The influence and consequence of contract discharge in China’s Civil Code

With the rapid development of the world economy, China is becoming a key player in global trade and investment processes. Developing and updating legal rules governing contractual relations plays an important role in ensuring transparency, stability, and fairness in the business environment. Thus, the main purpose of this study was to identify the existing problems in the laws governing the process of contract cancellation and to make recommendations to improve the relevant aspects. In the course of the research, the legal method and the method of comparison were applied. As a result, the main procedures and grounds provided by the Civil Code of the People’s Republic of China for the termination of contractual obligations were identified. It was learnt that parties can terminate a contract in case of material breach of the terms of the agreement, which includes default, exceeding deadlines or changing circumstances that significantly affect the performance of the contract. The study also identified specific challenges that actors face when terminating contracts. Such as the unpredictability of the legal consequences of excluding a party from a contractual relationship, which can pose serious economic risks. The impact of factors such as economic crises on the termination of contractual obligations was also emphasised in the findings of the study. An important conclusion was the need to improve the legislation in the field of contract termination. The results of the study can be used to improve the law on contract termination in China, which can be the basis for developing clearer and more adaptive rules, thereby reducing possible legal risks for the business community