[Direct answer]In the Beijing area, the risk of damage or loss of the subject matter during the period of deposit shall be borne by the creditor, and has nothing to do with the debtor. According to Article 573 of the Civil Code of the People's Republic of China, after the subject matter is deposited, the risk of damage or loss shall be borne by the creditor. The interest accrued during the period of deposit shall belong to the creditor, and the deposit expenses shall be borne by the creditor. In other words, from the moment of legal deposit, the debtor shall no longer bear the responsibility of custody and risk for the subject matter. Any subsequent depreciation or damage to the goods shall not be attributable to the debtor. However, the prerequisite are that the deposit meets the statutory conditions and procedures, and the deposited items are indeed the subject matter stipulated in the contract. For more details, please refer to the following link:Business and contract dispute services for enterprises.

I. Problem background and typical scenarios

Once the goods are deposited, who will be responsible for their storage and who will bear the losses if they are damaged often becomes a lingering dispute. Typical scenarios include: perishable fresh produce spoiling during storage, with the creditor claiming that the seller is responsible; market price fluctuations causing the deposited goods to depreciate, with the buyer demanding that the seller compensate for the price difference; theft, fire, and other accidents occurring during storage, with both parties shifting blame to each other; and disputes over the ownership of the accrued interest and rent on the deposited goods. Many debtors worry: once the goods are handed over to the notary office, will I still have to compensate if something goes wrong? The law clearly stipulates that the risk transfers upon the deposit. For cases involving the delivery and storage of goods, the following provisions may be referred to for reference:Real estate sales and construction project servicesOther performance guarantee arrangements besides the above-mentioned ones.

II. Key points of contention

The focus of the controversy lies in three aspects. Firstly, the timing of risk transfer: the risk may still be borne by the debtor before the completion of legal deposit (when the notary agency accepts and controls the subject matter). Secondly, whether the deposit is appropriate: if the subject matter deposited does not meet the agreement, is short in quantity, or has been previously damaged, the risk may not be completely transferred, and the debtor may still be responsible for the defects. Thirdly, the ownership of interest and expenses: according to Article 573, the interest belongs to the creditor and the expenses belong to the creditor, which is consistent with the logic of risk transfer. When handling similar cases in Beijing, the court generally adopts a clear division of responsibility for the custody of the deposit notarization certificate, but will still review the evidence of the state of the subject matter at the time of deposit. For cases involving storage custody responsibilities, reference can be made to the relevant provisions of the Contract Law of the People's Republic of China.Creditor-debtor relations and enforcement case services.

III. Professional analysis by Hengluo Lawyers

Based on our practical experience in handling deposits and contract performance disputes, the controversy over risk assumption often arises from the "evidence of the deposit time". Hengluo Lawyers usually advise clients to: record the status of the subject matter before the deposit (photos, videos, quality inspections, and notarized inventories) to clarify the product name, quantity, quality, and defects at the time of delivery, making the risk transfer boundary clear and verifiable; choose a notarized or warehousing institution with storage conditions at the time of deposit and obtain a notarized certificate and receipt. In practice, if the debtor can prove that the goods were intact and the procedure was compliant at the time of deposit, the subsequent damage and loss will generally be borne by the creditor. For easily depreciating goods, lawyers will also advise the creditor to pick them up in a timely manner in the deposit notice to avoid expanding losses due to delayed acceptance and backfiring on themselves. For cross-border and special goods, it can be combined with other measures to ensure the safety of the goods during the deposit process.\nFinancial capital and cross-border services involving foreign countriesEvaluate the storage standards.

IV. Practical suggestions and legal basis

The core basis is Article 570 (legal circumstances for deposit), Article 571 (deposit procedure), Article 573 (effect of deposit: risks, accrued interests, and expenses shall belong to the creditor, and the debt shall be extinguished), and Article 574 (receipt and five-year exclusion period) of the Civil Code of the People's Republic of China (effective January 1, 2021); and with reference to the rules on deposit notarization and custody in the Notarization Law. Practical suggestions: Fix the evidence of the subject matter's condition before deposit to avoid "depositing with hidden defects"; deposit with a qualified institution and obtain a certificate; notify the creditor and prompt them to pick up the deposit promptly after deposit; and retain the expense receipts for recovering the expenses from the creditor. For deposits of money or negotiable securities, they can be combined with other relevant provisions.Intellectual property protection and corporate legal servicesEvaluate the implementation structure.

5. Henglu Law Firm's Advice

The transfer of risks with the deposit is a legal protection for parties who perform their obligations in good faith, but the prerequisite for such protection are a "clean deposit": the subject matter must be appropriate, the timing must be clear, and the evidence must be complete. Never deposit goods that have been damaged or do not meet the contractual requirements, otherwise, the risks and responsibilities may still remain with you. It is recommended to keep good records of the condition of the goods before and after the deposit, which not only protects yourself but also reduces future disputes with creditors. If the creditor retracts his/her claim regarding the ownership of the damaged goods, you should defend your position with the notarized certificate and the inventory records. For those who need professional supervision, you can seek help from professionals.Special services and other case servicesIn case of complex situations, please consult a practicing lawyer as soon as possible.

VI. Frequently Asked Questions

Q1: If the goods are damaged after being deposited, can the creditor still ask me to compensate them?

It's not allowed by law. According to Article 573 of the Civil Code, the risk of damage or loss of the subject matter after it is deposited shall be borne by the creditor. From the moment the legal deposit is completed, the debtor shall be relieved of the risk responsibility. However, the prerequisite are that the deposit is carried out in accordance with legal procedures, and the subject matter deposited meets the contractual requirements and does not have any undisclosed defects. If you deposit goods that are damaged or do not meet the contractual requirements, the risk may not be transferred, and you may still be responsible for the defects. In practice, the inventory records and notarization certificates at the time of deposit are key to determining responsibility. It is recommended to leave sufficient evidence of the condition of the goods before depositing them to prevent the other party from reneging on their obligations.

Q2: If I claim that the risk has been transferred, what evidence do I need to keep?

The core elements include: the deposit certificate and receipt issued by the notary office; a record of the condition of the subject matter at the time of deposit (photos, videos, quality inspection reports, inventory lists); evidence proving that the goods were properly prepared before deposit and that the debtor was duly notified to claim the goods; a record of notifying the creditor after deposit; and the deposit fee receipt. The materials should be organized around the "time of deposit, intact condition of the subject matter, and compliance with procedures", ensuring that in the event of a dispute, it can be proven that the risk has been transferred to the creditor upon completion of the deposit.

Q3: Who is responsible for the custody fees and accrued interest during the escrow period?

According to Article 573 of the Civil Code, the accrued interests during the deposit period (such as rent, interest, and natural accrued interests) belong to the creditor, and the deposit fees (notarization fees, storage fees, transportation fees, etc.) shall be borne by the creditor. In other words, after the deposit, not only the risk is transferred, but also the gains and costs are transferred to the creditor. You can recover the expenses you have paid from the creditor with the bills or deduct them in the settlement. It is recommended to ask the institution about the rules of charging and handling accrued interests when depositing, and to write them into the notice to avoid future disputes over the ownership of the gains.

Q4: How long does it take from the completion of the escrow to the complete removal of the risk?

The transfer of risk occurs at the moment when the legal deposit is completed (the notary office accepts and actually controls the subject matter), and it does not require a long period. It should be noted that the creditor's right to collect the deposit will be extinguished if it is not exercised within five years from the date of deposit. After five years, the deposited items will belong to the state. It usually takes several days to several weeks from the preparation of the supporting documents to the issuance of the notarial certificate, depending on the completeness of the materials and the schedule of the institution. Once the notarial certificate is issued and the subject matter is delivered for storage, the risk will be disconnected, and the debtor will no longer need to worry about subsequent damage.

Q5: I want to make sure that the risk will not be mine after the deposit is made. What should I do first?

It is recommended to proceed in four steps: First, make a complete record (photos, videos, quality inspections, and inventories) of the name, quantity, quality, and defects of the target items before depositing them, to ensure a "clean deposit"; Second, apply to a qualified notary agency for the deposit, and obtain a notarial certificate and a receipt; Third, notify the creditor of the deposit fact in accordance with the law and remind them to pick it up in time, and keep the delivery receipt; Fourth, keep all expense receipts and legally claim the right to restrict and offset the creditor's overdue debts. For reference only.The official website of Beijing Henglu Law FirmFor further guidance, you may hire a lawyer to assist you throughout the entire process, if necessary.

This article is written based on the common judicial interpretations in the Beijing area. If the case occurs in other regions, it is recommended to consult local lawyers to verify the regional differences.

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

Disclaimer: This article is compiled based on the current laws and regulations and publicly available 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. In the event of a dispute, please consult a practicing lawyer in a timely manner.