On January 1, 2000, the "Procedures of the Municipality of Shanghai on the Mortgage of Real Estate" went into effect. These Procedures supplement the "Guaranty Law of the People's Republic of China" and are significant because they provide complete definitions for the regulation of real estate mortgages, including mortgage rights, contracts, registrations and all legal responsibilities associated therein.

These Procedures now make it much easier undertake or modify asset-backed mortgages, secure future construction rights, commodity purchase, notarization of a foreign-held real estate mortgage, payments, inheritances, transfers, etc.

Although mortgages are commonplace elsewhere, the concept is still somewhat less developed in China. The reason that these Shanghai Procedures are significant is because the legal guidelines to the various aspects of mortgages as set forth in these Shanghai Procedures are well thought-out and would therefore offer a good reference or blueprint for national legislation on the same topic.
　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　 -- Richard Song