What Is a Court Bond?

The auction deposit is generated by an agreement between the parties to the auction. Since the auction is an anonymous transaction, the auctioneer invites foreign investors in its own name, issues announcements, displays, conducts the auction, and signs with the buyer in its own name Confirmation of auction transaction. There is no contractual relationship between the bidder and the client. Therefore, the auction deposit is a form of guarantee provided by the bidder or buyer to the auctioneer. As the auction is a civil act between equal subjects, the parties to a civil event may not violate the compulsory provisions of laws and regulations and the public order and customs, unless the law clearly stipulates them. Under the premise, freely agree each other's civil rights and obligations. Whether or not a security deposit is collected in the auction can be agreed between the auctioneer and the bidder according to the actual situation. The security deposit does not fall within the scope of the adjustment of the guarantee law, but is a non-governmental agreement, and the law generally recognizes the validity of this agreement.

Auction Margin

Right!

The auction deposit is generated by an agreement between the parties to the auction. Since the auction is an anonymous transaction, the auctioneer invites foreign investors in its own name, issues announcements, displays, conducts the auction, and signs with the buyer in its own name Confirmation of auction transaction. There is no contractual relationship between the bidder and the client. Therefore, the auction deposit is a form of guarantee provided by the bidder or buyer to the auctioneer. As the auction is a civil act between equal subjects, the parties to a civil event may not violate the compulsory provisions of laws and regulations and the public order and customs, unless the law clearly stipulates them. Under the premise, freely agree each other's civil rights and obligations. Whether or not a security deposit is collected in the auction can be agreed between the auctioneer and the bidder according to the actual situation. The security deposit does not fall within the scope of the adjustment of the guarantee law, but is a non-governmental agreement, and the law generally recognizes the validity of this agreement.

Auction margin usually consists of two parts, namely bidding margin and transaction margin. But in practice people rarely distinguish them, which should not be done. ^[1]

1. Collection of margin ^[1]

Whether the auction deposit has a deposit penalty function and whether the deposit can be automatically converted into a deposit after the auction is completed are also two common problems in auction practice. ^[2]

The so-called deposit refers to a certain amount of money or other substitutes that a party to a contract pays to the other party in order to guarantee the performance of its debts. According to Article 89 of the Security Law and Article 115 of the Contract Law, the parties may agree that one party shall pay a deposit to the other party as security for the creditor's right. After the debtor performs its debt, the deposit shall be offset against the price or recovered. If the party that pays the deposit fails to perform the agreed debt, 'there is no right to demand the return of the deposit; if the party receiving the deposit does not perform the agreed debt, the deposit shall be doubled. It can be seen that the deposit is one of the guarantee methods.

The bidding deposit in the auction cannot of course be regarded as a deposit. If the parties do not explicitly agree, after the auction is concluded, the bidding deposit cannot be automatically converted into a deposit. Article 118 of the Supreme People's Court's Interpretation of Several Issues concerning the Application of the (Guarantee Law of the People's Republic of China) stipulates that: "If the parties pay liens, guarantees, guarantees, contracts, deposits or deposits, etc., but do not agree on the nature of the deposit, If the parties claim the right to a deposit, the people's court will not support it. "It can be seen that the deposit rule cannot be automatically applied when a party to the contract breaches the contract. If there is an agreement between the two parties, after the auction is concluded, the bidding deposit may be converted into performance deposit according to the parties' agreement. It should be noted that the deposit must not exceed 20% of the subject contract amount.