The COVID-19 is raging, and various regions have taken different closure and control measures, and closure and control have also had an impact on the signing of contracts between enterprises. In general, when a contract is concluded in the form of a contract, both parties need to sign, seal, or fingerprint the contract. During the pandemic, affected by containment measures, the parties to the contract may not be able to sign the same contract. If one party signs and seals the contract and sends the scanned copy to the other party by email, and the other party signs and seals the scanned copy before sending it back by email, is the contract concluded in this way valid?

1、 Relevant provisions of laws and regulations

Article 471 of the Civil Code stipulates: "The parties may enter into a contract by offer, acceptance, or other means." Article 483 stipulates: "The contract is formed when the acceptance takes effect, except as otherwise provided by law or agreed by the parties." Article 502 stipulates: "A contract formed in accordance with the law becomes effective upon its formation, except as otherwise provided by law or agreed by the parties." According to the above provisions, a contract is concluded in the form of an offer or acceptance. The contract is formed when the acceptance becomes effective, and a legally established contract becomes effective upon its formation.

Article 469 of the Civil Code stipulates the form of contract formation: "The parties may enter into a contract in written, oral, or other forms. Written forms are forms of contract, letter, telegram, telex, fax, and other forms that can tangibly express the content contained therein. Data messages that can be tangibly expressed through electronic data interchange, e-mail, and other means, and that can be accessed at any time for reference, are considered to be in written form.", Signing a contract in writing includes fax, email, and other methods.

Article 490 of the Civil Code stipulates that: "If a party concludes a contract in the form of a written contract, the contract is formed from the time when both parties sign, affix their seals, or affix their fingerprints. Before signing, affixing their seals, or affix their fingerprints, one party has performed its main obligations, and the other party accepts it, the contract is formed. Laws, administrative regulations, or the parties agree that the contract should be concluded in writing. If the parties do not adopt a written form, but one party has performed its main obligations, the other party accepts it." "Upon receipt, the contract is established." According to the above provisions, if a contract is concluded in the form of a contract, the contract is formed when both parties sign, affix their seals, or affix their fingerprints. However, on the premise that one party has fulfilled its main obligations and the other party accepts it, even if the contract is not signed, affixed their seals, or affixed their fingerprints in accordance with the provisions of laws and regulations or the agreement of the parties, the contract is also formed.

According to the aforementioned legal provisions, a contract is established upon the effective date of the commitment, and contracts expressed by fax, email, etc. are also considered to be in writing. "If both parties have completed the offer and acceptance, and there are no other situations where the contract is invalid, the contract signed in such forms shall be valid.". "Even if there are certain formal flaws in the signing of the contract, if one party has fulfilled its main obligations and the other party accepts them, the provisions of Article 490 of the Civil Code can be applied to determine that the contract is established and takes effect.".

2、 Judgment viewpoints in judicial cases

1. Case 1: Sales Contract Dispute between Jiangsu Anatec Energy Service Co., Ltd. and Shanghai Duli Electric Technology Co., Ltd. [(2021) Su 05 Min Zhong No. 418]
In this case, both parties affixed their official seals and signed a contract in the form of scanned copies, resulting in disputes over whether the contract was established. Anatec believes that in order to cooperate with Duli's internal processes, Anatec sent a scanned copy of the seal, but the original contract with the seal was not formed between the two parties from the beginning, so the contract was not formed from the beginning. Even if the contract is deemed to be established, according to the contract agreement, the condition for the contract to take effect is to sign and seal. However, in fact, the contract does not have an original copy sealed by both parties at the same time, so it does not meet the effective requirements stipulated in the contract. Duli Company believes that sending the contract involved to the legal representative of Anatec Company via email has constituted an offer, and Anatec Company has affixed a special seal for the contract and sent it back to Duli Company, which constitutes an acceptance of the offer, so the contract has been established in accordance with the law.
The Intermediate People's Court of Suzhou City, Jiangsu Province, made the following judgment: In this case, Duli Company sent the "Industrial Product Sales Contract" to Anatec Company, and Anatec Company sealed it and sent it back to Duli Company. This behavior indicates that it has made an acceptance on the offer to enter into the contract, and the parties reached an agreement on the conclusion of the industrial product sales contract. Anatec claims that its stamping behavior is only for the purpose of cooperating with Duli Company to complete internal processes, lacking evidence, and this court does not support it. Secondly, regarding the validity of contracts, according to legal provisions, contracts established in accordance with the law take effect from the time they are established.

2. Case 2: Sales Contract Dispute between Dongguan Qiyi Machinery Co., Ltd. and Beijing Jiaheng Shengtai Mold Co., Ltd. [(2016) Yue 19 Min Zhong No. 12]

In this case, both parties agreed in the "Return Agreement" that the fax and the copy have the same legal effect. Under the agreement, "Party B" bears the signature and seal of the plaintiff Dongguan Qiyi Machinery Co., Ltd. for confirmation, and "Party A" bears the red seal and signature of the defendant "Beijing Jiaheng Shengtai Mold Co., Ltd.". The plaintiff claims that the "Return Agreement" is signed and sealed by the defendant, scanned and faxed to the plaintiff, and the plaintiff seals the scanned copy for confirmation.

The court of first instance held that the "Return Agreement" clearly stated that "faxes and photocopies have the same legal effect", and that the content of the "Return Agreement" can be verified by the content of the "Equipment Purchase and Sales Contract" submitted by the plaintiff. Therefore, in the absence of a defense by the defendant, the authenticity of the "Return Agreement" was accepted. The court of second instance held that the contract involved in the case was a true expression of intent by both parties, the content of which did not violate mandatory provisions of laws and administrative regulations, and was legal and effective. Both parties should perform their rights and obligations in accordance with the agreement.

3. Case 3: Sales Contract Dispute between Shanghai Taichao Electromechanical Technology Co., Ltd. and Detong (Lianjiang) Metal Container Co., Ltd. [(2014) RMZZ No. 2095]

In this case, the appellant, Shanghai Taichao Electromechanical Technology Co., Ltd., and the respondent, Detong (Lianjiang) Metal Container Co., Ltd., discussed the purchase of equipment by email. The appellant replied to the appellant in an email on September 17, 2012, stating, "Please affix your seal and scan your response, and upon receiving the scan, we will immediately ship the goods. Two copies of the original contract will be sent by express mail." After receiving the email, the appellant replied, "The contract has been received, and it will be signed and sent back to you in the afternoon. Please be sure to deliver the goods today." Since then, the appellant has not returned a stamped and scanned copy of the contract text to the appellant. ". In September 2012, the appellee received the litigation equipment delivered by the appellant, and in October 2012, the appellee began trial production of the equipment. In November 2012, the appellee paid 150000 yuan.

The court held that the email sent by the appellant and the text of the "Purchase and Sales Contract" attached thereto fully indicated the intention to conclude a contract with the appellant, and its content was specific and clear, consistent with the legal provisions of the offer. The respondent's reply "Please make sure to deliver the goods today" is a manifestation of his intention to accept the appellant's offer. After receiving the offer, he did not return a sealed scanned copy of the contract text as required by the appellant, but did not make any substantive changes to the subject matter, quantity, quality, price, and performance method of the contract. Therefore, this commitment is valid. By the time the commitment reaches the appellant, the "Purchase and Sales Contract" has been established and takes effect, and is legally binding on both parties.

According to the above case, the main criteria for establishing a contract are the offer and acceptance of both parties. If both parties have completed the contract signing process of the offer and acceptance, signing the contract by fax or email does not affect the effectiveness of the contract.

3、 Evidence of contract conclusion can be retained through video or notarization

Although according to the law, email and fax can be used as a form of written contract, and there are also precedents supporting them in judicial decisions, considering the burden of proof in the event of disputes, it is still recommended to retain relevant evidence of the conclusion of the contract through video or notarization and witness by a third-party institution such as a notary institution.
We have noted that the "Typical Cases of Public Legal Services for Epidemic Prevention and Control and Enterprise Resumption" released by the Ministry of Justice contain cases where notarization agencies assist in remote video notarization and other signing contracts for reference. An excerpt of one typical case is as follows:

Company A, a well-known catering chain enterprise in Shanghai, was unable to operate normally due to the COVID-19, and urgently needed a loan of 5 million yuan from Bank D. Also affected by the epidemic, the two guarantors B and C of the loan are located in Yunnan Province and a certain place in the United States, respectively, and cannot go to Bank D to sign the relevant guarantee contract and a series of materials in person in the short term. In this special situation, Bank D hopes that a notary office in Shanghai will provide legal support, which can not only help enterprises overcome difficulties as soon as possible, but also properly implement the necessary risk control procedures to ensure the safety of bank credit funds.

The notary in charge of a notary office in Shanghai believes that the process of signing the guarantee contract and relevant materials by the relevant parties can be notarized through remote video to preserve evidence, balancing the urgent practical needs of the parties and the risk control management of the bank. At 12:00 noon on February 22, 2020, the undertaking notary and the staff came to Bank D together, and the entrusted agent of Bank D and the legal representative of Company A conducted a remote video call with the guarantors B and C through WeChat video call. The entrusted agent of Bank D completed the verification of relevant materials through remote video. The guarantors B and C in the video screen signed their names on each page of the guarantee contract, and displayed the signed page to the entrusted agent of Bank D. During this process, the entrusted agent of Bank D used a mobile phone to take screenshots, and the undertaking notary and staff were present throughout the process and recorded the actions of the above personnel. On February 24th, a notary office in Shanghai issued a notarial certificate, and the notarization of the preservation evidence was successfully completed.

4、 Conclusion

The containment measures during the epidemic have had a certain impact on the signing of contracts between enterprises. Signing contracts through email, fax, and other forms is a temporary alternative to maintaining the normal development of various businesses under the containment measures. When adopting this scheme, it is recommended to properly preserve the corresponding evidence during the contract signing process or adopt measures such as notarization and witness, and try to obtain the original contract as much as possible after the closure measures are lifted.