Siyi Lin is currently a lawyer at King & Wood Mallesons. Her practice mainly focuses on M&A, foreign direct investment, private equity and venture capital.
She holds an LLB degree from China University of Political Science and Law (2014), an LLM in Chinese Business Law and PhD degree from the Chinese University of Hong Kong (respectively 2015 and 2019). Dr. Lin’s major research interests are unjust enrichment, trust law, Chinese contract law and tort law. She has published several in-depth research articles in international law journals.
Exceptions to pacta sunt servanda in the Chinese Civil Code
The principle of pacta sunt servanda requires parties to contracts to meet their contractual obligations, which constitutes one basic principle in Chinese contract law. However, to comply with the principle of good faith and fairness, exceptions to the strict application of the pacta principle should be allowed if circumstances existing at the time of contracting and forming the basis of the contracts have changed fundamentally. Chinese contract law provides two such exceptions, force majeure and change of circumstances, which play a more important role against the backdrop of coronavirus and have triggered heated discussion worldwide. This article intends to examine how these two exceptions have been formulated in the Chinese Civil Code and operate in the commercial world and aims at providing a comprehensive assessment in terms of whether they are workable both in age of coronavirus and in other contexts.