Administrative Measures on Lawyers’ Fee Charging Behaviors
by
The National Development and Reform Commission and the Ministry of Justice
Article 1 These Measures are formulated pursuant to the Pricing Law, the Lawyers Law, and related laws and regulations for the purposes of standardizing fee charging for lawyer services, protecting the legitimate rights and interests of clients and lawyers, and promoting the healthy development of the legal industry.
Article 2 These Measures shall apply to the collection of legal fees by law firms established pursuant to the Lawyers Law of the People’s Republic of China and practicing lawyers approved to practice pursuant to the Law of the People’s Republic of China on Lawyers.
Article 3 Fees for lawyer services shall be charged by complying with the principles of transparency, fairness, voluntary participation, compensation, honesty, and trustworthiness.
Law firms shall provide services to facilitate and serve the people’s well-being, strengthen internal management, reduce service costs and provide high-quality legal services to their clients.
Article 4 Fees for lawyer services shall be charged on government-guided prices or market-regulated prices.
Article 5 Law firms shall charge government-guided prices for the provision of the following legal services:
(1) representation in civil litigation cases;
(II) representation in administrative litigation cases;
(III) representation in state compensation cases;
(IV) the provision of legal advice to criminal suspects involved in criminal cases, representation in appeals and charges, application for bail; representation of defendants or private prosecutors, representation of victims;
(V) representation in appeals in various litigation cases.
Law firms shall charge market-regulated prices for the provision of other legal services.
Article 6 The benchmark price and floating range of the government-guided price shall be formulated by the competent pricing department of the people’s government of each province, autonomous region, and municipality directly under the Central Government in conjunction with the judicial administrative department at the same level.
Article 7 When the government sets prices for lawyers’ services, it should listen to the opinions of all sectors of society and a hearing may be carried out when necessary.
Article 8 The government should set the lawyer service prices by fully considering the local economic development level, people’s capacity to pay, and the long-term development of the law industry. The price should be composed of lawyers’ costs for providing services, reasonable profit, and legal taxes.
Article 9 The fees for lawyer services subject to market regulation shall be determined through consultation between the law firm and the client.
The following main factors shall be considered when a law firm negotiates with a client about the lawyer service fee:
(I) time spent on the case;
(II) The complexity of legal affairs;
(III) The client’s ability to pay;
(IV) The risks and responsibilities that the lawyer may assume;
(V) The social reputation and professional skills of the lawyer.
Article 10 Lawyers’ service charges may be charged in different ways based on different service contents, such as charging by the case, charges in proportion to the involved amount, and hourly charges.
Charging by the case is generally applicable to legal matters that do not involve property relations;
Pro-rata fee charging applies to legal matters involving property relations;
Hourly fee rate may apply to all legal matters.
Article 11 When handling a civil case involving property relations, if the client still requests to implement a contingent fee after being informed of the government-guided price, the law firm may implement the contingent fee rate, except for the following circumstances:
(I) Marriage and inheritance cases;
(II) Requesting social insurance benefits or minimum living security benefits;
(III) Requesting payment of alimony, maintenance fee, support payment, pension, relief money, or compensation for work-related injuries;
(IV) Requesting payment of labor remuneration, etc.
Article 12 Contingent fees are prohibited from being used in criminal litigation cases, administrative litigation cases, state compensation cases, and group litigation cases.
Article 13 To implement the contingent fee rate, a law firm shall sign a contingent fee contract with the client, stipulating the responsibility, charge method, charge amount, or proportion for each party to take.
When the contingent fee is implemented, the maximum fee amount shall not be higher than 30% of the target amount agreed in the fee contract.
Article 14 Law firms shall strictly implement the administrative measures and fee rates for lawyer services formulated by the pricing administration authorities and the judicial authorities of the counterpart level.
Article 15 Law firms shall announce the administrative measures and fee rates, etc, for lawyer services and accept social supervision.
Article 16 A law firm accepting an engagement shall enter into a fee contract for lawyer services with the client or include a fee clause in the engagement contract.
A fee contract or fee clause shall include: fee items, fee rates, fee collection method, fee amount, payment and settlement method, dispute resolution method, etc.
Article 17 Upon execution of a fee contract with the client, the law firm shall not unilaterally alter the fee items or raise the fee amount. Where an alteration is necessary, the law firm shall obtain the prior written consent of the client.
Article 18 Law firms shall present legal invoices to their clients when collecting legal service fees from them.
Article 19 Litigation fees, arbitration fees, authentication fees, notary fees, and search fees paid by a law firm on behalf of a client in the course of the provision of legal services shall not be part of the legal service fee and shall be paid by the client separately.
Article 20 Where a law firm needs to collect in advance traveling expenses for working on a case at a different location, it shall provide an estimate of the expenses to the client and both parties shall sign and confirm the expenses upon negotiation. Where there is a need to alter the estimate of the expenses, the law firm shall obtain the prior written consent of the client.
Article 21 A law firm shall provide a list of out-of-pocket expenses incurred on behalf of the client and traveling expenses for working on a case at a different location and valid vouchers to the client for settlement of the relevant expenses stipulated in Article 18 and Article 19. The client may refuse to make payment for the portion for which the law firm is unable to provide valid vouchers.
Article 22 Law firms shall collect lawyer’s service fees, out-of-pocket expenses incurred on behalf of the client, and traveling expenses for working on a case at a different location on a unified basis. Lawyers shall not collect any fees from clients on their own.
Except for the three types of fees stipulated in the preceding paragraph, law firms and lawyers handling the cases shall not collect any other fees from clients on any other pretext.
Article 23 A law firm shall accept the legal aid cases assigned to it. No fee shall be collected from aided persons for handling legal aid cases.
Law firms may, at their discretion, reduce or waive their lawyer’s service fee for citizens with genuine financial difficulties while failing to satisfy the criteria for legal aid.
Article 24 Branches of law firms established at a different location shall implement the fee-charging standards of the place of the branch office.
Article 25 Law firms providing legal services at a different location may implement the fee-charging standards at the location of the law firm or at the place of provision of legal services, with the detailed rules to be negotiated and determined by the law firm and the client.
Article 26 The pricing administration authorities at all levels shall strengthen supervision and inspection of fee-charging behaviors of the law firms.
The government pricing administration authorities shall impose administrative punishment pursuant to the Pricing Law and the Provisions on Administrative Punishment for Illegal Pricing Acts on law firms and lawyers guilty of any of the following illegal pricing acts:
(I) failure to announce administrative measures and fee rates for lawyer services pursuant to the provisions;
(II) implementation of government-guided prices ahead or behind the time limit;
(III) charging beyond the scope or range of government-guided prices;
(IV) raising fee rates in disguised form by dividing fee items into several of them, repetitively charging fees, expanding the scope of fee-charging, etc.;
(V) carrying out the unfair competition by charging fees that are evidently below cost;
(VI) any other illegal pricing acts.
Article 27 All levels of the judicial administration authorities shall strengthen supervision and inspection of legal services and activities of law firms and lawyers.
The judicial administration authorities shall impose administrative punishment pursuant to the Lawyers Law and the Measures on Punishment for Illegal Acts by Lawyers and Law Firms for the following illegal acts on the part of law firms and lawyers:
(I) violation of the provisions on acceptance of entrustment and execution of a written entrustment contract or fee contract by a law firm on a unified basis;
(II) violation of the provisions on the collection of lawyer service fees, out-of-pocket expenses incurred on behalf of clients, and traveling expenses by a law firm on a unified basis;
(III) failure to provide clients with an estimate of travel expenses for working on a case at a non-local place, failure to issue legitimate invoices for lawyer service fees, failure to provide clients with valid vouchers for expenses incurred on behalf of clients and travel expenses for working on a case at a non-local place;
(IV) violation of the provisions on safekeeping and use of special documents for lawyer services, financial notes, and business files by a law firm on a unified basis;
(V) any other acts in violation of the practice discipline and professional ethics of lawyers.
Article 28. Citizens, legal persons, and other organizations may report or complain of any violation of pricing provisions by law firms or lawyers to the pricing administration authorities, judicial administration authorities, or bar association through correspondence, telephone, or by visit, etc.
Article 29. The pricing administration authorities and judicial administration authorities of local people’s governments that formulate or adjust fee rates for lawyer services arbitrarily beyond the limit of authority shall be ordered by the higher-level pricing administration authorities or people’s government of counterpart level to make a correction; where the case is serious, the relevant authorities shall be requested to impose punishment on the persons accountable.
Article 30. Disputes over fees for lawyer services between law firms and their clients shall be negotiated and resolved between the law firm and the client. Where negotiation is unsuccessful, the dispute may be submitted to the bar association or the judicial administration authorities and pricing administration authorities at the location of the law firm for mediation; alternatively, the dispute may be submitted for arbitration or a lawsuit may be filed with a People’s Court.
Article 31. Measures for the mediation of disputes over legal services fees shall be formulated separately.
Article 32. The pricing administration authorities of the people’s governments of all provinces, autonomous regions, and centrally-administered municipalities and the judicial administration authorities of counterpart level shall formulate the detailed implementation measures for the administration of fees for lawyer services pursuant to these Measures and file the detailed implementation measures with the National Development and Reform Commission and the Ministry of Justice for the record.
Article 33. The National Development and Reform Commission and the Ministry of Justice shall be responsible for the interpretation of these Measures.
Article 34. These Measures shall be effective on 1 December 2006. At that time, the Notice of State Planning Commission and Ministry of Justice on Printing and Distribution of the “Provisional Measures on Administration of Fees for Lawyer Services” (Ji Jia Ge (1997) 286) and the Notice of State Planning Commission and Ministry of Justice on Provisional Standards for Fees for Lawyer Services to be Determined by Local Authorities (Ji Jia Fei (2000) 392) shall be repealed simultaneously.