Chapter I. General Provisions
Article 1: This Law has been formulated for the purpose of promoting the financing of funds and the flow of commodities, safeguarding the realization of claims and developing the socialist market economy, the enactment of this Law.
Article 2 In economic activities such as lending and borrowing, buying and selling, transportation of goods, processing and contracting, creditors who need to protect the realization of their claims by means of security may set up security in accordance with the provisions of this Law.
The forms of security provided for in this Law are guarantee, mortgage, pledge, lien and deposit.
Article 3 Guarantee activities shall be guided by the principles of equality, voluntariness, fairness, honesty and credit.
Article 4 the third party for the debtor to provide security to the creditor, the debtor can be required to provide counter-guarantee.
Counter-guarantees are subject to the provisions of this Law on guarantees.
Article 5 The security contract is a subordinate contract to the main contract; if the main contract is invalid, the security contract is invalid. If the guarantee contract is otherwise agreed upon, it shall be in accordance with the agreement.
After the security contract is recognized as invalid, the debtor, the guarantor and the creditor are at fault, they shall each bear the corresponding civil liability according to their fault.
Chapter II Guarantee
Section 1 Guarantee and Guarantor
Article 6 The guarantee referred to in this Law refers to the agreement between the guarantor and the creditor that, when the debtor fails to fulfill the debt,
the guarantor fulfills the debt or assumes the responsibility in accordance with the agreement.
Article 7 A legal person, other organization or a citizen who has the ability to settle the debt on behalf of the creditor may act as a guarantor.
Article 8 The state organs shall not be the guarantor, except for the approval by the State Council for the use of foreign governments or international economic organizations to transfer loans.
Article 9 Schools, kindergartens, hospitals and other public institutions and social organizations shall not be guarantors.
Article 10 Branches and functional departments of an enterprise legal person shall not be guarantors.
Branches of an enterprise legal person with written authorization from the legal person may provide guarantee within the scope of authorization.
Article 11 No unit or individual may force a bank or other financial institution or an enterprise to provide a guarantee for another person; a bank or other financial institution or an enterprise has the right to refuse to force it to provide a guarantee for another person.
Article XII of the same debt with more than two guarantors, the guarantor shall be in accordance with the guarantee contract agreed guarantee share, bear the guarantee responsibility. There is no agreement on the share of the guarantee, the guarantor assumes joint and several liability, the creditor may require any one of the guarantor to assume full responsibility for the guarantee, the guarantor is responsible for guaranteeing the realization of all the obligations of the claim. The guarantor who has assumed the responsibility of guarantee, has the right to recover from the debtor, or request the other guarantor who has assumed joint and several responsibility to pay off its share.
Section 2: Guarantee Contract and Guarantee
Article 13: The guarantor and the creditor shall enter into a guarantee contract in writing.
Article 14 The guarantor and the creditor may enter into a separate contract of guarantee in respect of a single main contract, or may agree to enter into a contract of guarantee in respect of a certain period of consecutive contracts of loan or a contract of merchandise transaction within the limit of the maximum amount of claim.
Article 15 A contract of guarantee shall include the following contents:
(1) the type and amount of the principal claim to be guaranteed;
(2) the period of time within which the debtor is to fulfill the debt;
(3) the manner of guarantee;
(4) the scope of the guarantee;
(5) the period of guarantee;
(6) other matters which the two sides Other matters deemed necessary to be agreed upon.
The contract of guarantee does not fully have the contents of the preceding paragraph, can be corrected.
Article 16 The ways of guarantee are:
(1) general guarantee;
(2) joint and several liability guarantee.
Article 17 The parties agreed in the guarantee contract, the debtor fails to fulfill the debt, the guarantor to assume the responsibility for the guarantee, is a general guarantee.
General guarantee of the guarantor in the main contract dispute without trial or arbitration, and on the debtor's property according to law enforcement is still unable to fulfill the debt before the creditor may refuse to assume the responsibility of guarantee.
In one of the following cases, the guarantor shall not exercise the rights provided for in the preceding paragraph:
(a) the debtor's residence changes, resulting in the creditor to demand that it performs the debt of the occurrence of major difficulties;
(b) the people's court accepts the debtor's bankruptcy case, suspension of the enforcement proceedings;
(c) the guarantor in writing to waive the rights provided for in the preceding paragraph.
Article 18 The parties in the guarantee contract agreed that the guarantor and the debtor of the debt is jointly and severally liable, is jointly and severally liable guarantee.
The debtor of the joint and several liability guarantee fails to fulfill the debt at the expiration of the period for the performance of the debt stipulated in the main contract, the creditor may request the debtor to fulfill the debt, and may also request the guarantor to bear the liability within the scope of its guarantee.
Article 19 of the parties to the guarantee mode did not agree or the agreement is unclear, in accordance with the joint and several liability guarantee to assume the responsibility for the guarantee.
Article 20 The guarantor of the general guarantee and joint and several liability guarantee enjoys the right of defense of the debtor. If the debtor gives up the right to defend the debt, the guarantor still has the right to defend.
The right of defense refers to the right of the debtor to counteract the exercise of the creditor's claim based on legal causes when the creditor exercises the claim.
Section III Guarantee Liability
Article 21 The scope of the guarantee security includes the main claim and interest, liquidated damages, damages and expenses for realizing the claim. If otherwise agreed in the guarantee contract, it shall be in accordance with the agreement.
The parties have not agreed on the scope of the guarantee or the agreement is unclear, the guarantor shall be liable for all debts.
Article 22 of the guarantee period, the creditor assigns the main claim to a third party, the guarantor in the original guarantee within the scope of the guarantee shall continue to assume the responsibility for the guarantee. Guarantee contract otherwise agreed, in accordance with the agreement.
Article 23 of the guarantee period, the creditor permits the debtor to assign the debt, shall obtain the written consent of the guarantor, the guarantor of the debt transferred without its consent, no longer assume responsibility for the guarantee.
Article 24 of the creditor and the debtor agreement to change the main contract, shall obtain the written consent of the guarantor, without the written consent of the guarantor, the guarantor no longer assume responsibility for the guarantee. Guarantee contract otherwise agreed, in accordance with the agreement.
Article 25 of the general guarantee of the guarantor and the creditor did not agree to guarantee the period of time, the guarantee period of six months from the date of expiration of the main debt.
In the contractual guarantee period and the preceding paragraph of the guarantee period, the creditor has not filed a lawsuit against the debtor or apply for arbitration, the guarantor is exempted from the responsibility of the guarantee; the creditor has filed a lawsuit or apply for arbitration, the guarantee period of time for the interruption of the statute of limitations applies.
Article 26 The guarantor of the joint and several liability guarantee and the creditor did not agree on the guarantee period, the creditor has the right to request the guarantor to assume the guarantee responsibility within six months from the date of the expiration of the performance of the principal debt.
In the contractual guarantee period and the previous paragraph of the guarantee period, the creditor did not require the guarantor to assume the responsibility of the guarantee, the guarantor is exempted from the responsibility of the guarantee.
Article 27 If a guarantor makes a guarantee for successive claims in accordance with the provisions of Article 14 of this Law and does not agree on the guarantee period, the guarantor may terminate the guarantee contract at any time by notifying the creditor in writing, but the guarantor shall bear the guarantee responsibility for the claims incurred before the notification reaches the creditor.
Article 28 Where the same claim is secured both by guarantee and in rem, the guarantor shall bear the guarantee liability for the claim other than in rem.
Where the creditor waives the security in rem, the guarantor is exempted from the guarantee liability to the extent of the creditor's waiver.
Article 29 The branch of an enterprise legal person without the written authorization of the legal person or beyond the scope of authorization and the creditor to enter into a contract of guarantee, the contract is invalid or beyond the scope of authorization of the part is invalid, the creditor and the enterprise legal person is at fault, according to the fault of each shall bear the corresponding civil liability; creditor is not at fault, the enterprise shall bear the civil liability.
Article 30 The guarantor shall not be liable for any of the following cases:
(1) The parties to the main contract collude to trick the guarantor into providing the guarantee;
(2) The creditor of the main contract adopts fraudulent or coercive means to make the guarantor provide the guarantee in violation of the true meaning of the case.
Article 31 The guarantor shall have the right to recover from the debtor after assuming the responsibility of guarantee.
Article 32 After the people's court accepts the debtor's bankruptcy case, the creditor has not declared the claim, the guarantor can participate in the distribution of bankruptcy property and exercise the right of recovery in advance.
Chapter III Security
Section 1 Mortgage and Collateral
Article 33 The mortgage referred to in this Law means that the debtor or a third party does not transfer the possession of the property listed in Article 34 of this Law, and uses the property as a security for the claim. If the debtor fails to fulfill the debt, the creditor shall have the right to be compensated in priority by the property at a discount or by the price of the property sold at auction or on sale in accordance with the provisions of this Law.
The debtor or a third party under the preceding paragraph is the mortgagor, the creditor is the mortgagor, and the property providing the security is the collateral.
Article 34 The following properties may be mortgaged:
(1) houses and other aboveground fixtures owned by the mortgagor;
(2) machines, means of transportation and other properties owned by the mortgagor;
(3) state-owned land-use rights, houses and other aboveground fixtures which the mortgagor has the right to dispose of in accordance with law;
(4) State-owned machinery, means of transportation and other property which the mortgagor has the right to dispose of in accordance with law;
(v) land use rights of barren mountains, barren ditches, barren hills, barren beaches and other barren land contracted by the mortgagor in accordance with law and agreed to be mortgaged by the contracting party;
(vi) other property that can be mortgaged in accordance with law.
The mortgagor may mortgage the properties listed in the preceding paragraph together.
Article 35 The claims secured by a mortgagor shall not exceed the value of his collateral.
After the property is mortgaged, the portion of the value of the property that is greater than the balance of the secured claim may be re-mortgaged, but may not exceed the portion of its balance.
Article 36 Where a house on state-owned land acquired in accordance with law is mortgaged, the state-owned land use right within the area occupied by the house is mortgaged at the same time.
Where the state-owned land use right acquired by way of grant is mortgaged, the house on the state-owned land at the time of mortgage shall be mortgaged at the same time.
The land use right of a township (town) or village enterprise shall not be mortgaged separately. If a building such as a factory building of a township (township) or village enterprise is mortgaged, the land use right within its occupation shall be mortgaged at the same time.
Article 37 The following properties may not be mortgaged:
(1) land ownership;
(2) collectively-owned land use rights such as arable land, residence land, self-reserved land and self-reserved mountains, except for those stipulated in Paragraph (5) of Article 34 and Paragraph (3) of Article 36 of this Law;
(3) schools, kindergartens, hospitals, and other public welfare-oriented educational facilities, medical and health facilities and other facilities for public welfare of institutions and social organizations;
(4) property of which the ownership or right of use is unknown or disputed;
(5) property that has been seized, detained or supervised in accordance with the law;
(6) other property that may not be mortgaged in accordance with the law.
Section 2 Mortgage Contract and Registration of Mortgages
Article 38 The mortgagor and the mortgagee shall enter into a mortgage contract in writing.
Article 39 The mortgage contract shall include the following contents:
(1) the type and amount of the main claim to be secured;
(2) the period of time for the debtor to fulfill the debt;
(3) the name, quantity, quality, condition, location, ownership rights or right of use rights of the mortgaged property;
(4) the scope of the mortgage security;
(v) Other matters that the parties consider necessary to agree.
If the mortgage contract does not fully have the contents stipulated in the preceding paragraph, it can be corrected.
Article 40 When concluding a mortgage contract, the mortgagee and the mortgagor shall not agree in the contract that the ownership of the mortgaged property shall be transferred to the creditor in the event that the mortgagee is not satisfied at the expiration of the period for the performance of the debt.
Article 41 Where the parties pledge the property specified in Article 42 of this Law, the mortgage shall be registered, and the mortgage contract shall take effect from the date of registration.
Article 42 The departments responsible for the registration of mortgages shall be as follows:
(1) Where a mortgage is made on the right to use land without any ground attachment, the land administration department which issues the certificate of the right to use land;
(2) Where a mortgage is made on urban real estate or on buildings such as plant buildings of townships (townships) or villages enterprises, the department prescribed by the local people's government at or above the county level;
(iii) in the case of mortgages on forest trees, the department in charge of forest trees at or above the county level;
(iv) in the case of mortgages on aircraft, ships and vehicles, the registration department of the means of transportation;
(v) in the case of mortgages on equipment and other movable assets of an enterprise, the department of industrial and commercial administration of the place where the property is located.
Article 43 Where the parties pledge other property, they may voluntarily register the collateral, and the mortgage contract shall take effect from the date of its conclusion.
Where the parties have not registered the collateral, it shall not be used against third parties. If the parties register the collateral, the registration department shall be the notary public at the location of the mortgagor.
Article 44 For the registration of mortgages, the following documents or copies thereof shall be provided to the registration department:
(1) the main contract and the mortgage contract;
(2) the certificate of ownership or right of use of the mortgages.
Article 45 The information registered by the registration department shall be allowed to be inspected, transcribed or copied.
Section III Effectiveness of Mortgage
Article 46 The scope of mortgage security includes the main claim and interest, default, damages and expenses for realizing the mortgage right. If otherwise agreed in the mortgage contract, it shall be in accordance with the agreement.
Article 47 If the debtor fails to fulfill the debt upon the expiration of the period for the performance of the debt and the mortgage is seized by the people's court according to law, the mortgagee is entitled to collect the natural fruits separated from the mortgage as well as the legal fruits that the mortgagor can collect in respect of the mortgage from the date of seizure. If the mortgagor fails to notify the obligor who should pay the legal fruits of the fact of seizure of the collateral, the mortgage right shall not be as effective as the fruits.
The fruits of the preceding paragraph shall first be set off against the cost of collecting them.
Article 48 If the mortgagor mortgages the leased property, he shall inform the lessee in writing that the original lease contract shall continue to be effective.
Article 49 During the period of mortgage, the mortgagor who transfers the registered mortgage shall notify the mortgagee and inform the transferee that the transferred property has been mortgaged; if the mortgagor fails to notify the mortgagor or fails to inform the transferee, the transfer shall be invalid.
If the price of the transferred collateral is obviously lower than its value, the mortgagee may require the mortgagor to provide corresponding security; if the mortgagor fails to do so, the collateral may not be transferred.
The price received by the mortgagor from the assignment of the collateral shall be paid to the mortgagor in advance of the settlement of the secured claim or deposited with a third person agreed with the mortgagor. The portion in excess of the amount of the claim shall go to the mortgagor and the shortfall shall be satisfied by the debtor.
Article 50 A mortgage may not be assigned separately from the claim or used as security for other claims.
Article 51 If the mortgagor's acts are sufficient to reduce the value of the mortgage, the mortgagee shall have the right to require the mortgagor to cease his acts. When the value of the collateral is reduced, the mortgagee has the right to require the mortgagor to restore the value of the collateral or to provide security equivalent to the reduced value.
If the mortgagor is not at fault for the reduction in the value of the collateral, the mortgagee may demand security only to the extent of the compensation received by the mortgagor for the damage. The undiminished value of the collateral remains as security for the claim.
Article 52 A mortgage exists simultaneously with the claim it secures, and if the claim is extinguished, the mortgage is also extinguished.
Section IV: Realization of Mortgage
Article 53 If the mortgagee is not paid at the expiration of the period for the performance of the debt, he may agree with the mortgagor to be compensated by a discount on the mortgage or by the price obtained from the auction or sale of the mortgage; if the agreement fails, the mortgagor may bring a lawsuit in the People's Court.
After the mortgage is discounted or auctioned or sold, the portion of the price in excess of the amount of the claim shall belong to the mortgagor, and the shortfall shall be satisfied by the debtor.
Article 54 Where the same property is mortgaged to more than two creditors, the price derived from the auction or sale of the mortgages shall be paid off in accordance with the following provisions:
(1) Where the mortgage contract takes effect by registration, it shall be paid off in accordance with the order in which the mortgages have been registered; if the order is the same, it shall be paid off proportionately to the claims;
(2) Where the mortgage contract takes effect from the date of the mortgage contract that has been has been registered, it shall be satisfied in accordance with the provisions of item (a) of this Article; if it has not been registered, it shall be satisfied in accordance with the order of the time when the contract enters into force; if the order is the same, it shall be satisfied in proportion to the claims. The registered collateral is paid before the unregistered one.
Article 55 After the signing of a mortgage contract on urban real estate, the new houses on the land are not part of the mortgage. If the mortgaged real estate needs to be auctioned, the newly added houses on the land may be auctioned together with the mortgages in accordance with the law, but the mortgagee shall not be entitled to receive the proceeds of the auction of the newly added houses in preference to the mortgages.
Where the land use right of contracted wasteland is mortgaged in accordance with the provisions of this Law, or where the land use right is mortgaged within the area occupied by plants and other buildings of township (township) or village enterprises, the collective ownership of the land and the use of the land shall not be altered without legal procedures after the realization of the mortgage right.
Article 56: The mortgagee shall have the right of first refusal to pay the price obtained from the auction of the allocated state-owned land use right after paying the amount equal to the land use right premium payable in accordance with the law.
Article 57 A third party who secures a mortgage for the debtor shall have the right to recover from the debtor after the mortgagee realizes the mortgage right.
Article 58 The mortgage right is extinguished by the loss of the mortgage. The compensation derived from the extinction shall be treated as the mortgaged property.
Section V Maximum Mortgage
Article 59 The maximum mortgage referred to in this Law refers to the agreement between the mortgagor and the mortgagee to use the mortgage to secure, within the limit of the maximum amount of the claim, the consecutive claims occurring within a certain period of time.
Article 60 A borrowing contract may be accompanied by a maximum amount mortgage contract.
Contracts concluded between a creditor and a debtor in respect of a commodity for which transactions occur continuously within a certain period of time may be accompanied by a maximum amount mortgage contract.
Article 61 The main contractual claim of the maximum amount mortgage is not assignable.
Article 62 The maximum amount mortgage is subject to the other provisions of this Chapter in addition to the provisions of this Section.
Chapter IV Pledges
Section I Pledge of Movable Assets
Article 63 The pledge of movable assets referred to in this Law means that the debtor or a third person transfers his movable assets to the possession of the creditor to use the movable assets as a security for the claim. If the debtor fails to fulfill the debt, the creditor shall have the right to be compensated in preference to the price of the movable property at a discount or at the price of the movable property at auction or sale in accordance with the provisions of this Law.
The debtor or a third party as stipulated in the preceding paragraph is the pledgor, the creditor is the pledgee, and the transferred movable property is the pledge.
Article 64 The grantor and the pledgee shall conclude a pledge contract in writing.
The pledge contract shall come into effect when the pledge is transferred to the possession of the pledgee.
Article 65 The pledge contract shall include the following contents:
(1) the type and amount of the main claim secured;
(2) the period of time within which the debtor is to fulfill the debt;
(3) the name, quantity, quality and condition of the pledge;
(4) the scope of the pledge;
(5) the time of the transfer of the pledge;
(vi) other matters that the parties consider necessary to agree.
If the pledge contract does not fully have the contents stipulated in the preceding paragraph, it may be corrected.
Article 66 The grantor and the pledgee shall not agree in the contract that the ownership of the pledge shall be transferred to the pledgee in the event that the pledgee is not satisfied at the expiration of the period of performance of the debt.
Article 67 The scope of the pledge security includes the main claim and interest, default, damages, the cost of custody of the pledge and the cost of realizing the pledge. If otherwise agreed in the pledge contract, it shall be in accordance with the agreement.
Article 68 The pledgee shall have the right to collect the fruits arising from the pledge. If otherwise agreed in the pledge contract, it shall be in accordance with the agreement.
The fruits of the preceding paragraph shall be offset against the expenses of collecting the fruits.
Article 69 The pledgee has the obligation to keep the pledge properly. If the pledge is lost or damaged due to improper storage, the pledgee shall bear civil liability.
If the pledgor fails to take proper care of the pledge, which may lead to its loss or destruction, the pledgor may request the pledgor to deposit the pledge, or request the early settlement of the claim and return the pledge.
Article 70 If a pledge is damaged or its value is significantly reduced, which is sufficient to jeopardize the rights of the pledgee, the pledgee may require the grantor to provide corresponding security. If the pledgor fails to do so, the pledgor may auction or sell the pledge and agree with the pledgor to use the proceeds of the auction or sale for the early settlement of the secured claims or to deposit with a third party as agreed with the pledgor.
Seventy-one of the debtor to fulfill the debt at the end of the debt performance period, or the pledgee to pay off the secured claims in advance, the pledgee shall return the pledge.
The expiration of the debt is not satisfied, the pledgee may agree with the pledgee to the pledge discount, may also be sold at auction, sell the pledge according to law.
After discounting or auctioning or selling the pledge, the part of the price exceeding the amount of the claim shall belong to the pledgor and the part of the price which is insufficient shall be paid by the debtor.
Article 72 A third party who pledges security for the debtor shall have the right to recover from the debtor after the pledgee realizes the pledge.
Article 73 The right of pledge is extinguished by the loss of the pledge. The compensation derived from the loss shall be treated as the pledged property.
Article 74 The right of pledge exists concurrently with the claim secured by it, and if the claim is extinguished, the right of pledge is also extinguished.
Section II Pledge of Rights
Article 75 The following rights may be pledged:
(1) bills of exchange, checks, promissory notes, bonds, certificates of deposit, warehouse receipts, bills of lading;
(2) shares and stocks transferable in accordance with the law;
(3) the exclusive right to use trademarks, patents, and property rights in copyrights transferable in accordance with the law;
(iv) other rights that can be pledged by law.
Article 76 If a pledge is made by a bill of exchange, check, promissory note, bond, certificate of deposit, warehouse receipt or bill of lading, the documents of rights shall be delivered to the pledgee within the period agreed in the contract. The pledge contract shall take effect from the date of delivery of the documents of rights.
Article 77 If a bill of exchange, check, promissory note, bond, certificate of deposit, warehouse receipt or bill of lading is pledged with the date of encashment or withdrawal, and the date of encashment or withdrawal of the bill of exchange, check, promissory note, bond, certificate of deposit, warehouse receipt or bill of lading precedes the period for the fulfillment of the debt, the pledgee may encash or withdraw the goods before the expiration of the period for the fulfillment of the debt, and agrees with the pledgor that the price of the encashment or the withdrawn goods shall be used to Early settlement of the secured claims or to the third party agreed with the pledgor to deposit.
Article 78 Where a pledge is made of shares which are legally transferable, the pledgee and the pledgor shall enter into a written contract and register the pledge with the securities registrar. The pledge contract shall take effect from the date of registration.
The stocks shall not be transferred after they are pledged, but they may be transferred with the consent of the pledgor and the pledgee. The price obtained by the transfer of the shares by the grantor shall be paid to the pledgee in advance of the settlement of the secured claims or deposited with a third party agreed with the pledgee.
The pledge of shares of a limited liability company, the relevant provisions of the Company Law shall apply to the transfer of shares. The pledge contract takes effect from the date when the pledge of shares is recorded in the register of shareholders.
Article 79 of the law can be transferred to the exclusive right to trademarks, patents, copyrights in the property rights of the pledge, the pledgor and the pledgee shall enter into a written contract, and its management for the registration of the pledge. The pledge contract shall take effect from the date of registration.
Article 80 After the pledge of the rights provided for in Article 79 of this Law, the pledgor shall not transfer or license others to use, but the pledgor and the pledgee can be transferred or licensed to others by the consent of the negotiation. The transfer fee or license fee received by the pledgor shall be paid to the pledgee in advance of the settlement of the secured claim or deposited with the third party agreed with the pledgee.
Article 81 A pledge of rights shall be subject to the provisions of Section 1 of this Chapter in addition to the provisions of this Section.
Chapter V Lien
Article 82 The lien referred to in this Law means that in accordance with the provisions of Article 84 of this Law, where the creditor takes possession of the movable property of the debtor in accordance with the contract, and the debtor fails to perform the debt in accordance with the time limit agreed upon in the contract, the creditor has the right to place a lien on the property in accordance with the provisions of this Law, and to receive compensation in preference to the discounted value of the property, or to the price at which it was sold at auction or on liquidation.
Article 83 The scope of the lien security includes the main claim and interest, liquidated damages, damages, costs of custody of the lien and costs of realizing the right of lien.
Article 84 The creditor has a right of lien if the debtor fails to fulfill the debt in respect of a claim arising out of a custody contract, a transportation contract or a processing and contracting contract.
The provisions of the preceding paragraph shall apply to other contracts for which the law provides that a lien may be placed.
The parties may agree in the contract on the things that may not be liened.
Article 85 If the property subject to lien is divisible, the value of the lien shall be equal to the amount of the debt.
Article 86 The lienholder has the obligation to keep the lien properly. If the lien is lost or damaged due to improper custody, the lienholder shall bear civil liability.
Article 87 The creditor and the debtor shall agree in the contract that after the creditor liens the property, the debtor shall fulfill the debt within a period of not less than two months. If the creditor and the debtor have not agreed in the contract, after the creditor has liened the debtor's property, the creditor shall fix a period of not less than two months and notify the debtor to fulfill the debt within that period.
The debtor overdue still does not fulfill, the creditor may agree with the debtor to lien the property at a discount, but also can be sold by auction, sale of lien according to law.
After the lien is discounted or auctioned or sold, the part of the price exceeding the amount of the claim shall belong to the debtor, and the shortfall shall be settled by the debtor.
Article 88 The right of retention is extinguished for the following reasons:
(1) if the claim is extinguished;
(2) if the debtor provides a separate guarantee and it is accepted by the creditor.
Chapter VI Deposits
Article 89 The parties may agree that one party shall pay a deposit to the other as security for the claim. After the debtor has performed the obligation, the deposit shall be set off against the price or recovered. If the party who paid the deposit fails to fulfill the agreed debt, he shall not be entitled to the return of the deposit; if the party who received the deposit fails to fulfill the agreed debt, the deposit shall be doubled.
Article 90 deposit shall be agreed in writing. The parties in the deposit contract shall agree on the period of delivery of the deposit. The deposit contract shall take effect from the date of actual delivery of the deposit.
Article 91 The amount of the deposit shall be agreed by the parties, but shall not exceed twenty percent of the subject matter of the main contract.
Chapter VII Supplementary Provisions
Article 92 The real estate referred to in this Law refers to the land as well as houses, forests and trees, and other aboveground possessions.
The movable property referred to in this Law means objects other than immovable property.
Article 93 The guarantee contract, mortgage contract, pledge contract and deposit contract referred to in this Law may be a separate written contract, including letters and faxes between the parties with the nature of guarantee, or a guarantee clause in the main contract.
Article 94 The discount or sale of mortgages, pledges and liens shall be made with reference to the market price.
Article 95 If the Maritime Law and other laws have special provisions on guarantee, they shall be in accordance with their provisions.
Article 96 This Law shall come into force on October 1, 1995, as of the same date.