In November 2024, China’s Supreme People’s Court (SPC) issued the “Guiding Opinions on Further Regulating the Work of Online Judicial Auctions” (关于进一步规范网络司法拍卖工作的指导意见, hereinafter the “Opinions”), aiming to improve enforcement procedures for online judicial auctions and protect the legitimate rights and interests of the parties.
Seven years ago, the SPC launched its online judicial auction system and promoted it nationwide. By the end of October 2024, courts at all levels nationwide had conducted 9,734,700 online auctions, with a total transaction value of CNY 2.94 trillion and a turnover rate of 63.72%. Compared with traditional commissioned auctions, this system has saved the parties CNY 89.701 billion in commission fees.
The Opinions consists of 12 articles covering various stages of the auction process, including pre-auction property investigation and valuation, price adjustments during auctions, and the supervision of auction management.
The highlights of the Opinions are as follows.
- The auction property information should be truthfully disclosed. For real estate auctions, the enforcement courts shall disclose the usage and possession status of the property in auction announcements. Terms such as “unknown possession” or “occupied by others” should not be used in the auction announcements.
- It improves the mechanism of self-disposal by the judgment debtor. If the judgment debtor offers to sell the auctioned property at a price higher than the failed auction price, the enforcement court may approve this upon review and temporarily suspend other procedures, such as offsetting debts with the property or allowing third-party purchases. The self-disposal period is set by the court based on the property condition and market trends, and generally does not exceed 60 days.
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Contributors: CJO Staff Contributors Team
