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Provisions of the Shenzhen Special Economic Zone f
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 CHAPTER III IMPLEMENTATION OF A CONTRACT AND RESPONSIBILITY FOR
VIOLATION
 @@  Article  21.  The persons concerned of the two sides should
strictly abide  by  the provisions of the contract and implement all
obligations. Any side  which fails to implement the obligations and
therefore causes losses to the other side, should compensate for the
losses.
 In case of failing to deliver goods or pay funds on time, the liable
side, in  addition to compensating for the losses of the other side,
shall pay a charge for the violation of contract equal to 0.1 per
cent of the total overdue value for each overdue day.
 @@ Article 22. Two or more persons concerned of one side shall bear
joint rights  and  obligations. Any one of them has the right to
request  the  other  side  to  implement  all  or  part of the
obligations.  If one of the persons concerned  has accepted the
implementation of all or part of the obligations by the other side,
the  other persons lose all or part of their right of request; if any
one of them fails to implement his obligations, the others must
implement  all  the  obligations and bear the responsibility for
violation of the contract.
  @@  Article  23.  The  persons concerned of one side, after
implementing all or  part  of the obligations, may provisionally
stop implementing their obligations, have a lien upon properties of
the other side and claim for the losses, if the persons concerned
of the other side fail to implement all or part of the obligations.
 When  the persons concerned of one side fail to implement all or part
of the obligations, the persons concerned of the other side may defer
implementing their obligations and claim for the losses.
 When  the persons concerned of one side failing to implement
their obligations  have guaranteed to implement their obligations,
the persons concerned  of  the other side shall implement their
own obligations immediately.
 @@  Article 24. When persons concerned of one side fail to implement
all or part  of their obligations as a result of force majeure, they
should inform the other side of the fact in good time and shall
be excused from the liability for the violation of contract in
whole or part, if they have produced legally effective evidence.
Force majeure means:
1 Severe natural calamity;
2 War; and
 3  Other incidents beyond the control of the parties as specified
in the contract.
 @@  Article  25. When a contract has been confirmed to be entirely
invalid in the process of implementation, the whole contract shall be
cancelled.
 When the individual clauses of the contract which contravene the
laws, rules  and regulations of the People's Republic of China have
been cancelled or  modified with the consent of the persons concerned
through consultation, the force of the whole contract shall not be
affected.
 A  contract  which  is signed by means of deception or coercion
shall be confirmed invalid and the liable side shall compensate
for the losses arising therefrom.
CHAPTER IV MODIFICATION, CANCELLATION AND TERMINATION OF A CONTRACT
 @@  Article  26.  A contract shall be modified or cancelled upon
approval by the authorities of ratification due to one of the following
reasons:
 1  The  contract  shall  not be able to be implemented in whole or
part as a result of force majeure;
 2  The  persons  concerned of one side have lost actual ability to
implement the contract;
 3  The conditions for modification or cancellation as agreed upon
in the contract have emerged;
 4  The  violation  of  the  contract  by one side has seriously
affected the economic interests of the other side and has thus made
the implementation of the contract unnecessary; and
  5  The  persons concerned on all sides have agreed, through
consultation, to modify or terminate the contract because of the change
of the situation.
 @@  Article  27.  The  persons concerned who request to modify or
terminate the  contract  should submit an application and relevant
certificates to the authorities  of  ratification. If there is a
guarantor,  his  written document must  also  be  attached.  The
contract shall remain in force until the application is approved.
 The  liable  side  shall,  apart  from  being exempt from the
responsibility according  to  the  law,  pay  compensation for the
losses of the other side caused by the modification or termination.
 @@  Article  28.  If the persons concerned of one side desire to
transfer to other persons all or part of the rights and obligations
stipulated in the contract,  they  must  obtain the consent of the
other side beforehand, sign an agreement and submit an application to
the ratificati

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