim.
When cashing or selling the pledged properties, their market price shall be referred to.
Article 437 A pledgor may, upon expiration of the time limit for paying debts, request the
pledgee to exercise the pledge right in a timely manner. If the pledgee fails to do so, the pledgor may
request the people's court to auction or sell off the pledged properties.
Pledgor shall indemnify Pledgee for any damage suffered by Pledgor as a result of
Pledgee’s indolence in exercising the Pledge.
Article 438 Any proceeds from the discount, auction or sale of pledged property in excess of
the amount of debt secured shall belong to the pledgor and any shortfall shall be borne by the debtor.
Article 439 The pledgor and the pledgee may, upon negotiation, agree on the maximum
amount of pledge rights.
The provisions of Section 2 of Chapter 17 of this Part shall apply as reference to maximum
amount of pledge rights, in addition to the relevant provisions of this Section.
第二节 权 利 质 权
Section 2 Right to Pledge
Article 440 The following rights of which an obligor or third party has the right of disposal
may be pledged:
(1) bills of exchange, promissory notes and checks;
(II) Bonds and deposit receipts;
(III) warehouse receipts and bills of lading;
(IV) transferable fund units and stock rights;
(V) such transferable property rights in intellectual property as exclusive trademark rights,
patent rights, copyrights, etc.;
(VI) Receivables existing and to be existing;
(VII) Other property rights that can be pledged as prescribed by any law or administrative
Article 441 Where a pledge is made on bills of exchange, promissory notes, cheques, bonds,
certificates of deposit, warehouse receipts or bills of lading, the pledge rights shall be established
upon the delivery of documents of title to the pledgee. Where there is no document of title, the
pledge rights shall be established upon the registration of the pledge. Where the laws provide
otherwise, such provisions shall prevail.
Article 442 Where the date of redemption or collection of the draft, promissory note, check,
bond, certificate of deposit, warehouse receipt or bill of lading is prior to the due date of the principal
obligee's rights, the pledgee may redeem or collect the goods, and may, upon negotiation with the
pledgor, seek early payments with the redeemed money or the collected goods, or submit the said
money or goods to a competent authority for keeping.
Article 443 As regards the pledge of fund units or stock rights, the pledge right shall be
established as of the date the pledge registration is handled.
Pledged fund units and equity may not be transferred unless the pledgor and the pledgee
negotiated and agreed to the contrary. The pledgor shall apply the proceeds received from a transfer of fund units and equity to discharge the debt with the pledgee in advance or deposit the
Article 444 Pledge of property rights in intellectual property such as exclusive rights to use
registered trademarks, patent rights, copyrights, etc., shall be created at the time of registration of the
After the property rights in the intellectual property have been pledged, unless it is
otherwise agreed to between the pledger and the pledgee upon negotiations, the pledger may not
alienate the pledge or permit anyone else to use it. The pledgor shall apply the proceeds received
from a transfer or license of the pledged intellectual property to discharge the debt with the
pledgee in advance or deposit the amount.
Article 445 As regards the pledge of accounts receivable, the pledge right shall be established
as of the date the pledge registration is handled.
After the receivables have been pledged, unless it is otherwise agreed on by the pledger and
the pledgee upon negotiations, the pledger may not alienate the pledged receivables. The pledgor
shall apply the proceeds received from a transfer of accounts receivable to discharge the debt
with the pledgee in advance or deposit the amount.
Article 446 The pledge of rights shall be governed by, in addition to the provisions prescribed
in this Section, the relevant provisions in Section 1 of this Chapter.
第十九章 留 置 权
Chapter 19: Lien
Article 447 Where an obligor fails to pay off its due debts, the obligee may take lien of the
movable property that is lawfully possessed by the obligor, and has the right to seek preferred
payments from such movable property.
The "obligee" as referred to in the preceding Paragraph shall be the lienor, and the occupied
movable property shall be the property under lien.
Article 448 The movable property under lien of the obligee and the obligee's rights shall fall
into a same legal relationship, except for the lien between enterprises.
Article 449 Where movable property is prohibited by law or by agreement between the parties
from being subject to a lien, such property may not be subject to a lien.
Article 450 Where a property under lien is a divisible object, its value shall be equal to the number of debts.
Article 451 A lienor shall assume the obligation to properly keep the property under lien, and
shall make compensations in case the property under lien is damaged or lost by virtue of improper safekeeping.
Article 452 A lienor shall be entitled to the fruits generated from the property under lien.
The "fruits" as referred to in the preceding paragraph shall be firstly used for paying the
expenses for collecting the fruits.
Article 453 A lienor shall, after a property is taken as lien, stipulate with the obligor the time
limit for the fulfillment of the obligee's rights. Where there is no such stipulation or the stipulation is
not clear, the lienor shall grant the obligor a time limit of 60 days or more for the fulfillment of the
obligee's rights, except for such movable property that is not easy to be kept as fresh goods,
perishable goods, etc. Where the debtor defaults on the debt obligations within the stipulated period,
the lienor may, by agreement with the debtor, claim the proceeds from a discount, auction or sale of
the lien property in priority, in satisfaction of its claim.
Reference shall be made to the market price for any discounting or sale of lien property.
Article 454 An obligor may, upon expiration of the time limit for fulfilling the obligee's rights,
request the lienor to exercise the lien; and where the lienor fails to do so, the obligor may request the
People's Court to sell or auction the property under lien.
Article 455 Any excess of the proceeds of the cashing, auction or sale of the property under
lien over the amount of the obligee's rights shall belong to the obligor, and any shortfall shall be
settled by the obligor.
Article 456 Where a mortgage or pledge is created on the same movable property, and the said
movable property is taken as lien, the lienor has the right to seek preferential payments.
Article 457 The lien shall perish in case a lienor losses the possession of the property under
lien or accepts other security separately provided by the obligor.
第五分编 占 有
Occupation of Subpart V
第二十章 占 有
Chapter 20 Possession
Article 458 Where possession arises out of a contractual relationship, the use, benefit and
liability for breach of contract of the relevant real property or movable property shall be subject to
the contractual provisions; where the contract is silent or the provisions are unclear, the relevant legal
provisions shall apply.
Article 459 Where a possessor causes any damage to the real property or movable property
under his possession during use, the possessor shall make compensations if he is malicious.
Article 460 Where a real property or movable property is possessed by the possessor, the right
holder may request the possessor to return the original property and any gains therefrom. However,
the right holder shall pay the bona fide possessor necessary expenses incurred in the maintenance of the real property or movable property.
Article 461 Where any real property or movable property under possession is damaged or lost,
the possessor shall return the insurance money, damages or indemnities for the said damage or loss
to the obligee if the obligee requires compensations. A malicious possessor shall make
compensations in case the damages to the obligee have not been sufficiently made up.
Article 462 Where a real property or movable property under possession is encroached upon,
the possessor has the right to request the return of the original property. Where any act impairs the
possession, the possessor has the right to request the cessation of impairment or danger; where any
damage is caused by virtue of encroachment or interference, the possessor has the right to request
compensation in accordance with law.
The claim of a possessor for returning the original object shall perish, if the possessor fails to exercise it within one year as of the date of encroachment.