Business and Commerce
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Scenario 2

Mr. A bought a brand XYZ car for his personal use from his own funds from a car dealer for RMB55,200. The car dealer issued two invoices (neither of which carried the chop of the car trading market management department of the relevant local administration of industry and commerce), a quality inspection certificate and a temporary car registration licence.

Driving the car home, Mr. A found some serious problems with it. He telephoned the car dealer the next day. On the following day, Mr. A drove the car to the appointed service centre of brand XYZ for inspection and repair. Two days later the service centre reported that the car was not manufactured by the XYZ automobile company.

Mr. A asked the car dealer to take back the car, refund the amount that he had paid, reimburse him for the inspection and repair fee of RMB928 and pay damages of RMB55,200 in accordance with the PRC Consumer Rights Protection Law《中華人民共和國消費者權益保護法》. Can the car dealer take the car back after refunding the amount that was paid by Mr. A and reimbursing the inspection and repair fee, and also to treat the rights and obligations of both parties in respect of the sale and purchase of the car as settled given that Mr. A has not suffered any loss?

Answer

A car is now considered to be a consumable good in Mainland China, and thus Mr. A falls into the category of consumer. This means that the PRC Consumer Rights Protection Law applies to this case, which overrides the relevant stipulation in the PRC Civil Code《中華人民共和國民法通則》and its various judicial interpretations by the Supreme People’s Court that relate to damages from the fraudulent supply of goods or services. The PRC Consumer Rights Protection Law states that if fraud has been committed in the provision of a product or service by the seller, then the seller must pay compensation that is equivalent to the price of the product or service upon the request of the consumer. Therefore, the car dealer must refund Mr. A the price of the car and further pay RMB 55,200 in compensation.

Mr. A is also entitled to be reimbursed for any other reasonable expenses that he incurred in the process of making his claim (including any legal costs and travelling expenses).

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