Fa Fa [2020] No.12

The Supreme People’s Court

Circular of the Supreme People’s Court on the Promulgation of the Guiding Opinions of the Supreme People's Court on the Issues of Properly Hearing Civil Cases involving the COVID-19 Pandemic in Accordance with the Law (I)

High people's courts of all provinces, autonomous regions, and municipalities, the Military Court of the People's Liberation Army, and the Xinjiang Production and Construction Corps Branch Court of the High People's Court of Xinjiang Uygur Autonomous Region:

The Guiding Opinions of the Supreme People's Court on the Issues of Properly Hearing Civil Cases involving the COVID-19 Pandemic in Accordance with the Law (I) (“the Opinions”) is hereby promulgated for your conscientious implementation.

Supreme People's Court

April 16, 2020

In order to implement the spirit of the CPC Central Committee’s meeting on the coordination of prevention and control of COVID-19 epidemic and economic and social development, to properly handle civil cases related to COVID-19 epidemic in accordance with the law, to safeguard the legitimate rights and interests of the people, and to maintain social and economic order as well as social fairness and justice, the Supreme People’s Court (“the SPC”) promulgates the following guiding opinions in accordance with the relevant provisions of laws, judicial interpretations and trial experiences.

1. Give full play to the protecting role of judicial service.

The people’s courts at all levels should be fully aware of the major impact of the COVID-19 epidemic on the economy and society, and should give full play to the role of justice in regulating social relationships based on the overall planning of epidemic prevention and control and economic and social development. The people’s courts shall actively participate in the resolution of disputes outside the court, place the alternative dispute resolution mechanism at the front, insist on the priority of mediation, and settle their disputes through negotiation, share risks, and tide over difficulties so that the disputes can be effectively resolved in the bud and at the grassroots level. In hearing civil cases related to the epidemic, people’s courts shall accurately apply the law according to the actual situation of each case, balance the legal rights and interests of the parties, and serve the economic and social development to achieve the unification of legal effect and social effect.

2. Apply accurately the force majeure rule in accordance with the law.

The people’s courts shall accurately apply the specific provisions of force majeure in strict manner when hearing civil cases related to COVID-19 epidemic. For civil disputes arising from the impact of the epidemic or epidemic prevention and control measures, when conditions for force majeure are met, Article 180 of the General Provisions of the Civil Law of the People’s Republic of China and Article 117 and 118 of the Contract Law of the People's Republic of China shall be applied. Where it has been otherwise provided under other laws and administrative regulations, such other provisions shall prevail. The party who claims that the force majeure rule should be applied and the liability should be exempted partly or wholly shall bear the burden of proof to prove the fact that the inability to partly or fully perform its civil obligations is caused by the force majeure event.

3. Handle properly contractual disputes in accordance with the law.

Unless otherwise agreed by the parties, in trying cases of contractual disputes arising from the impact of the epidemic or epidemic prevention and control measures, the people’s courts shall take a comprehensive consideration of the impact of the epidemic on different regions, industries and cases, accurately determine the causation and causative potency between the epidemic or the epidemic prevention and control measures and the inability to perform the contract, and follow these rules:

(a)  When the inability to perform the contract results directly from the epidemic or the epidemic prevention and control measures cause, the force majeure rule shall be applied in accordance with the law to partially or wholly exempt the liabilities to the extent affected by the epidemic or epidemic prevention and control measures. When the inability to perform the contract or the failure to prevent further loss can be attributed to the parties, they should bear the corresponding liabilities in accordance with the law. If a party who fails to perform its contractual obligations due to the epidemic or the epidemic prevention and control measures and claims that it has fulfilled the obligation of timely notification shall bear the corresponding burden of proof.

(b)  When the epidemic or the epidemic prevention and control measures only cause difficulty in performance of the contract, the parties can renegotiate. When it is possible to continue to perform the contract, the people’s courts shall earnestly strengthen mediation and actively guide the parties to continue to perform the contract. A party’s request to terminate the contract on grounds of difficulties in performing the contract will not be supported by the people’s courts. When it is obviously unfair for one party to continue to perform the contract, and that party requests amendments to the terms of contract, such as performance period, performance method, payment amount, etc., the people’s courts shall make a decision on a case-by-case basis. When the purpose of the contract cannot be realized as a result of the epidemic or the epidemic prevention and control measures, the people’s courts will not support the request to terminate the contract.

(c)   If the parties receive subsidies or tax relief from government departments or subsidies or debt relief, from others, etc. due to the epidemic or the epidemic prevention and control measures, the people’s courts may take these factors into consideration of determining whether the contract can be continued.

4. Handle labor dispute cases in accordance with law.

The people’s courts shall strengthen coordination with the government and relevant departments to support employers to adopt flexible working methods in accordance with laws and regulations during the epidemic prevention and control period. In the trial of labor dispute cases related to the epidemic, Article 26 of the Labor Law of People’s Republic of China, Article 40 of the Employment Contract Law of People’s Republic of China and other provisions shall be accurately applied. The people’s courts will not support the employer’s request to terminate the employment relationship merely on the ground that the employee is a confirmed case of COVID-19, a suspected case of COVID-19, an asymptomatic confirmed case of COVID-19, a legally quarantined person or that the employee comes from a region with a relatively severe epidemic. When handling relevant labor dispute cases, the people’s courts shall correctly understand and apply the policies formulated by the relevant administrative departments of the State Council and the provincial people’s governments on proper handling of labor relationships during the period of epidemic prevention and control.

5. Award punitive damages in accordance with law.

For businesses dealing in masks, goggles, protective clothing, disinfectant and other epidemic prevention items, as well as food and medicines, if a situation occurs which falls under either Article 55 of the Law of the People's Republic of China on Protection of the Rights and Interests of the Consumers, Article 148(2) of the Food Safety Law of the People’s Republic of China, Article 144(3) of the Drug Administration Law of the People’s Republic of China and Article 15 of the Provisions of the Supreme People’s Court on Several Issues Concerning the Application of Law in the Trial of Cases Relating to Food and Drug Disputes, the people’s courts shall support consumers’ claims that punitive damages should be awarded.

6. Suspend limitation period in accordance with law.

In cases where an obligee cannot exercise his or her right of claim during the last six months of the limitation period due to the epidemic or epidemic prevention and control measures and the obligee claims for suspension based on Article 194(1)(a) of the General Rules of the Civil Law of the People’s Republic of China, the people’s courts shall allow such suspension.

7. Extend the time limit for litigation in accordance with law.

In cases where the time limit for litigation prescribed by law or designated by the people’s courts has expired due to the epidemic or epidemic prevention and control measures and the party applies for an extension of the time limit in accordance with Article 83 of the Civil Procedure Law of the People’s Republic of China, the people’s courts shall take into consideration the epidemic situation and the evidence provided by the relevant party before determining whether the extension should be granted or not and to protect the party’s litigation rights in accordance with the law. If the concerned party is a confirmed case of COVID-19, a suspected case of COVID-19, an asymptomatic confirmed case of COVID-19, or a related close contact of a confirmed case of COVID-19, and the time limit for litigation expires during the quarantine period, the people’s courts shall grant the extension of time limit for litigation when an application under the above article has been made by the concerned party.

8. Strengthen legal aid.

If a party affected by the epidemic is in actual financial difficulties and applies for exemption, reduction or postponement of payment of litigation fee, the people’s courts shall examine the application according to law and make decisions in a timely manner. For litigation participants in actual need of legal aid, timely measures shall be taken based on the application.

9. Adopt perseveration measures flexibly.

For enterprises, especially micro, small and medium enterprises and individual businesses, that have been in trouble due to the impact of the epidemic, the people’s courts may take a flexible approach to the property preservation measures or methods of property preservation guarantee to effectively reduce the burden on enterprises and help the enterprises to resume work and production.

10. Unify the application of law. 

The people’s courts at all levels should strengthen the guidance and supervision of the trial of civil cases related to the epidemic and give full play to the role of professional judges’ meeting and adjudication committee. Major, difficult and complicated law application issues shall be submitted to the adjudication committee for discussion and decision. The people’s courts at higher levels shall take measures including issuing typical cases to strengthen the guidance on the people’s courts at lower levels to ensure the unification of the rules of adjudication.

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*The original text is Chinese and has been translated into English for reference only. If there is any inconsistency or ambiguity between the Chinese version and the English version, the Chinese version shall prevail.