On The Legal Effect Of The Preemptive Right Of Lessees

The preemptive right of lessees refers to a privilege which is granted by law or contract that the citizen or corporatate as a lessee may purchase the lease in advance of the third of same conditions when the lessor decide to sell any lease. Chinese laws and regulations define that only the house tenancy subject to the preemptive right of lessees, however, lessees of the other objects can also have the preemption by achieving a agreement. The nature of the lessee preemption is not a right of formation or a right of additional formation, the preemptive right of lessees is an vested right. The preemptive right of lessees came into being when the lessor sold the object, and once it came into being, it is enforceable. By analyzing the function of the rights and the right remedy, we can't define the preemptive right of lessees as a real rights, it just a right of claim. If lease contract was registered, it could be used to against the third party, or just acquire effect of obligation. The legal effect of the preemptive right of lessees is mainly reflected in both Internal effect and external effect. The preemptive right with the nature of the effect of obligation only possess a internal effect and can only be used to pursuit the liability for breach of contract. But if lease contract was registered, the preemptive right possess the external effect, so, it could be used to against the third party, can nullifying its registration, to acquiring the ownership of object. Because the seller could form several legal relationship with many different people on a same object. So, there could be some conflicts between several preemptions that they are on the same objects. Such as the conflict between the preemptive right of lessees and co-owners, as well as the the conflict between the preemptive right of lessees. There is a principal when accomplishing the interest of joint possession. Between lessees and co-owners, no matter mutually-shared or shared on common, the co-owners have the right of preemption. When there are several lessees, preemption shall be exercised in accordance with the agreement among the lessees, or, in consideration of making good use of the object. But as to the preemption of lessees and the preemption of underleasee, underleasee have the right of preemption.