Contract Risk Prevention Program-World Credit Organization

Contract risk prevention plan (full version in 2008, revised on April 13, 2012)

Table of Contents

Section 1 Examining the other party’s true identity, honesty and willingness to perform the contract

Section 2 Ensuring that the contract signing form is appropriate and the important terms are complete

Section 3 Review whether the method and content of contract conclusion are legal

Section 4 Agreement on Credit Supervision Clause (CS Clause)

Section 5 Agreeing on Dispute Jurisdiction and Applicable Law

Section 6 Clearly indicate the place where the contract is signed

Section 7 If necessary and possible, agree to a breach of contract

Section 8 If necessary and possible, agree on a retention of title clause

Section 9 If necessary and possible, agree on guarantee terms

Contract risk is the main external risk faced by enterprises. Now there are many cases of contract fraud, and most contract fraud is regarded as economic disputes, so that the scammers get away with it, and the scammers will often design bigger scams when they have strength. Regarding how to sign a contract correctly, different situations naturally have different requirements. The World Credit Organization (WCO) (formerly the International Credit Assessment and Supervisory Association [ICASA]) has summarized nine generally applicable precautions as a contract risk prevention plan for people's reference. In 2008, we revised and improved the nine points for attention. The content of this chapter is excerpted from: "Building an Integrity Unit——Risk Control and Integrity Management" (by Fang Bangjian)

Section 1 Examining the other party’s true identity, honesty and ability to perform the contract

Before signing a contract, the other party's true identity, honesty and willingness to perform the contract should be carefully reviewed.

1. Is the registration certificate of the party concerned legal and authentic?

Audit method:

(1) Ask the parties to provide the ICE8000 credit identity certificate before going to the ICE8000 credit search Check authenticity and credit history.

The credit card is interpreted as follows:

1. The credibility of the original certificate is divided into: possible, relatively credible, and credible. The meaning is as follows:

(1) The standard for the credibility of the original certificate is [possible]: the ICE8000 credit agency has performed the investigation procedure on the original certificate, but due to objective reasons, after the investigation procedure is over, it cannot be verified or falsified. The meaning of credibility as [maybe] is: it may be true or it may be false.

(2) The meaning of the credibility of the original certificate being [more credible] is: the international credit practitioners appointed by the ICE8000 credit agency have verified the authenticity of the original certificate, but because there is no face-to-face signing and face-to-face verification, there are applicants fraudulent. Possibility to apply for a credit card with real documents of others.

(3) The meaning of the credibility of the original certificate being [credible] is:

A. The signature and seal of the applicant's application materials are all signed in person in the presence of international credit practitioners.

B. The applicant directly submits the original certificate to the ICE8000 credit agency in person, and the international credit practitioners assigned by the ICE8000 credit agency check the original certificate and the applicant face to face.

C. International credit practitioners have verified the authenticity of the original documents.

2 Interpretation of Integrity Level

(1) If the integrity level has a + sign, it means that it has a record of being praised in the past 12 months.

(2) If the integrity level is marked with -. Indicates that there has been a record of complaints within the past 12 months.

(3) If it is a category A level, it shows that he has not made reservations about punitive damages, the cost of breaking his promise is high, and his willingness to be honest is high. If he cheats you of 100 yuan, he should bear 200 yuan or more in multiples of compensation. If it is Class B, he will only compensate for direct losses for his dishonesty.

3, Interpretation of Integrity Points

The higher the integrity score, the more praises received. If there are penalty points deducted, it means that it has been complained about.

(2) If the party does not have a ICE8000 credit ID card, check its ICE8000 credit file.

If the party does not have an ICE8000 credit ID card, since the ICE8000 credit file can help you understand and monitor the customer's credit performance, you can ask for the ICE8000 credit code (Note: Since 2004, the World Credit Organization (WCO) has provided ICE8000 credit codes for 70% of China Enterprises have established ICE8000 credit investigation credit files and assigned ICE8000 credit codes. People can ask credit sales applicants for their ICE8000 credit codes to accurately inquire about their credit files and credit records), and then check their credit files to see if there is a warning sexual credit history. If the customer does not have a credit file, a credit file can be established for free to collect their credit history and monitor their credit performance. After establishing a credit file for the other party, you can notify the other party and inform them of their credit code. For customers with impure motives, the ICE8000 credit file will bring certain pressure to them in the future.

(3) If the party does not haveICE8000 credit ID card, check his industrial and commercial registration file.

If the party does not have an ICE8000 credit ID card, he can log on to the website of the industrial and commercial bureau where the unit belongs to inquire. Many domestic industrial and commercial bureaus have begun to disclose the registration information of the unit on the Internet in accordance with the relevant provisions of the "Government Information Disclosure Regulations" and the "Administrative Licensing Law". For individuals, you can also log on to the Citizen Identity Information Verification Network of the Ministry of Public Security to verify your ID card information. It is worth noting that some professional scammers use fake ID cards or borrow ID cards to register companies. Although the business license is real, the legal representative is fake. Therefore, it is necessary to verify the identity of the legal representative.

Second, whether the identity of the legal representative, the identity of the signatory, and the identity of the person in charge are true

Verifying the identity of the signatory or handler will of course increase the insurance factor of the contract. Because after the untrustworthy behavior occurs, although the signatory and the handler may not actually bear the legal responsibility, they will certainly bear part of the credit responsibility. Audit method:

1. Relevant personnel are required to issue ICE8000 personal credit ID card and verification password, and then verify the authenticity of the certificate through ICE8000 credit search. Since the personal credit ID card has a photo, there are also photos in the certificate verification column, and the identity of the individual has been established Certificates and/or academic certificates have been verified by the ICE8000 credit agency, so the authenticity of the identity can be guaranteed;

2. If you do not have a credit ID card, you can ask him to show a copy of his ID card, and then verify it through the website of the Citizen Identity Information Verification Center of the Ministry of Public Security.

Third, whether the parties are qualified to sign the contract

The review methods are:

1. If the party concerned is a natural person, check whether he has full capacity for civil conduct

Natural persons have full capacity for civil conduct when they reach the age of 18. A natural person or mental patient under the age of 10 has no capacity for civil conduct and is not eligible to sign a contract. 10 to 18 years old or interval mental patients are persons with limited capacity for civil conduct.

A contract concluded by a person with limited capacity for civil conduct is invalid if it is not ratified by a legal representative, but a contract purely for profit or a contract concluded in accordance with his age, intelligence, or mental health does not need to be ratified by a legal representative.

The counterparty can urge the legal representative to ratify within one month. If the legal representative fails to make a statement, it shall be deemed as a refusal to ratify. Before the contract is ratified, the bona fide counterparty has the right to rescind it. The withdrawal shall be made by means of notice.

2. Review the official seal of the contract and the identity of the signatory

If the official seal of the other party is the official seal of a branch of a legal person or an internal institution, it should be required to provide a letter of authorization from the legal person institution or related documents. Signing the official seal on the contract by the other party does not guarantee that the contract is valid. It must also ensure that the signatory of the contract is the legal representative of the other party or a person authorized by the legal representative. Although most of the time, contracts that are only affixed with the official seal of the unit but without the signature of the legal representative (or the legal representative's authorized person) are considered valid, there are many cases where similar contracts have been ruled invalid. Therefore, it is necessary to require both the official seal and the signature of the legal representative or the person in charge authorized by the legal representative on the contract.

If the other party's signatory is the legal representative of the enterprise, before signing the contract, the other party should be required to provide the legal representative's identity certificate and a copy of the business license or ICE8000Credit ID card; if the other party is only the business personnel of the enterprise, they should also provide the power of attorney of the enterprise and its legal representative, the business personnel's own identity certificate or ICE8000 credit ID card and other relevant certification documents.

3. Check whether the party has the right of agency

If the contract is made by an agent, it should be examined whether the agent has agency authority or exceeds agency authority or is terminated by agency authority. A contract concluded in the name of the principal after exceeding the power of agency or after the power of agency has terminated shall not be effective against the principal without ratification by the principal, and the actor shall bear the responsibility.

The counterparty can urge the principal to ratify within one month. If the principal fails to make a statement, it shall be deemed as a refusal to ratify. Before the contract is ratified, the bona fide counterparty has the right to rescind it. The withdrawal shall be made by means of notice.

If the actor has no power of agency, exceeds the power of agency, or concludes a contract in the name of the principal after the power of agency has terminated, and the counterparty has reason to believe that the actor has the power of agency, the act of agency is valid, otherwise, it is invalid.

4. Check whether the legal representative exceeds the authority

Contracts concluded by the legal representative or person in charge of a legal person or other organization beyond its authority, if the counterparty knows or should know that he has exceeded his authority, the representative act is invalid.

Contracts concluded by the legal representative or person in charge exceeding the authority, if the counterparty knows or should know that he has exceeded the authority, the contract is invalid; if the counterparty does not know that the person exceeds the authority, it is a bona fide counterparty and the contract is valid.

5. Check whether the parties have the right to dispose of the contract property

If a person without the right of disposition disposes of other people's property without ratification by the obligee or the person without the right of disposition has not obtained the right of disposition after signing the contract, the contract is invalid.

It should be understood and judged whether the parties have the right to dispose of the subject matter of the contract. If there is no right to dispose, the obligee should be required to ratify, otherwise, the contract will be invalid.

Fourth, whether the parties have the will of good faith or whether they are obviously suspected of fraud

Audit method:

1. Check whether the party has an ICE8000 credit ID card or ask the party to provide a letter of guarantee issued by an ICE8000 credit agency. If there is an ICE8000 credit card or this letter, it means that the party has a sincere will;

2. Through ICE8000 credit search, Baidu, GOOGL, etc., search the credit records of the parties on the Internet, and analyze these credit records to see if they are bad or notorious;

3. Entrust a professional credit company to conduct an investigation.

V. Whether the parties have the ability to perform the contract

Reviewing contract performance capabilities is to find out the other party's existing, actual, and true business conditions. The parties can be required to provide financial statements and other materials, and then through professional credit analysis, the ability of the parties to perform the contract can be judged.

The review methods are:

2. Require the staff of the credit investigation and analysis post of the credit management department or entrust a professional credit agency to conduct credit investigation and credit analysis on the contract subject, and review whether the contract subject's actual ability to perform the contract is obviously inconsistent with the opinions in the credit investigation report contract.

3. If it is an investment contract, the financing party can be required to pass the ICE8000 integrity rating or credit evaluation, so that the financing party can establish a sound management system and an advanced integrity culture.

Section 2 Ensuring that the form of the contract is signed and that the important terms are complete

1. Choose the appropriate contract signing form

Contracts can be signed in written form, oral form, fax form, e-mail form, etc. Written signing forms also include written face-to-face signing and written letter signing. The former means that both parties sign in person, and the latter means that both parties sign by means of letters such as delivery.

For important contracts such as credit sales contracts, they must be signed in written form. If necessary and possible, they should be signed in writing, and must not be signed by fax or email. Although the method of signing contracts by fax and e-mail is legal in itself, it is difficult to prove the contract signed by fax and e-mail when there is a contract dispute, or when encountering a professional liar, especially the facsimile contract, which is easy to forge. Uniqueness is always flatly denied. If your company always signs credit sales contracts with others by fax, and one of the 100 contracts is maliciously defaulted, the bad debt loss may be higher than the profits created by the other 99 contracts.

Second, when signing a contract, you should strictly review the terms of the contract to ensure that the important terms are complete, and you may wish to consult a professional if you have the conditions.

According to the characteristics of contract fraud, in order to prevent the other party from using the terms of the contract to cheat, the terms of the contract should be strictly examined to make the relationship between rights and obligations in the contract standardized, clear and easy to perform, and special attention should be paid to the important terms of the contract.

The important terms of the contract generally include:

1. Goods quality standard;

2. The price of the goods;

3. Delivery time;

4. Delivery location;

5. Delivery and inspection method (signature of delivery certificate, inspection time);

6. Payment method (cash, transfer, money order);

7. The time when the invoice is issued (whether the invoice is issued before payment or after payment).

The agreement on the above important clauses should strive to be clear, clear, complete, and tireless, and must not be vague, incomplete, or ambiguous, which will bury hidden dangers for the future performance of the contract.

Practice has proved countless times that the simpler the contract, the greater the risk. If the customer complains that the content of the contract is too complicated and therefore refuses to sign the contract, it can only show that the customer's management quality is poor or the customer is suspected of deception.

Section 3 Review Whether the means and contents of the contract are legal

If the method of signing the contract is illegal or the content of the agreement is illegal, the contract will be invalid.

1. One party concludes the contract by means of fraud or coercion, which damages the national interest.

Judging from the legislative experience of various countries, most countries will treat contracts concluded due to fraud or duress as revocable contracts. For example, in countries with civil law systems, Article 318 of the German Civil Code stipulates: "Only the parties to the contract may revoke the determination of performance due to error, coercion or fraud; the opposite party to the right of revocation is Other parties.” Article 1111 of the French Civil Code stipulates: “Coercion against a person who has entered into a contract to undertake obligations constitutes a cause of invalidity.” Article 96 of the Japanese Civil Code stipulates: “An expression of intention due to fraudulent coercion, may be revoked." As mentioned above, in our country's original legislation, no matter it is the "General Principles of Civil Law" or the three contract laws, contracts concluded due to fraud or duress are all stipulated as invalid without exception. contract. The later "Contract Law" adopted the following "dichotomy" for the determination of the validity of contracts concluded due to fraud and duress, namely:

1. If one party concludes a contract by means of fraud or coercion, if it damages the interests of the state, the contract is invalid. First of all, although in most cases, the problems caused by fraud and coercion are mainly that the expression of intention is untrue and may cause partial interest imbalance between the parties, but another situation in practice is: one of the parties is fraudulent, Coercive behavior and means not only damage the interests of the other party, but also constitute a hazard to the sound operation of the entire social and economic order. Therefore, in order to protect the national and social public interests, contracts concluded under such circumstances due to fraud or coercion should be deemed invalid. Secondly, in the legislative process of this contract law, some scholars have repeatedly emphasized that fraudulent and coercive contracts are generally defined as revocable contracts in foreign legislation. In this regard, I believe that my country, as a socialist country, is quite different from Western countries in terms of economic foundation and social system, and the practices of Western countries cannot fully adapt to my country's national conditions. In the field of contractual relations, for situations that endanger the national and social public interests, the power and means of active intervention by the state must be reserved. Therefore, fraudulent and coercive contracts in the above situations should be classified as invalid contracts. Finally, characterization of fraudulent and coercive contracts that damage national interests as invalid contracts can also provide a reasonable basis for pursuing administrative and criminal liabilities of the fraudulent or coercive party beyond civil liability.

2. If one party uses fraud and coercion to force the other party to conclude a contract against its true intention, if the national interest is not damaged, the contract can be revoked. For this type of contract, it is more appropriate to define it as a revocable contract: under normal circumstances, the main effect of the fraudulent or coerced party after being deceived or coerced is that the intention is not true, that is, the freedom of will is restricted , the party concerned made a statement that did not conform to his true intention. But, objectively, will this untruthful expression definitely bring actual damage to the deceived or coerced party? In practice, the situation of fraudulent and coerced contracts is very complicated. Therefore, defining such contracts as revocable contracts and giving the fraudulent and coerced party the right to choose means respecting the independent will of the parties and safeguarding the interests of the victims. It is also conducive to promoting transactions and speeding up social and economic circulation.

Specifically, if a contract concluded by one party by means of fraud or coercion is invalid or revocable, the following conditions must be met:

(1) Fraud. Article 68 of the Supreme People's Court's "Opinions on Several Issues Concerning the Implementation of the General Principles of the Civil Law of the People's Republic of China (Trial Implementation)" clearly stipulates: "One party intentionally informs the other party of false information, or deliberately conceals the real situation, and induces the other party to make a Wrong expression of intention can be identified as a fraudulent act.” The so-called fraudulent act refers to an act in which one party intentionally informs the other party of false information, or conceals the truth, and induces the other party to make a wrong expression of intention and conclude a contract.

In practice, there are many types of fraudulent behavior, such as selling fake and shoddy products, forging product origin or quality certificates, providing false product instructions, signing contracts without the ability to perform to defraud deposits or loans, etc. wait. Various fraudulent acts may cause losses to the deceived party. From a practical point of view, fraud and coercion may directly damage the interests of the state, and may also damage the interests of the collective or a third party.

The elements of fraud are:

1. Subjectively, the fraudulent party has the intention to deceive. The so-called intentional deceit means that the fraudulent party knows that what he tells the other party is false, and may cause the other party to fall into a wrong understanding, and hopes or allows this result to happen. It can be seen that the fraudulent party is actually malicious. The fact that the fraudulent party informs false information, regardless of whether it benefits itself or a third party, does not prevent the formation of malicious intent. If the fraudster realizes that his fraudulent behavior will benefit himself or a third party and cause damage to the other party and acts maliciously, it can be considered that the fraudster has subjective malice.

2. Objectively, the fraudulent party commits a fraudulent act. The so-called fraudulent behavior refers to the behavior of the fraudulent party deliberately expressing its fraud to the outside. In practice, it mostly manifests as deliberately stating false facts or deliberately concealing the real situation to make others fall into the wrong behavior. The so-called deliberate disclosure of false information refers to false statements, such as saying that a product of low quality is a high-quality product. The so-called intentional concealment of the real situation means that the perpetrator is obliged to truthfully inform the other party of a certain real situation but deliberately fails to do so. According to the principle of good faith, the parties should truthfully inform the other party of important information such as the method of use, performance, and hidden defects of the product. This is an accompanying obligation of the parties, and violation of such obligations may constitute fraud.

3. The defrauded party falls into error due to fraud. In the case of fraud, the defrauded party falls into a false perception due to fraud. It should be noted: (1) The false information provided by the fraudster is closely related to the content of the contract; if there is no connection with the content of the contract, it cannot be considered that there is a causal link between the fraudulent act and the misunderstanding. (2) The victim misunderstood the content of the contract based on a false situation, for example, mistaking the counterfeit medicine for the real medicine due to misbelief in the other party’s fake medicine propaganda. If after the fraudster commits the fraudulent act, the deceived person does not fall into a mistake or the error content that occurs is not caused by fraud, it does not constitute fraud.

4. The defrauded person expressed his will due to a mistake. The defrauded person expressed his will and concluded a contract based on the erroneous understanding of the fraud, which shows that there is a causal link between the fraudulent behavior and the victim's untrue expression of will. If the defrauded person falls into a mistake due to the fraudulent behavior, but does not express his intention, it cannot be considered as fraudulent.

(2) Coercion. Article 69 of the Supreme People's Court's "Opinions on Several Issues Concerning the Implementation of the General Principles of the Civil Law of the People's Republic of China (Trial)" defines how to determine coercion, "in order to cause damage to the life, honor, property, etc. of citizens and their relatives and friends Or coercion to force the other party to act contrary to the true intention by coercing to cause damage to the honor, reputation, property, etc. Coercion is the act of forcing the other party to make an untrue expression of will and conclude a contract.

The constituent elements of coercion are:

1. The perpetrator has the intention to coerce. The so-called intentional coercion means that the perpetrator clearly knows that his behavior will cause the counterparty to fall into psychological fear, and expresses his will against his true will, and hopes or allows this result to happen. Generally speaking, the intention of coercion does not include the coercion's desire to obtain certain benefits for itself through the coercion, and profit is only a matter of its motivation. It is precisely because the coercion has the intention of coercion, so the degree of its fault is relatively large.

3. The intimidator has carried out an act of coercion. Coercive behavior includes the threat of imminent harm or the threat of direct harm to another person. The intimidator can threaten to cause damage to citizens, their relatives and friends, or threaten to cause damage to a legal person. The coercion does not necessarily depend on whether the harm is serious. Fear can constitute coercion. It should be noted that since the coercive act is carried out against a specific party, the determination of whether the coercive act is constituted should be judged on the basis of whether the specific victim, rather than ordinary people, feels fear under the circumstances at the time. Coercion can be constituted even if the victim does not feel fear.

Coercive behavior is usually carried out to force the other party to enter into the contract when the contract is concluded. After the contract is concluded, coercion by one party to force the other party to change or access the contract may also constitute coercion. If the purpose of coercion is not to force the other party to enter into a contract, such behavior will constitute a tort or other illegal act, and there will be no issue of coercion into a contract.

3. The coerced person entered into a contract due to coercion. That is to say, because one party's coercive behavior makes the other party psychologically fearful, that is, because he is facing damage or will face damage, he will have a psychological state of terror and fear. Under the domination of this psychological state, the coerced person is coerced to conclude contract. Since the coerced person concluded the contract under the condition of being intimidated, the meaning is untrue. However, if the coercive act of the coercing party does not arouse fear in the coerced person or even if there is fear, but does not make a certain expression of will, it cannot be considered that there is a causal relationship between the coercive act and the expression of will of the coerced person.

4. Coercion is illegal. Coercion imposes a kind of coercion and threat on the other party. This threat must be illegal and has no legal basis. If one party exerts some kind of pressure on the other party under the premise of legal basis, it does not constitute coercion. In addition, after the conclusion of the contract, if one party refuses to perform the contract, and the other party puts pressure on the other party to perform the contract by legal means such as imminent litigation, it does not constitute coercion.

2. Malicious collusion to damage the interests of the state, collective or third party

The contract of malicious collusion refers to the illegal collusion between the two parties to conclude a certain contract, which causes damage to the interests of the state, the collective or a third party. It can be seen that the behavior of the perpetrator is obviously illegal, so it can be treated as an illegal contract. The main features of this type of contract are:

1. The party concerned is out of subjective malice. The so-called maliciousness is relative to good faith, that is, knowing or should know that a certain behavior will cause damage to the country, the collective or a third party, and intentionally do it. If both parties or one party does not know or should not know the damage result of their actions, it does not constitute malicious intent. The parties have malicious intentions, indicating that they have subjective intentions to violate the law.

2. The purpose of the collusion between the parties is to harm the interests of the state, the collective or a third party. Collusion, first of all, means that the parties have a common purpose, that is, they all hope to harm the interests of the state, the collective or a third party through the implementation of certain actions. The common purpose may be manifested as an agreement reached by the parties in advance, or it may be that one party expresses its intention, and the other party or other parties know that the purpose achieved by implementing the act is illegal, and express acceptance in a tacit way. Secondly, the parties cooperated with each other or jointly implemented the illegal act. The intention expressed by the parties in malicious collusion is true, but this expression of intention is illegal and therefore invalid.

3. Cover up illegal purposes with legal forms

The so-called concealment of illegal purpose in a legal form means that the behavior performed by the party is legal in form, but illegal in content and purpose. This kind of behavior is also called concealment behavior. In the implementation of this kind of behavior, the form or behavior intentionally expressed by the parties is not intended to achieve the purpose, nor is it the real meaning, but only hopes to cover up and achieve its illegal purpose through this form and behavior. For example, in the transfer of real estate, the buyer and the seller achieve the purpose of evading national taxation. On the surface, they sign a house gift contract and handle the gift certificate, but they pay the house money in private. Another example is that two trading companies, A and B, enter into a joint venture contract, A invests in currency, and B invests in business buildings, but it is agreed that A will not participate in the operation and will not bear risks, and B will pay A 20% interest on its invested capital every year. The proportion is a typical "joint operation, but actually a loan", that is, the legal form of the joint operation is used to cover up the illegal content of the lending activities of illegal financial institutions, with the purpose of obtaining high interest.

Fourth, harming the public interest

According to the practice of civil legislation in our country, harming the public interest is equivalent to the principle of public order and good customs in foreign civil laws. This principle first originated in Rome, and was widely used for reference by the civil legislation of civil law countries. For example, Article 6 of the French Civil Code states: "Persons may not specifically agree to violate the laws concerning public order and good morals." Article 138(1) of the German Civil Code states: "Legal acts contrary to good morals , invalid". Article 91 of the Civil Code of Japan stipulates: "A legal act whose subject matter is contrary to public order and good morals shall be invalid."

As the basic principle of modern civil law, the principle of public order and good customs embodies the value concept of social standard. Its main function is to adjust the conflict between personal interests, social interests and public interests, and it plays an important role in maintaining social economic order and public morality. , so it is considered by some scholars to be the supreme principle in modern civil law.

In my country's civil legislation, whether it is the "General Principles of Civil Law" or "Contract Law", safeguarding social interests is the basic principle. From the perspective of other status and functions, it is equivalent to the principle of public order and good customs in Western countries.

In judicial practice, there are two issues to pay attention to when determining invalidity:

1. Correctly handle the relationship between contracts that damage the public interest and other invalid contracts. Judging from the essence and core of the invalid contract system, the reason why such contracts are invalidated is because they violate the law and social public interests. Judging from the provisions of Article 52 of the "Contract Law", other types of invalid contracts also have the attribute of directly or indirectly damaging the public interest.

2. Correctly grasp the judgment standard of harming the social public interest: as a basic principle clause, its most basic feature is its abstractness and generality, so it is particularly important to master its judgment standard in practice, and this judgment standard It cannot be directly stipulated by legislation. Because if various specific standards and applicable situations are directly stipulated by legislation, this clause will lose its abstractness and generality, and at the same time, it will lose its function of overcoming the limitations of statutory law. Judging from foreign legislation and judicial experience, the so-called standards are often sought through some writings and classic cases. Regarding the scope and standards of social public interests, we have discussed that social interests should include "the foundation, environment, order, goals and ultimate principles of social life in our country, as well as good customs and habits".

V. Violation of mandatory provisions of laws and administrative regulations

This kind of contract is a typical invalid contract. The laws mentioned here refer to the laws formulated by the National People's Congress and its Standing Committee, and the administrative regulations refer to the regulations formulated by the State Council. Acts that violate these national laws and regulations are of course invalid. All invalid contracts are illegal, and the violation of the mandatory provisions of laws and administrative regulations is more obvious than other invalid contracts in terms of illegality. Most of the parties have the intention to violate the law subjectively when they conclude such contracts (of course, even if the parties violate the law subjectively out of negligence, that is, they do not know that the contract clauses entered into are prohibited by the law at the time of signing the contract, or shall confirm that the contract is void). It is worth noting that my country's Contract Law only stipulates that contracts that violate the mandatory provisions of national laws and administrative regulations stipulated by the State Council are invalid, but does not mention the issue of whether contracts that violate administrative regulations, local regulations and local regulations are invalid. . This is not to say that all contracts that violate these provisions are valid, but only that contracts that violate these provisions are not necessarily invalid contracts. Whether these contracts should be declared void should consider various factors, for example, whether the violated provisions comply with National laws and regulations, whether they conform to the basic spirit of the Constitution and laws, etc.

6. For contracts that require approval and registration in accordance with laws and administrative regulations to become effective, contracts without approval or registration are invalid. At present, the contracts that need to be approved and registered mainly include: land use rights, real estate, motor vehicle sales and mortgage contracts.

Section 4 Agreement on Credit Supervision Clause (CS Clause)

CREDIT-SUPERVISING TERMS, referred to as the CS clause, refers to the clauses that stipulate credit supervision rights, obligations, and dispute resolution mechanisms. As a condition for purchase, sale, investment, cooperation, and service, people can agree on CS terms with each other in contracts or other forms to avoid the risk of dishonesty and accumulate their own integrity records.

To agree on the CS terms, just add the following content to the contract:

1. "This contract is signed and executed in accordance with the principle of good faith, moral bottom line, and social responsibility bottom line. If one party believes that the other party has broken promises and breached the contract, it is obliged to first file an internal complaint in accordance with the "Internal Complaint Standards of ICE8000 International Credit Standard System"; one party believes that If the other party is honest, it is obliged to give praise in accordance with the "ICE8000 International Credit Standard System Recognition Standards"; if one party has suggestions for the other party, it is obliged to make suggestions in accordance with the "ICE8000 International Credit Standard System Suggestion Standards."

Or: 2. "This contract is signed and executed in accordance with the principle of good faith, the bottom line of morality, and the bottom line of social responsibility. If one party believes that the other party has breached the contract, it is obliged to make a public complaint in accordance with the "Internal Complaint Standards of the ICE8000 International Credit Standard System". Unresolved, it is obliged to conduct arbitration in accordance with the "ICE8000 International Credit Standard System International Credit Dispute Arbitration Standard."

Agreement on the CS clause can reward the honesty with credit and punish the untrustworthy with credit, which can avoid the intensification of conflicts between the two parties due to subjective disputes, and can prevent the other party from creating or using contract disputes on the Internet or other means Criticism by yourself can use the dispute resolution mechanism of the ICE8000 international credit standard system to solve the problem, and can also reduce the dispute risk brought by judicial injustice or judicial inefficiency to a certain extent. In practice, it will greatly reduce the chance of the parties being deceived .

(Note: Before agreeing on the CS terms, you must ensure that the copy of the legal representative’s identity card and business license provided by the other party is true.)

Section 5 Agreeing on Dispute Jurisdiction and Applicable Law

The agreement on the dispute jurisdiction clause is used to avoid the judicial trap carefully designed by the other party. Some scammers often have good social relations in their localities, and use local protectionism to evade legal sanctions. Generally, it should be agreed that the people's court at the place where both parties are located shall have jurisdiction. The local people's court files a lawsuit. Otherwise, if the other party sues first, the other party's people's court will file the case first, and you will have to go to the other party's location to file a lawsuit, which consumes a lot of financial resources and energy.

If the parties are unwilling to agree to a court to govern their dispute, they can also agree to an arbitration institution with high credibility to make a ruling.

If both parties belong to different countries or there are other foreign-related factors, when a dispute arises in the contract, it will involve the issue of which country's law is applicable. The parties can agree on the applicable governing law in the contract.

The method of agreeing to have the jurisdiction of the court where one party is located adds a clause to the contract: matters not covered in this contract shall be resolved through negotiation between the two parties. If the negotiation fails, either party has the right to sue in the people's court where Party A is located.

The method of agreeing to have the jurisdiction of either party's local court is to add a clause in the contract: the two parties will negotiate to resolve matters not covered in this contract. If the negotiation fails, either party has the right to sue in the local people's court.

The method of agreeing on the applicable law is to add a clause in the contract: "The matters not stipulated in this contract shall be governed by the laws of *country". Or: "Any disputes in this contract shall be handled according to *some law."

Of course, for foreign-related contracts, when specifying the court of jurisdiction and the applicable law, attention should be paid to the corresponding relationship between the two. For example, it is not possible to agree to be governed by Chinese courts and at the same time agree to deal with it according to British law.

Section 6 Clearly indicate the place where the contract was signed

Many well-designed contract disputes are essentially contract fraud and are suspected of constituting crimes. Victims involved in economic fraud cases should first report the case to the public security organ instead of going to the court for litigation, because once the court accepts the case, the contract fraud case becomes an ordinary economic dispute. However, some scammers often carefully design jurisdiction so that when people report to the local public security organ, they find that the local public security organ has no jurisdiction. The agreement on the terms of the signing place of the contract is of great significance for pursuing the criminal responsibility of the liar and recovering his own economic losses.

Our country's criminal law stipulates that criminal cases are under the jurisdiction of the public security organ at the place where the crime was committed. The criminal place of contract fraud includes the place where the contract is signed and the place where the contract is performed. Since the place of performance of the contract is often at the location of the other party, it is meaningless. Only the place where the contract is signed is agreed. According to the judicial interpretation of the Supreme Law: Where a written contract specifies the place where the contract is signed, the place stated in the contract shall prevail; If the seal is not in the same place, the place where the last party signed and sealed the contract is the place where the contract was signed, so the place of signing is clearly indicated on the contract as the locality or signed by the last party to obtain the jurisdiction of the local public security organ over the suspected criminal case .

Section 7 If necessary and possible, agree to a breach of contract

The breach of contract clause clearly stipulates the responsibility for breach of contract, and lays a good foundation for possible future litigation and rights protection. Liquidated damages or interest on arrears can be clearly stipulated in the breach of contract clause. For example: if Party A fails to complete the project on schedule, it shall pay Party B 100,000 yuan for breach of contract.

The liquidated damages in the breach clause should not be too high. Because of the high liquidated damages, if a dispute arises, the other party will ask the court to revoke the clause on the grounds that it violates the principle of fairness, making the clause impossible to realize. There have been many such cases in the country.

SECTION 8 If necessary and possible, agree to a retention of title clause

As a condition of sale, the supplier may stipulate that legal title to the goods is retained and title does not pass to the buyer until full payment has been made by the buyer. In the United Kingdom, the retention of title clause in sales contracts is known as the Romalpa clause, which originated from an important court decision in 1976, which is widely used around the world. China's contract law also clearly confirms the retention of ownership clause (see: Article 133 of the Contract Law stipulates that the ownership of the subject matter shall be transferred from the delivery of the subject matter, unless otherwise stipulated by law or otherwise agreed by the parties. Article 134 of the Contract Law stipulates: The parties may agree in the sales contract that if the buyer fails to perform the payment or other obligations, the ownership of the subject matter shall belong to the seller.).

The retention of ownership clause can prevent the risk of bankruptcy liquidation of the other party to a limited extent. With the development and regulation of my country's market economy, bankruptcy liquidation will gradually increase. However, the retention of title clause has its limitations:

1. It cannot be applied to the transaction of providing services, unless the goods are provided as part of the service;

2. Suppliers cannot ask for the return of goods that have been manufactured into other products, such as: bricks have caused house conditions;

3. The supplier cannot claim ownership of the goods that have been sold by the other party, for example: the supermarket has sold the goods;

4. The supplier must be able to identify the goods and prove that they are original.

Section 9 If necessary and possible, agree on terms of guarantee

If necessary and possible, the parties to the contract can agree on guarantee clauses to guard against credit risks. Guarantee clauses agreed in China or guarantee contracts where both parties agree to use Chinese law as the applicable law must be carried out in accordance with the "Guarantee Law of the People's Republic of China", otherwise, the guarantee clauses may become invalid. When agreeing on the terms of guarantee, you should pay attention to the following:

1. If the guarantee is provided by a legal person or a natural person, it shall be checked whether the guarantee is eligible for guarantee. State organs shall not be guarantors, except those approved by the State Council to use loans from foreign governments or international economic organizations for on-lending. Schools, kindergartens, hospitals and other public institutions and social groups shall not be guarantors. A branch or functional department of an enterprise legal person shall not be a guarantor, and if a branch of an enterprise legal person has written authorization from the legal person, it may provide a guarantee within the scope of authorization. A natural person without capacity for civil conduct shall not serve as a guarantor.

2. When using property as mortgage, it should be checked whether the property can be mortgaged. The following property may not be mortgaged:

(1) Land ownership;

(2) Collectively owned land use rights such as cultivated land, homesteads, private plots, and private hills, but Item 5 of Article 34 of the "Guarantee Law of the People's Land use rights of barren hills, barren ditches, barren hills, barren beaches and other wastelands agreed to be mortgaged), Paragraph 3 of Article 36 (that is, the land use rights of townships (towns) and village enterprises shall not be mortgaged separately. Township ( town), factory buildings of village enterprises and other buildings, the land use right within the occupied area shall be mortgaged at the same time.) except as stipulated;

（3）Schools, kindergartens, hospitals and other public institutions for the purpose of public welfare, educational facilities, medical and health facilities and other social public welfare facilities of social groups;

(4) Properties whose ownership and use rights are unclear or disputed;

(5) Property that has been sealed up, seized, and supervised according to law; (6) Other property that cannot be mortgaged according to law.

3. If the following properties are mortgaged, registration of the mortgaged property shall be carried out, and the mortgage contract shall become effective from the date of registration. The departments for mortgage registration are as follows:

(1) If the land use right without fixed objects on the ground is mortgaged, the land management department that issues the land use right certificate;

(3) If the forest is mortgaged, it shall be the competent department of forestry at or above the county level;

(4) If the aircraft, ship or vehicle is mortgaged, it shall be the registration department of the means of transport;

(5) If the equipment and other movable properties of the enterprise are mortgaged, it shall be the administrative department for industry and commerce in the place where the property is located.

4. If the parties mortgage other properties, they can voluntarily register the mortgaged property, and the mortgage contract will take effect from the date of signing. If the party fails to register the mortgaged property, it shall not confront the third party. If the parties handle the registration of the mortgaged property, the registration department shall be the notary department in the place where the mortgagor is located.

The above content is excerpted from: "Building an Integrity Unit——Risk Control and Integrity Management" (by Fang Bangjian)

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