In our country, every enterprise must have a clearly defined scope of business operations. This scope is generally confirmed by the business license issued by the industrial and commercial registration department. If an enterprise operates beyond the scope of business specified in the business license, it is called "exceeding the scope of operation". In 1999, Article 10 of the Supreme People's Court's "Interpretation on Several Issues Concerning the Application of the Contract Law" stipulated that "if parties enter into contracts beyond their scope of business, the people's courts shall not therefore determine that the contract is invalid. However, this does not apply if the operation violates national restrictions, special permits, or prohibitions under laws and administrative regulations." This regulation completely overturned the provisions of 1987. Except for businesses explicitly specified by the state as requiring approval procedures (such as real estate, tobacco, etc.) or those prohibited from operation, enterprises can directly engage in all projects without any approval. Since the old provisions have been abolished, when we now sign contracts, we no longer need to carefully review the other party's scope of business; we only need to ensure that the content of the contract does not violate national restrictions, special permits, or prohibitions under laws and administrative regulations.
(Reprints should indicate the source, thank you.)
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