Study On Compensation System For Pure Economic Losses

This article first analyzes the definition and legal characteristics of pureeconomic losses. Pure economic loss is a new type of loss that arises and attractspublic attentions due to the development of social life, implication of economicrelations and enhancement of social networking. It occurs without regard to personaldamage, tangible property losses or infringement on statutory rights.Secondly, given that pure economic loss is a legal concept stemming fromwestern countries, it is discovered through research on comparative law that differentcountries have their own attitudes and ways to perceive the compensation system forpure economic losses. However, the overall trend is the transition and developmentfrom absolute “no compensation” to reasonable compensation by way of legaltechniques.Lastly, in light of our country’s current legal practice and legislative situation,while there are no direct provisions on the compensation for pure economic losses inany existing laws, it is not uncommon in real legal practice where such issues aresolved by reference to the relevant provisions. In addition, the “General Principles ofCivil Law” and the “Torts Law” of our country does not exclude pure economiclosses from the scope of remedy. Nonetheless, with regard to the current situation, thecompensation system for pure economic losses in our country is scattered and there isno comprehensive system therefor. Therefore, there is a need for regulation andimprovement. After feasibility analysis, it is a relatively reasonable option to establisha compensation system for pure economic losses that adopts “Torts Law” as the core legislation supplemented by a) the rules in other laws and regulations, and b) reply onspecific cases and case guides issued by the Supreme Court. And this is an option thatfits current China’s national situation.Just as an old saying goes: If there are no interpretations in the law, there shouldbe no applications. Any legal department or jurisprudence study is established tobetter serve judicial practice and the construction of the socialist “rule of law”. Withthe improvement of civil legislations, Chinese legal system will face a new era on “thestudy of legal interpretation”. Especially, the “Torts Law” is a distinctive law withunique characteristics. It is a law with a good combination of general terms andspecific terms; the terms are all inter-related; the system is complex. As a result, therelations between different chapters and terms need to be continuously studied injudicial practice and during the application of the law. Thus, for a long going forwardwe need to work on dissemination and interpretation of the law in order to coordinatethe work of legislation and judicial institutions.