Determination of the Validity of the "False One, Penalty Ten" Transaction Rule

Compiled from: China Court Network, other online public channels
 
[Case Details]
 
Zhang wanted to buy a laptop, so he went to a computer specialty store owned by Li. At the entrance of the store stood a notice that read “fake one, compensate ten.” Later, Zhang purchased a laptop worth 5,000 yuan in the store. After taking it home, he verified the anti-counterfeiting code online and, after appraisal by professionals, discovered that the computer was a counterfeit and shoddy product. Zhang then approached Li and demanded that he honor the “fake one, compensate ten” promise. Divergence arose over whether Li should fulfill the liability of “fake one, compensate ten.”

 
Disagreement
 
There are three opinions regarding whether Li should fulfill the "fake one, compensate ten" liability:
 
The first opinion holds that the "fake one, compensate ten" clause excessively increases Li's burden and constitutes an invalid standard term, so Li is not required to fulfill that promise.
 
The second opinion holds that the "fake one, compensate ten" promise was not incorporated into the contract and no mutual agreement was reached between the parties, and therefore the promise is not binding on Li.
 
The third opinion holds that "fake one, compensate ten" was a genuine promise voluntarily made by Li, representing his true expression of intent, and should be deemed valid, with Li being obligated to fulfill the "fake one, compensate ten" liability to Zhang.
 
[Author's View]
 
A merchant’s promise to “pay ten times the price for any counterfeit goods” constitutes a punitive liquidated damages clause between the merchant and the consumer. Once a transaction occurs between the consumer and the business operator, a sales contract is formed between the parties, and this promise, as one of the contractual terms, becomes legally binding.
 
This situation constitutes a unilateral promise by the merchant, an obligation the merchant has set for itself. Therefore, as long as it reflects the merchant’s true intent, it carries corresponding legal effect. If a customer indeed purchases counterfeit goods at the store, they may use this as grounds to demand that the merchant honor the promise of “tenfold compensation.”
 
However, the key in practice is to correctly grasp the meaning of "fake" in "fake one, penalty ten."
 
Generally speaking, whether goods are counterfeit depends on whether their quality, materials, and performance are consistent with what the merchant promised under the "fake one, compensate ten" commitment. Some goods also have industry-specific evaluation standards. If possible, consumers should request that the merchant provide a written explanation of the meaning of the commitment, so as to fully protect their lawful rights and interests.