(Adopted 31 October 1993 by the Fourth Session of the Standing Committee of the Eighth National People's Congress. Promulgated 31 October 1993)

CONTENTS

CHAPTER I GENERAL PRINCIPLES
CHAPTER II CONSUMER RIGHTS
CHAPTER III OBLIGATIONS OF BUSINESS OPERATORS
CHAPTER IV STATE PROTECTION OF THE LEGAL RIGHTS AND INTERESTS OF
CONSUMERS
CHAPTER V CONSUMER ORGANIZATIONS
CHAPTER VI DISPUTE RESOLUTION
CHAPTER VII LEGAL LIABILITY
CHAPTER VIII SUPPLEMENTARY PRINCIPLES

CHAPTER I GENERAL PRINCIPLES

Article 1 This Law is formulated in order to protect the legal rights and interests of consumers, to maintain social and economic order and to promote the healthy development of the socialist market economy.

Article 2 The rights and interests of consumers when purchasing or using commodities or receiving services as consumer needs for daily use shall be protected by this Law. Rights and interests covered by this Law shall be protected by other relevant laws and regulations.

Article 3 This Law shall be observed by business operators in the provision of commodities produced or sold and in the provision of consumer services. Where matters are not covered by this Law, other relevant laws and regulations shall be observed.

Article 4 Transactions between business operators and consumers shall be conducted according to the principles of voluntary participation, equality, fairness, honesty and trustworthiness.

Article 5 The State shall protect consumers' legal rights and interests against infringement.

The State shall adopt measures to protect consumers in the legal exercise of their rights and shall safeguard consumers' legal rights and interests.

Article 6 The whole society shall bear responsibility for the protection of consumers' legal rights and interests.

The State shall encourage and support social control by any organization or individual of acts harmful to consumers' legal rights and interests.

The mass media shall improve propaganda on the safeguarding of consumers' legal rights and interests and shall use public opinion to control acts harmful to consumers' legal rights and interests.

CHAPTER II CONSUMER RIGHTS

Article 7 In the purchase or use of a commodity or receipt of a service, a consumer shall have the right to the safety of person and property guaranteed.

A consumer shall have the right to require that commodities and services provided by a business operator meet with requirements for the safety of person and property.

Article 8 A consumer shall have the right to knowledge of the true facts concerning commodities purchased and used or services received.

A consumer shall have the right to require relevant information of a business operator providing commodities on price, place of origin, producer, usage, functions, specifications, grade, main ingredients, date of production, date of expiry, certificate of inspection, operation manual and after-sale service, or of contents, specifications and fees of services in respect of commodities or services as the situation requires.

Article 9 A consumer shall have the right to free choice in purchasing commodities or services.

A consumer shall have the right to freely choose a business operator providing commodities or services, types of commodity and modes of service and whether to purchase a commodity or receive a service.

A consumer shall have the right to compare, appraise and select when freely choosing a commodity or service.

Article 10 A consumer shall have the right to fair dealing.

A consumer shall have the right to fair terms of trade and conditions such as quality guarantee, reasonable price, accurate measures, etc, when purchasing a commodity or receiving a service, and shall have the right to reject coercive transactions by business operators.

Article 11 A consumer shall have the right to obtain compensation in accordance with the law where harm is inflicted upon their person or property as a result of the purchase or use of a commodity or the receipt of a service.

Article 12 Consumers shall, in accordance with the law, have the right to establish social organizations ensuring their legal rights and interests.

Article 13 A consumer shall have the right to obtain information relating to consumption and the protection of the rights and interests of consumers.

A consumer shall strive to master all of the necessary information and the ability to use a commodity or service, shall use commodities properly and shall increase awareness of self protection.

Article 14 A consumer shall, when purchasing or using a commodity or receiving a service, have the right to have human dignity, national customs and traditions respected.

Article 15 A consumer shall have the right to supervise the protection of consumers' rights and interests in work related to commodities and services.

A consumer shall have the right to report or complain of acts infringing upon the rights and interests of consumers, and unlawful or derelict acts of State authorities and personnel in the course of protecting the rights and interests of consumers. A consumer shall have the right to criticise and make suggestions for the protection of the rights and interests of consumers.

CHAPTER III OBLIGATIONS OF BUSINESS OPERATORS

Article 16 A business operator providing a commodity or service to a consumer shall perform obligations in accordance with the Product Quality Law of the People's Republic of China and other relevant laws and regulations.

Where an agreement exists between a consumer and a business operator, obligations shall be carried out in accordance with that agreement. An agreement between the parties concerned shall not, however, be in contravention of laws and regulations.

Article 17 A business operator shall listen to and take account of suggestions regarding commodities and services provided by it and shall be subject to supervision by consumers.

Article 18 A business operator shall ensure that commodities and services provided by it meet with the requirement for the safeguard of the person and property of the consumer. Where a commodity or a service may jeopardise safety of person or property of the consumer, it shall make a true statement and clear warning explaining and indicating correct methods for the use of such a commodity or receipt of such a service and preventative measures against such an occurrence.

A business operator which finds a commodity or a service provided by it to have a serious defect which may cause harm to the safety of person or property of the consumer, even where such a commodity or a service is used correctly, must immediately make a report to the relevant authorities, inform consumers and adopt preventative measures against such occurrence.

Article 19 A business operator shall provide consumers with true information concerning commodities and shall not conduct false advertising.

A business operator shall provide true and clear answers to questions raised by consumers concerning the quality and use of commodities or services provided by it, and other related issues.

Retailers shall clearly mark prices on the commodities provided by them.
Article 20 A business operator shall clearly indicate its true name and trade.

A business operator leasing counters or venues shall clearly indicate its true name and trade.

Article 21 A business operator providing commodities or services shall issue a purchase or service voucher to consumers in accordance with relevant State regulations or commercial practices. A business operator must issue a purchase or service voucher where requested to do so by a consumer.

Article 22 A business operator shall ensure that the commodities or services which it provides possess the quality, functions, usages and dates of expiry that they should have during the normal use of such commodities or receipt of such services, except where a consumer is already aware of the existence of defects before purchasing such commodities or receiving such services.

A business operator indicating the quality condition of a commodity or a service by way of advertisement, product description, physical example or other means must ensure that the actual quality of the commodity or service provided by it is consistent with the indicated quality condition.

Article 23 A business operator which bears responsibility for guaranteed repair, replacement and return or other liability in accordance with State regulations or an agreement with a consumer in providing a commodity or a service must carry out such responsibilities in accordance with State regulations or the agreement and shall not be permitted to deliberately procrastinate or refuse to do so without
reason.

Article 24 A business operator shall not be permitted to set unreasonable or unfair terms for consumers or alleviate or release itself from civil liability for harming the legal rights and interests of consumers by means of standard contracts, circulars, announcements, shop notices, etc.

Where standard contracts, circulars, announcements, shop notices, etc, contain contents as listed in the preceding paragraph, the contents of such standard contracts, circulars, announcements and shop notices, etc, shall be invalid.

Article 25 A business operator shall not insult or slander consumers. A business operator may not search the body of a consumer or articles carried by a consumer and shall not infringe upon the personal freedom of a consumer.

CHAPTER IV STATE PROTECTION OF THE LEGAL RIGHTS AND INTERESTS OF CONSUMERS

Article 26 The State must, when formulating laws, statutory regulations and policies concerning the rights and interests of consumers, listen to and take into account the views and requirements of consumers.

Article 27 People's Governments at all levels shall strengthen their leadership in organization, coordination and supervision of the work of the relevant administrative departments for the protection of the legal rights and interests of consumers.

People's Governments at all levels shall improve supervision in order to prevent acts harmful to the safety of the person or property of consumers and to promptly stop acts which are harmful to the safety of the person and property of consumers.

Article 28 The administrations for industry and commerce and other relevant administrative departments of the People's Governments at all levels must adopt measures, in accordance with laws and statutory regulations and within their respective powers and functions, to protect the legal rights and interests of consumers.

The relevant administrative departments must listen to the views of consumers and their social organizations on issues concerning transactions, quality of commodities and services of business operators, and investigate and handle such issues in a timely manner.

Article 29 The relevant State authorities shall penalize, in accordance with laws and statutory regulations, business operators for illegal and criminal acts that infringe upon the legal rights and interests of consumers during the provision of commodities and services.

Article 30 The People's Courts shall adopt measures to facilitate the institution of legal proceedings by consumers. Disputes over the rights and interests of consumers that meet the conditions for instituting an action under the Code of Civil Procedure of the People's Republic of China must be accepted and promptly heard.

CHAPTER V CONSUMER ORGANIZATIONS

Article 31 Consumer associations and other consumer organizations shall be social organizations that are established in accordance with the laws that carry out social supervision of commodities and services and protect the legal rights and interests of consumers.

Article 32 A consumer association shall exercise the following duties and functions:

(1) provide information and advice services for consumers;

(2) participate in the supervision and inspection of commodities and services by the relevant administrative departments;

(3) report to, inquire of or make suggestions to relevant administrative departments on issues concerning the legal rights and interests of consumers;

(4) accept complaints by consumers and conduct investigation into and mediation of such complaints;

(5) where a complaint involves issues concerning the quality of commodities and services, it may require an appraisal department to appraise the quality. Such appraisal department shall advise the appraisal findings;

(6) assist aggrieved consumers in instituting legal proceedings against acts which harm the legal rights and interests of consumers; and

(7) reveal and criticise acts harmful to the legal rights and interests of consumers through the mass media.

People's Governments at all levels shall support the consumer associations in the implementation of their duties and functions.

Article 33 Consumer organizations shall not be permitted to engage in commodity business or profit-making service provision and shall not be permitted to recommend commodities and services to the public for the purpose of making a profit.

CHAPTER VI DISPUTE RESOLUTION

Article 34 Consumers may resolve disputes with business operators over their rights and interests in the following ways:

(1) negotiate a settlement with the business operator;

(2) request a consumer association to mediate;

(3) complain to the relevant administrative department;

(4) apply to an arbitral body for arbitration in accordance with the arbitration agreement reached with the business operator; or

(5) institute legal proceedings in a People's Court.

Article 35 A consumer whose legal rights and interests are harmed during the purchase or use of a commodity may demand compensation from the seller. Where the responsibility lies with the producer or another seller that provides the commodities to the seller, the seller, after settling compensation, shall have the right to recover such compensation from that producer or that other seller.

A consumer or other injured party whose person or property is harmed due to a commodity defect may demand compensation from the seller or may also demand compensation from the producer. Where the responsibility lies with the producer, the seller, after settling compensation, shall have the right to recover from the producer. Where the responsibility lies with the seller, the producer, after settling compensation, shall have the right to recover such compensation from the seller.

A consumer whose legal rights and interests are harmed during the receipt of a service may demand compensation from the provider of that service.

Article 36 When the legal rights and interests of a consumer are harmed during the purchase and use of a commodity or receipt of a service and the original enterprise has divided or merged, the consumer may demand compensation from the enterprise that takes over the rights and obligations of the original enterprise.

Article 37 Where an illegal business operator harms the legal rights and interests of a consumer in providing commodities or services by using another party's business licence, the consumer may demand compensation from such a business operator or may demand compensation from the holder of the business licence.

Article 38 A consumer whose legal rights and interests are harmed during the purchase of commodities or receipt of services at a trade fair or at a leased counter may demand compensation from the seller of the commodities or the provider of the services. After the trade fair has finished or the lease of the counter has expired, the consumer may also demand compensation from the organizer of the trade fair or the lessor of the counter. After the organizer of the trade fair or the lessor of the counter has settled the compensation, the organizer or the lessor shall have the right to recover such compensation from the seller of the commodities or the provider of the services.

Article 39 A consumer whose legal rights and interests are harmed by a business operator that provides a commodity or a service with the use of false advertising may demand compensation from the business operator. Where an advertising operator disseminates a false advertisement, a consumer shall have the right to request the administrative department in charge to impose a penalty. If such an advertising operator fails to provide the true name and address of the business operator, that advertising operator shall bear liability for compensation.

CHAPTER VII LEGAL LIABILITY

Article 40 Except where otherwise provided by this Law, a business operator that provides commodities or services shall, in any of the following circumstances, bear civil liability in accordance with the Product Quality Law of the People's Republic of China and other relevant laws and regulations:

(1) where a defect exists in a commodity;

(2) where a commodity does not possess functions it should possess, and this is not stated when the commodity is sold;

(3) where the commodity standards indicated on a commodity or on the package of such commodity are not met;

(4) where the quality condition indicated by way of commodity description or physical sample, etc, is not met;

(5) where commodities pronounced obsolete by formal State decrees are produced or have expired or deteriorated commodities are sold;

(6) where a commodity sold is not adequate in quantity;

(7) where the service items and charges are in violation of an agreement;

(8) where demands by a consumer for repair, redoing, replacement, return, making up the quantity of a commodity, refund of a commodity purchase price or service fee or claims for compensation have been delayed deliberately or rejected without reason; or

(9) in other circumstances whereby the rights and interests of consumers, as provided by laws and regulations, are harmed.

Article 41 A business operator that causes bodily injuries to a consumer or other party in providing a commodity or a service must pay expenses such as medical treatment expenses and nursing expenses during treatment period and income lost due to absence from work. Where physical disability is caused, expenses such as assistance expenses for the tools of disabled people, living subsidies, disability compensation funds and living expenses necessary for the dependents of the disabled must also be paid. Where a criminal offence is constituted, criminal liability shall be pursued in accordance with the Law.

Article 42 A business operator that causes the death of a consumer or other party in providing a commodity or a service shall pay expenses such as funeral costs, death compensation funds and the living expenses necessary for the persons that depended on the victim while alive. Where a criminal offence is constituted, criminal liability shall be pursued in accordance with the law.

Article 43 A business operator found to have violated Article 25 of this Law by violating the human dignity or personal freedom of a consumer must stop the violation, restore the reputation of the consumer, eliminate the effects of the violation and offer an apology and compensation for any losses incurred.

Article 44 A business operator that causes damage to the property of a consumer in providing a commodity or a service must assume civil liability by means of repair, redoing, replacement, return of goods, making up the quantity of a commodity, refund of payment for the commodity and the service fee or compensation for losses, at the request of the consumer. Where the consumer and business operator have a separate agreement, such agreement shall be implemented.

Article 45 For a commodity of which the guaranteed repair, replacement and return are specified by the State or by an agreement between a business operator and a consumer, the business operator must be responsible for the repair, replacement or return. Where a commodity still cannot be used properly after being repaired twice within the guaranteed maintenance period, the business operator must be responsible for replacement or return.

Where a consumer requires a business operator to repair, replace or return a large commodity of which the repair, replacement or return is guaranteed, the business operator must bear reasonable expenses such as freight.

Article 46 A business operator that provides a commodity by mail order must provide such commodity in accordance with the agreement. If the business operator fails to do so in accordance with the agreement, it must, at the request of the consumer, implement the agreement or refund payment and bear reasonable expenses needed to be paid by the consumer.

Article 47 A business operator that provides a commodity or a service for advance payment must provide such service or commodity in accordance with the agreement. If the business operator fails to do so in accordance with the agreement, the business operator must, at the request of the consumer, implement the agreement or refund the advance payment and bear the interest on the advance payment and reasonable expenses needed to be paid by the consumer.

Article 48 Where a consumer demands the return of a commodity that has been verified not to be up to standard by the relevant administrative department in accordance with the law, the business operator must be responsible for the return of such commodity.

Article 49 A business operator that practices fraud in providing a commodity or a service must, at the request of the consumer, increase the compensation for losses incurred by such consumer. The amount of the increase in compensation shall be the price of the commodity purchased or the fee for the service received by the consumer.

Article 50 Where penalty imposing authorities and procedures are specified by the Product Quality Law of the Peoples' Republic of China or any other relevant laws and statutory regulations in any of the following circumstances involving a business operator, such laws and statutory regulations shall be implemented. Where circumstances are not specified in laws and statutory regulations, the administrations for industry and commerce shall order the matter to be rectified and may, depending on the circumstances, impose one or several of the following penalties: issuance of a warning, confiscation of the illegal income and/or imposition of a fine of between one and five times the amount of the illegal income; where no illegal income is obtained, a fine of less than RMB 10,000 yuan shall be imposed; where the circumstances are serious, the business operator shall be ordered to cease business operation for reorganization and have its business licence revoked:

(1) where a commodity produced or sold fails to meet the requirements for the protection and safety of person and property of the consumer;

(2) where a commodity is adulterated or mixed with improper elements, a fake commodity is passed off as a genuine commodity, a commodity of poor quality as a quality commodity or a sub-standard commodity is used in imitation of the standard commodity;

(3) where a commodity pronounced obsolete by formal State decrees is produced, or an expired or deteriorated commodity is sold;

(4) where the place of origin of a commodity is fabricated; the factory name or address of another party is fabricated or used without authorization; quality marks such as certification marks, famous brand marks or marks of excellence are fabricated or used without authorization;

(5) where a commodity subject to inspection or quarantine is sold without inspection or quarantine or where inspection or quarantine results are falsified;

(6) where false and misleading advertising for a commodity or a service is carried out;

(7) where demands by a consumer for repair, redoing, replacement, return, making up the quantity of a commodity, refund of payment for the commodity or service fee or compensation for losses incurred have been delayed deliberately or rejected without reason;

(8) where the human dignity or personal freedom of a consumer has been violated; or

(9) in other circumstances for which laws and regulations specify penalties for harming the rights and interests of consumers.

Article 51 A business operator that disagrees with a decision to impose an administrative penalty may, within fifteen (15) days of receiving the penalty notice, apply to the authority at the next highest level for a review of the case. A business operator that disagrees with the review decision may, within fifteen (15) days of receiving the review decision, file a suit in a People's Court. Alternatively, the business operator may also directly file a suit in a People's Court.

Article 52 If a party, by violence or threat, obstructs the personnel of a relevant administrative department in carrying out their duties in accordance with the law, criminal liability shall be pursued in accordance with the law. If a party, not by violence or threat, obstructs the personnel of a relevant administrative department in carrying out their duties in accordance with the law, penalties shall be imposed by the public security authorities in accordance with the Rules of the People's Republic of China on the Public Security Administration and Penalties.

Article 53 Personnel of government organs who neglect their duties or shelter business operators from acts harming the legal rights and interests of consumers shall be subject to administrative penalties by their units or by the authority at the next highest level. Should the action be serious enough to constitute a crime, criminal liability shall be pursued in accordance with the law.

CHAPTER VIII SUPPLEMENTARY PRINCIPLES

Article 54 The purchase and use by peasants of production materials directly used for agricultural purposes shall be handled with reference to this Law.

Article 55 This Law shall take effect from 1 January 1994.

Editor/Compiler: Shanghai International Lawyers