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(Adopted and Promulgated by the Second Session of the Ninth National People's
Article 212 Definition of Leasing Contract
A leasing contract is a contract whereby the lessor delivers to the lessee the
lease item for it to use or accrue benefit from, and the lessee pays the rent.
Article 213 Terms of Leasing Contract
A leasing contract includes terms such as the name, quantity and purpose of
the lease item, lease term, amount of rent, time and method of rent payment,
as well as maintenance and repair of the lease item, etc.
Article 214 Limit on Lease Term; Renewal
The lease term may not exceed twenty years. If the lease term exceeds twenty
years, the portion of the lease term beyond the initial twenty year period is
invalid.
At the end of the lease term, the parties may renew the lease, provided that
the renewed term may not exceed twenty years commencing on the date of renewal.
Article 215 Writing Requirement in Case Lease Term
Is Six Months or Longer
Where the lease term is six months or longer, the lease shall be in writing.
If the parties fail to adopt a writing, the lease is deemed a non-term lease.
Article 216 Lessor's Obligation to Deliver Lease Item
The lessor shall deliver the lease item to the lessee in accordance with the
contract and shall, during the lease term, keep the lease item fit for the prescribed
purpose.
Article 217 Manner of Using Lease Item
The lessee shall use the lease item in the prescribed manner. Where the manner
of use of the lease item was not prescribed or clearly prescribed, and cannot
be determined in accordance with Article 61 hereof, the lease item shall be
used in a manner consistent with its nature.
Article 218 Lessee Not Liable for Wear and Tear
Where the lessee used the lease item in the prescribed manner or in a manner
consistent with its nature, thereby causing wear and tear to the lease item,
it is not liable for damages.
Article 219 Lessor Entitled to Terminate in Case of
Unauthorized Use
Where the lessee failed to use the lease item in the prescribed manner or in
a manner consistent with its nature, thereby causing damage to it, the lessor
may terminate the contract and claim damages.
Article 220 Lessor's Maintenance Obligations
The lessor shall perform the obligations of maintenance and repair of the lease
item, except otherwise agreed by the parties.
Article 221 Lessee's Remedies in Case of Lessor's Failure
to Maintain Lease Item
Where the lease item needs maintenance or repair, the lessee may require the
lessor to perform maintenance or repair within a reasonable time.
If the lessor fails to fulfill its obligations of maintenance or repair, the
lessee may maintain or repair the lease item on its own at the lessor's expense.
Where the lessee's use of the lease item is impaired due to maintenance or repair
thereof, the rent shall be reduced or the lease term shall be extended accordingly.
Article 222 Lessee's Obligation of Due Care
The lessee shall keep the lease item with due care and shall be liable for damages
if the lease item was damaged or lost due to improper care.
Article 223 Improvement or Addition
Subject to consent by the lessor, the lessee may make improvement on or addition
to the lease item.
If the lessee made improvement on or addition to the lease item without consent
by the lessor, the lessor may require the lessee to restore the lease item to
its original condition or claim damages.
Article 224 Sublease
Subject to consent by the lessor, the lessee may sublease the lease item to
a third person. Where the lessee subleases the lease item, the leasing contract
between the lessee and the lessor remains valid, and if the third person causes
damage to the lease item, the lessee shall pay damages.
Where the lessee subleases the lease item without the consent of the lessor,
the lessor may terminate the contract.
Article 225 Benefit Accrued from Lease Item During
Lease Term
During the lease term, any benefit accrued from the possession or use of the
lease item belongs to the lessee, except otherwise agreed by the parties.
Article 226 Time for Rent Payment
The lessee shall pay the rent at the prescribed time. Where the time of payment
was not prescribed or clearly prescribed, and cannot be determined in accordance
with Article 61 hereof, the rent shall be paid at the end of the lease term
if it is less than one year; if the lease term is one year or longer, the rent
shall be paid at the end of each annual period, and where the remaining period
is less than one year, the rent shall be paid at the end of the lease term.
Article 227 Lessor's Remedies in Case of Non-Payment
of Rent
Where the lessee failed to pay or delayed in paying the rent without cause,
the lessor may require the lessee to pay the rent within a reasonable period.
If the lessee fails to pay the rent at the end of such period, the lessor may
terminate the contract.
Article 228 Lessee's Remedies in Case of Third Party
Claim; Duty to Notify
If due to any claim by a third person, the lessee is unable to use or accrue
benefit from the lease item, the lessee may require reduction in rent or refuse
to pay rent.
In case of any claim by a third person, the lessee shall timely notify the lessor.
Article 229 Leasing Contract Not Affected by Change
of Ownership
Any change of ownership to the lease item does not affect the validity of the
leasing contract.
Article 230 Sale of Dwelling Unit under Lease
Where the lessor is to sell a dwelling unit under a lease, it shall give the
lessee a reasonable advance notice before the sale, and the lessee has the right
of first refusal under the same conditions.
Article 231 Lessee's Remedies in Case of Damage Not
Attributable to Itself
Where the lease item was damaged or lost in part or in whole due to any reason
not attributable to the lessee, the lessee may require reduction in rent or
refuse to pay rent; where the purpose of the contract is frustrated due to damage
to or loss of the lease item in part or in whole, the lessee may terminate the
contract.
Article 232 Non-Term Lease
Where the term of a lease was not prescribed or clearly prescribed, and cannot
be determined in accordance with Article 61 hereof, such lease is deemed a non-term
lease. Either party may terminate the contract at any time, provided that the
lessor shall give the lessee a reasonable advance notice before it terminates
the contract.
Article 233 Lessee Entitled to Terminate in Case of
Danger to Safety or Health
Where the lease item poses a danger to the safety or health of the lessee, the
lessee may terminate the contract at any time even if the lessee was aware of
the quality non-compliance of the lease item at the time of conclusion of the
contract.
Article 234 Lease of Dwelling Unit Assumable
Where the lessee is deceased during the term of a dwelling unit lease, the person
jointly living in the unit with the lessee while the lessee was alive may continue
leasing it on the terms of the original leasing contract.
Article 235 Condition of Lease Item at End of Lease
Term
The lessee shall return the lease item at the end of the lease term. The returned
lease item shall be in a condition resulting from its use in the prescribed
manner or in a manner consistent with its nature.
Article 236 Effect of Continued Use Beyond Lease Term
Upon expiration of the lease term, if the lessee continues to use the lease
item without objection by the lessor, the original leasing contract remains
effective, provided that it becomes a non-term lease.
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