Research On The Legal Effect Of Contract Against Mandatory Provision

In PRC legal system, there lies Clause 5 in Article 52 of Contract Law which says"the contract which violates the mandatory provision of law or administrative regulations is invalid". However, different individuals has got different interpretations and applications of that certain clause. Thus, what we should do first is to make it clear that which is the most proper interpretation of the implication of mandatory provision ,and that the contract legal effect accordingly. This paper is focused on the contract effect when the contract violates the mandatory provision of law or administrative regulations.The PRC Contract Law has paid attention to the limitation of the certain layers of statutes in avoiding the unrestrained invalid contract. In the year of 2009, Article 14 of The Interpretation II of the Supreme People's Court of Several Issues concerning the Application of the Contract Law of the People's Republic of China has said that the term"mandatory provisions"as mentioned in subparagraph 5 of Article 52 of the Contract Law refers to the mandatory provisions on effectiveness. This interpretation has shown that we have essentially recognized the relation between mandatory provision and the effect of contract. Because when we do research on the definition and classification of the core concept"mandatory provision", we found that there exist four kinds of mandatory provisions named"the mandatory provisions on effectiveness"\"reine Ordnungsvorschrift"\"gew?hrende Rechtsnormen"\"Bestimmungss?tze". Only when violating the mandatory provisions on effectiveness, a contract would be invalid, or we may say it is like an Illegal Agreement in Anglo-American Law of Contracts.That the contract is to be invalid for its violating the law or administrative regulations is the principle. However, under certain circumstance, the contract could be valid or partly void as exceptions.