Commercial Lease Agreement

A Commercial Lease Agreement in China is a legally binding contract that formalizes the rental of commercial property between a Lessor and a business Lessee. The property can include office spaces, retail stores, or industrial facilities. This agreement outlines essential terms such as rental payments, lease duration, property use, and rights and responsibilities of both parties. If you are looking to rent out residential property such as a house or apartment in China, you can refer to our Lease Agreement.

This agreement plays a vital role in ensuring business stability and legal compliance under Chinese property and contract law. Properly drafted agreements minimize disputes and help both landlords and lessees maintain smooth operations.

A well-drafted Commercial Lease Agreement in China typically includes the following essential clauses:

Under Chinese law, the maximum term for a Commercial Lease Agreement is 20 years. Any lease exceeding this period is legally invalid. Both parties can agree to renew the lease upon its expiration, but registration with the local property authority within 30 days is mandatory to maintain its legal validity.

Rent is typically negotiated in CNY and may be subject to periodic adjustments based on lease agreements. Landlords may request payments on a monthly, quarterly, or annual basis.

A security deposit is usually capped at three months’ rent under Chinese tenancy regulations. This deposit is refundable after lease termination, subject to any outstanding liabilities, damages, or penalties.

Yes, foreign companies registered in China can legally enter into a Commercial Lease Agreement. They must comply with the same legal and tax obligations as domestic businesses. To ensure clarity, it is advisable to use a lease agreement that includes certified translations in both English and Mandarin. For guidelines on foreign business operations in China, refer to the China Foreign Investment Information Portal.

Yes, registering a Commercial Lease Agreement is required by Chinese law. The registration must be completed within 30 days of signing the contract at the local property registration office. Proper registration protects the rights of both parties and ensures the lease is enforceable in legal disputes.  Failure to register may result in penalties and may undermine the enforceability of the agreement in court.

If either party violates key terms, such as non-payment or illegal property use, early termination is possible.

Both parties can mutually agree to terminate the lease before its expiration.

If the property is requisitioned for public purposes, termination may be mandatory.

Termination must comply with Chinese property laws and usually involves a formal notice period.
Following these guidelines ensures that early termination is legally valid and minimizes disputes.

A well-structured Commercial Lease Agreement is essential for protecting your business interests and ensuring compliance with China’s legal framework. It provides clear guidelines on rent payments, lease duration, security deposits, and the responsibilities of both landlords and lessees, reducing the risk of disputes. With China’s dynamic commercial landscape, having a legally sound lease agreement is critical for long-term business stability. Download our editable Commercial Lease Agreement template, compliant with Chinese law and available in both English and Mandarin so you can secure your commercial property with confidence.