Is “Pay When Paid” article valid?
The “Pay When Paid” (hereinafter referred to as the “PWP”) clause usually applied in the chain contracts. The typical feature of PWP is that there are two contracts, a party sets the payment of the upstream party as the precondition for the payment to the downstream party. Such clause could help the party to reduce risks related to the payment, which is widely used in contracts such as construction, advertising, technical services, bulk cargo transactions and so on. However, the validity of such clause is not clearly defined in the current laws, so it is impossible to affirm such clause…