Regulations of Shenzhen Special Economic Zone on Business

Chapter VII Agents

Article 51 The agent is an independent merchant who is authorized to act regularly or continuously on behalf of other merchants or help to bring about deals between its consigner and other merchants.

The agent, who is authorized to conduct business within the Special Zone by the consigner, is called a regional agent.

The agent, who is authorized to exclusively conduct business within the Special Zone by the consigner, is called an exclusive agent.

Article 52 To act on behalf of other merchants or helps to bring about deals between its consigner and other merchants, the agent shall conclude an agency contract with the consigner, or else the acts of the agent shall be subject to relevant provisions of the civil law.

Where the expired original agency contract between the agent and the consigner has not been renewed and has been further performed by the two parties, such contract shall be deemed as being changed into a casual one. Any of the parties may terminate the casual contract after notifying the other party for 30 days ahead of the termination, unless the parties have agreed otherwise.

The aforesaid paragraph of this article shall not be applicable in case the contract terminated due to gross negligence of any party or force majeure.

Article 53 The agent shall fulfill the obligations according to the agency contract and defend the interests of the consigner, while the consigner shall provide the necessary conditions for the agent to fulfill such obligations. To help to bring about deals between the consigner and other merchants, both the agent and the consigner shall bear the obligation to provide each other with relevant information in time.

Article 54 Unless otherwise specifically restricted by an agency contract, the agent may simultaneously accept authorizations from two or more consigners or conduct the business involving competition with the consigners.

Article 55 The agent shall bear the obligation of not taking advantage of or disclosing any commercial secrets of the consigners to any third party, even though the agency contract is terminated.

Article 56  The agent and the consigner may conclude an agreement at the time terminating the agency relations, under which restricts the agent from conducting the same business as that of the consigner within a reasonable time limit, i.e., the time limit may not exceed two years from the date terminating the agency relations. In this respect, the agent may request the consigner to pay for reasonable compensation.

The agent shall be forfeited of the right to claim for compensation stipulated in the aforesaid paragraph of this article in case the agency contract terminated due to gross negligence of the agent.

Article 57 The consigner shall pay corresponding remuneration for the agent as agreed under the agency contract. Where there is no such definite agreement in the contract on remuneration, the agent shall be entitled to acquire a reasonable sum of remuneration for the actual provision of services within the scope of authorization according to the business practice.

Article 58 Where any transaction fails due to the consigner’s fault or default while the agent has provided services for it, the agent shall be entitled to claim for reasonable remuneration from the consigner.

Article 59 Where any bargain is closed due to the service provided by a former agent within 6 months from the date rescinding the agency contract, unless otherwise the rescission due to the faults of the agent, the agent shall be entitled to claim for remuneration resulted from such transactions.

Article 60 Where the consigner closes any bargain within the agency area coverage of any regional agent, the regional agent shall be entitled to claim for the remuneration from the consigner regardless his presence or not in the transaction.

Article 61 The rescission of any agency contract shall be subject to the provisions of the contract law.

Article 62 Where any agent enjoys the creditor’s right for its agency or contributory in the conclusion of transaction but without being discharged of debts by the consigner within the time limit of payment, the goods or securities of the consigner may be kept by the agent unless otherwise agreed by both parties or prohibited to be kept by law.

Chapter VIII Supplementary Provisions

Article 63 The provisions concerning shop names, managers, publication of commercial registration and business account books in these regulations shall not be applicable to any individual businesses.

Article 64The detailed implementing measures are to be formulated by the Municipal Government in accordance with these regulations.

Article 65These regulations shall take effect as of October 1, 1999.

(This English version is only for reference. To learn more, please refer to the authoritative Chinese version.

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