[Direct answer]In the Beijing area, contract review is a typical non-litigation legal service, which, together with litigation representation, is a fundamental part of corporate legal counsel services. When lawyers review contracts, they verify the qualifications of the contracting parties, the authenticity of their expressions of intent, and the legality of the contract content in accordance with Article 143 of the Civil Code of the People's Republic of China (effective January 1, 2021). Additionally, they refer to the provisions of Articles 500 and 501 regarding contractual fault and trade secret protection to propose amendments to the allocation of rights and obligations, breach of contract liability, and dispute resolution clauses, and issue a written review report. The cost of pre-review is far lower than that of litigation. Most contract disputes can be avoided through professional scrutiny before signing the contract. For referenceBusiness and contract disputes in enterprises.

I. Problem background and typical scenarios

This question is often encountered in several situations: First, the enterprise's legal department is understaffed, and it cannot distinguish between lawyers' litigation and non-litigation work; Second, operators believe that only when litigation is necessary do they hire lawyers, ignoring pre-transaction risk control; Third, it is necessary to distinguish between billing methods. Non-litigation cases are usually charged based on a fixed fee or an annual consulting fee, while litigation cases are usually charged based on the litigation object and litigation stages; Fourth, the enterprise intends to hire a long-term legal consultant and wants to confirm whether contract review is included in the service package. Many enterprises in Beijing have included contract review in their regular legal services packages and entrusted it to consultant lawyers together with employment and compliance matters. For daily legal affairs of the enterprise, you can also refer to it for reference.Intellectual property and corporate lawColumn.

II. Key points of contention

The disputes focus on five aspects. Firstly, the scope of the review. Lawyers are responsible for the legality and major risks, while the choice of commercial terms remains the decision of the enterprise. Secondly, the obligation to provide explanations on standard contract terms. If the provider fails to fulfill this obligation, the other party may claim that the term does not constitute part of the contract. Thirdly, the effectiveness review, which includes the qualifications of the parties, the authenticity of the expression of intent, and whether it violates mandatory provisions or public order and good customs. Fourthly, the obligation of confidentiality during the contract negotiation stage. Trade secrets obtained during the negotiation shall not be exempted from confidentiality obligations even if the contract is not concluded. Fifthly, the adoption of review opinions and the division of responsibilities. Specifically, the provisions shall be subject to the currently effective laws, regulations, and judicial rulings.

III. Professional analysis by Henglue Lawyers

Taking the cases handled by our firm as an example, we can see the value of pre-review. In a contract invalidation dispute handled by Attorney Xue Suhua, the client signed a "Beijing household registration marriage settlement agreement" with a third party and paid 100,000 yuan to obtain a Beijing household registration, but the registration failed and the client sued. The court ruled that the agreement violated public order and good customs by using false marriages to evade household registration policies, and was invalid from the outset according to Article 152 of the Civil Code. The court ordered the other party to return the 100,000 yuan and bear the case acceptance fees and announcement fees. If a professional effectiveness review had been conducted before signing the contract, such agreements that clearly violate public order and good customs should not have been signed, and financial losses could have been avoided. In another sales contract dispute handled by our firm's lawyers, the supplier sued for more than 8.35 million yuan in arrears and requested to exercise the mortgage right. The court reviewed and determined that the case involved fraud by a third party, and the public security organ had already initiated an investigation with suspected economic crimes. The court ruled to dismiss the suit and transfer the materials to the public security organ, confirming the indispensability of pre-verification of the transaction background and the qualifications of the counterparty. This case was handled by Beijing Henglu Law Firm.Xue SuhuaThe attorney (practice certificate number: 11101201211769926, subject to the certificate issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

Action suggestions: First, distinguish between non-litigation and litigation needs. Contract review and legal consultation belong to non-litigation, while dispute representation belongs to litigation. When entrusting, clarify the scope of services and billing; Second, when reviewing major contracts, provide background information and transaction purposes to facilitate lawyers' assessment of substantive risks; Third, implement review opinions, modify with traceability, and control versions; Fourth, assume confidentiality obligations for the other party's trade secrets learned during negotiations to avoid contractual fault liability; Fifth, legal advisors can be hired annually to institutionalize the contract review system. In terms of legal basis, Article 143 of the Civil Code of the People's Republic of China stipulates the effective elements of civil legal acts, Article 500 stipulates that parties who maliciously negotiate contracts under the pretext of concluding contracts or intentionally conceal important facts shall bear compensation liability for contractual faults, and Article 501 stipulates that parties shall not disclose or improperly use trade secrets learned during the contract negotiation process, regardless of whether the contract is established or not.

5. Henglu Law Firm's Advice

Risk Warning: Firstly, review cannot replace business judgment. Lawyer's opinion is a risk warning rather than a promise of profit; Secondly, superficial review, which only corrects typos, does not equal quality control. It is necessary to require the issuance of a written review report and explain the risks item by item; Thirdly, even when signing contracts urgently, at least the verification of the subject's qualifications and the bottom line of effectiveness should be completed; Fourthly, if the review opinion involves trade secrets, the enterprise itself should also manage them properly. It is recommended to make contract review an essential step in the enterprise's signing process, and you can consult for more information.Beijing Henglu Law FirmThe same category on the official website.

VI. Frequently Asked Questions

Q1: What is the relationship between contract review and non-litigation legal services?

Contract review is a typical form of non-litigation legal services. Non-litigation services include contract drafting and review, legal consultation, long-term legal advisory services, due diligence, negotiation accompaniment, etc. Litigation services refer to representing clients in court. Most of the daily legal needs of enterprises focus on the non-litigation stage. Conducting a thorough contract review can reduce litigation risks at the source. When entrusting legal services, it is necessary to clarify the service list, the form of legal opinions, and the billing method.

Q2: What are the main aspects to be reviewed during a contract review?

It usually includes: the subject's qualifications and performance capabilities, the signatory's authorization; the validity of the contract, whether it violates mandatory provisions or public order and good customs; whether the subject matter, price and payment method are clear; whether the rights and obligations are equivalent; whether the breach of contract liability, termination conditions, dispute resolution and service provisions are complete; whether there are clauses in the standard form that exempt the party's own responsibilities or increase the other party's responsibilities. The lawyer checks each item and issues written amendment opinions.

Q3: How much does it cost to hire a lawyer to review a contract?

The fees are usually charged on a per-document basis or included in the annual legal advisory fees, with prices fluctuating depending on the length of the contract, the complexity of the transaction, and the urgency of the matter. There is no standard pricing. The fees for a single ordinary commercial contract are relatively manageable, but they increase significantly for complex transactions involving equity, guarantees, or foreign affairs. Long-term cooperation is usually more cost-effective when packaged into an annual advisory fee. It is recommended to clarify your needs and the number of documents first before requesting a quote.

Q4: How long does it usually take to review a contract?

For regular contracts, it usually takes one to three working days to provide legal opinions. Complex transactions may require several days or even weeks, depending on the length of the contract, the depth of background checks, and the number of round-trip communications. For urgent transactions, clients can agree on an expedited deadline with lawyers, but compressing the process too quickly may lead to the omission of risk points. It is recommended to reserve sufficient review time for new contracts.

Q5: How should companies arrange contract reviews?

The first step is to sort out the types of business contracts and determine the list of contracts that must be reviewed, such as guarantees, large-scale procurement, and foreign investment contracts. The second step is to clarify the process: contracts that have not been reviewed by the manager in advance cannot be stamped. The third step is to choose either a review-by-share model or an annual consultant model. The fourth step is to establish a file of review opinions and revised versions. The fifth step is to regularly review the causes of disputes and revise the templates, which can be referred to for reference.Business and contract disputes in enterprises.

The above answer is based on the judicial practice in Beijing. The adjudication standards in other provinces and cities may vary. For specific cases, please refer to the local rules and evidence situation.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the relevant evidence, so as to avoid missing the statutory time limit. →Business and commercial legal services·Attorney Xue Suhua·Beijing Henglue Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.