On May 9, 2007, the French food group Danone filed eight arbitration claims against its Chinese partner Wahaha at the Stockholm Chamber of Commerce. On September 30, 2009, the two sides announced a settlement. Danone sold its 51 percent stake in their joint ventures for 3 billion yuan and left Wahaha.
Wahaha’s founder Zong Qinghou later said that the company had not understood what trademarks and brands meant, so that its growth “fell into a trap carefully laid by Danone.”
饿死不讨米，屈死不告状 Starve to death rather than beg for rice. Die wronged rather than file a lawsuit.
衙门口，朝南开，有理没钱莫进来 The yamen gate faces south. With reason but no money, do not come in.
A columnist cited both old sayings in 2024 to explain a long fear of the cost and the unfairness of going to court.
In November 2024, an email reported to come from BYD’s passenger car division asked suppliers to cut prices by 10 percent from January 1, 2025.
Li Yunfei, BYD’s head of brand and public relations, answered that “annual price negotiation with suppliers is an industry practice.” He said the 10 percent target was “not compulsory” and “negotiable.” The report put the industry’s usual annual cut at about 5 percent.
Chinese suppliers announce price rises to their customers with a 涨价函, a price increase letter. When chip prices rose at the end of 2020, the chip maker Huiding (Goodix) raised its dollar prices by 30 percent from January 1, 2021. Xinjieneng (NCE Power) told customers that the new prices would also apply to unpaid orders already in its system.
Article 533 of China’s Civil Code covers a contract whose basic conditions change in a major way that the parties could not foresee and that is not a commercial risk. If continued performance would be clearly unfair to one party, “the party adversely affected may renegotiate with the other party.” Only if they fail to agree within a reasonable time may either party ask a court or an arbitration body to change or end the contract.
In one reported case, a court refused a request for higher rent based on rising prices.
In April 2020, the Supreme People’s Court issued guidance on civil cases related to the epidemic. Where the epidemic or the measures against it only made a contract harder to perform, “the parties may renegotiate. Where performance can continue, the people’s courts shall strengthen mediation and actively guide the parties to continue performing.”
The same guidance said that courts would not support a request to end a contract only because performance had become difficult.
In Ming and Qing land sales, a seller could come back after the sale and ask the buyer for more money. The custom was called 找价, “seeking the price,” or 加找. A seller could claim that “the price was not enough.” The historian Cao Shuji found that after the Qianlong era, 加找 became a standard contract form.
A 2012 study in the law journal The Jurist cites the finding that repeated 找价, even after a deed of final sale, was “a very common custom.” Qing law later limited it. Where a deed of final sale did not mention extra payments, none were allowed.
On June 30, 2017, foreign ministry spokesperson Lu Kang said of the 1984 Sino-British Joint Declaration on Hong Kong: “As a historical document, it no longer has any practical significance. It is not binding in any way on the central government’s administration of the Hong Kong Special Administrative Region.”
A spokesperson of the British Foreign Office replied that the Declaration “remains as valid today as when it was signed over thirty years ago. It is a legally binding treaty, registered with the UN, and continues to be in force.”
In September 2017, Xu Hong, head of the Chinese foreign ministry’s department of treaty and law, said that China had never denied that the Declaration is an agreement.
In January 2019, a judge reviewed the book 情理法与中国人 (Feeling, Reason, Law and the Chinese) in a piece published by the Supreme People’s Court. She summed up the book’s view: “In the eyes of the Chinese, to accord with feeling comes first, to accord with reason second, and to accord with law third.”
She also defended the saying 法不容情, “the law makes no room for feeling.” It means, she wrote, that a judge must not bring private feeling into a case.
变通 To adapt. To act according to the actual situation, not bound by convention. The word is old. The Book of Changes says: “Nothing changes and gets through more than the four seasons.”
通融 To make an exception for someone. To stretch the rules as a favor.
合情合理 To accord with feeling and with reason. The everyday word for “reasonable.”