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<P> （2） That the damage occurred outside the territorial limits provided by the insurance or guarantee， unless flight outside of such limits was caused by force majeure， assistance justified by the circumstances or an error in piloting， operation or navigation.</P>
<P> The continuation in force of the insurance and guarantee under the provisions of the preceding paragraph shall apply only for the benefit of he person suffering damage.</P>
<P> Article 168 Without prejudice to any right of direct action which the person suffering damage may have under the law governing the contract of insurance or guarantee， such person may bring a direct action against the insurer or guarantor only in the following cases：</P>
<P> （1） Where the insurance or guarantee is continued in force under the provisions of sub-paragraphs （1） and （2） of Article 167 of this Law； and</P>
<P> （2） The bankruptcy of the operator.</P>
<P> Excepting the defences specified in paragraph 1 of Article 167 of this Law， the insurer or guarantor may not， with respect to direct actions brought by the person suffering damage in accordance with the provisions of this Chapter， avail himself of any ground of nullity of the insurance or guarantee or any right of retroactive cancellation in setting up defences.</P>
<P> Article 169 If insurance or guarantee is furnished in accordance with Article 166 of this Law， it shall be specifically and preferentially assigned to payment of claims under this Chapter.</P>
<P> Article 170 Any sum due to an operator from an insurer shall be exempt from seizure and execution by creditors of the operator until claims of third parties under this Chapter have been satisfied.</P>
<P> Article 171 Actions concerning indemnity for damage to third parties on the surface shall be subject to a period of limitation of two years from the date of the incident which caused the damage； but in any case such period shall not go beyond a period of three years from the date of the incident which caused the damage.</P>
<P> Article 172 The provisions of this Chapter shall not apply to the following damage：</P>
<P> （1） The damage caused to a civil aircraft in flight， or to persons or cargo on board such aircraft；</P>
<P> （2） The damage which is regulated either by a contract between the person who suffers such damage and the operator or the person entitled to use the civil aircraft at the time the damage occurred， or by the law relating to workman's compensation applicable to a contract of employment between such persons； and</P>
<P> （3） Nuclear damage.</P>
<P> Chapter XIII Special Provisions Governing Foreign Civil Aircraft</P>
<P> Article 173 The provisions of this Chapter shall be applicable to foreign civil aircraft operated by foreigners and engaged in civil aviation activities in the territory of the People's Republic of China； where no provisions are available in this Chapter， other provisions concerned in this Law shall apply.</P>
<P> Article 174 A foreign civil aircraft may enter or leave the airspace of the People's Republic of China， and operate or land in the territory of the People's Republic of China only in accordance with the air transport agreement concluded between the Government of the People's Republic of China and the government of the State in which the aircraft is registered， or in accordance with the approval or clearance of the competent civil aviation authority under the State Council of the People's Republic of China.</P>
<P> If a foreign civil aircraft， not conforming to the provisions of the preceding paragraph， is entering or leaving the airspace of the People's Republic of China without authorization， the authorities concerned of t</P> he People's Republic of China have the right to take necessary measures to order the aircraft to land at a designated airport； if there is reasonable ground to deem that it is necessary to make an inspection of a foreign civil aircraft which operates in conformity with the provisions of the preceding paragraph， the authorities concerned have the right to order the aircraft to land at a designated airport.
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<P> Article 175 The operator of a foreign civil aircraft entering the airspace of the People's Republic of China shall furnish relevant certificate（s） to prove that he has been covered by insurance against liability for third parties on the surface， or obtained corresponding guarantee； where the operator fails to furnish the relevant certificate（s）， the competent civil aviation authority under the State Council of the People's Republic of China has the right to refuse him to operate into the airspace of the People's Republic of China.</P>
<P> Article 176 The operator of a foreign civil aircraft may operate the international scheduled air services specified in the air transport agreement concluded between the Government of the People's Republic of China and his own government only after he has been designated by his own government and obtained the operating licence issued by the competent civil aviation authority under the State Council of the People's Republic of China； the operator of a foreign civil aircraft may operate non-scheduled air transport between a place within the territory of the People's Republic of China and a place without said territory only after he has been approved by his own government and by the competent civil aviation authority under the State Council of the People's Republic of China.</P>
<P> The operator of foreign civil aircraft mentioned in the preceding paragraph shall， in accordance with the provisions of the laws and administrative rules and regulations of the People's Republic of China， formulate corresponding plan of security and submit it to the competent civil aviation authority under the State Council of the People's Republic of China for the record.</P>
<P> Article 177 No operator of foreign civil aircraft shall operate the air transport between two points in the People's Republic of China.</P>
<P> Article 178 The flight of a foreign civil aircraft shall be conducted in accordance with the timetable or flight plan approved by the competent civil aviation authority under the State Council of the People's Republic of China； approval of the competent civil aviation authority under the State Council of the People's Republic of China shall be obtained by the operator in respect of any change in timetable or flight plan； the operator shall report in time to the competent civil aviation authority under the State Council of the People's Republic of China in respect of any change or cancellation of flight.</P>
<P> Article 179 A foreign civil aircraft shall take off or land at a customs airport designated by the competent civil aviation authority under the State Council of the People's Republic of China.</P>
<P> Article 180 The competent civil aviation authority under the State Council of the People's Republic of China and other competent authorities shall have the right to inspect the documents specified in Article 90 of this Law of a foreign civil aircraft on its landing or departure.</P>
<P> Foreign civil aircraft and the persons， baggage and cargo carried therein shall be subject to entry， exit， customs， quarantine and other inspections exercised by the competent authorities concerned of the People's Republic of China according to law.</P>
<P> In exercising the inspections prescribed in the two preceding paragraphs， undue delay shall be prevented.</P>
<P> Article 181 The civi</P> l aircraft certificates of airworthiness and certificates of competency and licences of crew members issued or rendered valid by the State in which the nationality of a foreign civil aircraft is registered， shall be recognized as valid by the Government of the People's Republic of China， provided that the requirements under which such certificates or licences were issued or rendered valid shall be equal to or above the minimum standards established by the International Civil Aviation Organization.
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<P> Article 182 In the event that a foreign civil aircraft is in emergency within the search and rescue area of the People's Republic of China， the participation of its owner or of the State in which the nationality of the aircraft is registered shall be subject to the approval of the competent civil aviation authority under the State Council of the People's Republic of China or in accordance with the agreement between the governments of the two States.</P>
<P> Article 183 In the event of an accident occurred to a foreign civil aircraft in the territory of the People's Republic of China， the State in which the nationality of the aircraft is registered or other States concerned may appoint observers to take part in accident investigation. The report of accident investigation and findings in the matter shall be communicated by the competent civil aviation authority under the State Council of the People's Republic of China to the State in which the nationality of such civil aircraft is registered and other States concerned.</P>
<P> Chapter XIV Application of Law to Foreign-related Matters</P>
<P> Article 184 Where the provisions of an international treaty concluded or acceded to by the People's Republic of China are different from those of this Law， the provisions of that international treaty shall apply， except the provisions for which reservation has been declared by the People's Republic of China.</P>
<P> In respect of cases which are not provided by the law of the People's Republic of China or by the international treaties concluded or acceded to by the People's Republic of China， international practices may apply.</P>
<P> Article 185 The law of the State in which the nationality of a civil aircraft is registered shall be applicable to the acquisition， transference and extinction of the ownership of the civil aircraft.</P>
<P> Article 186 The law of the State in which the nationality of a civil aircraft is registered shall be applicable to the mortgage of the civil aircraft.</P>
<P> Article 187 The law of the location of the court which takes up the case shall be applicable to civil aviation liens.</P>
<P> Article 188 The parties to a contract of civil air transport may choose the law applicable to the contract unless otherwise provided by law. In case the parties to the contract have made no such choice， the law of the State most closely related to the contract shall apply.</P>
<P> Article 189 The law of the place where an act of tort occurred shall be applicable to indemnity for damage caused by a civil aircraft to third parties on the surface.</P>
<P> The law of the location of the court which takes up the case shall be applicable to the indemnity for damage caused by civil aircraft over the high seas to third parties on the surface.</P>
<P> Article 190 The application of foreign laws or international practices in accordance with the provisions of this Chapter shall in no way violate the public interest of the People's Republic of China.</P>
<P> Chapter XV Legal Liability</P>
<P> Article 191 Where a person seized an aircraft by violence， threats thereof or other means， his criminal responsibility shall be investigated in accordance with the Decision Regarding the Punishment of the Criminals Engaged in</P> Aircraft Hijacking.
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<P> Article 192 Where a person endangers flight safety by using violence against a person on board a civil aircraft in flight， but without resulting in serious consequences， his criminal responsibility shall be investigated in accordance with the provisions of Article 105 of the Criminal Law； if grave consequences result from such act， his criminal responsibility shall be investigated in accordance with the provisions of Article 106 of the Criminal Law.</P>
<P> Article 193 A person who， in violation of the provisions of this Law， conceals and brings explosives， detonators or other dangerous articles while flying in a civil aircraft， or consigns dangerous articles for shipment under the name of non-dangerous articles， but without resulting in serious consequences， shall be investigated for his criminal responsibility by applying mutatis mutandis the provisions of Article 163 of the Criminal Law； if grave consequences result from such crime， his criminal responsibility shall be investigated in accordance with the provisions of Article 110 of the Criminal Law.</P>
<P> An enterprise or institution which commits the crime prescribed in the preceding paragraph shall be subject to a fine， and criminal responsibilities shall be investigated against the person directly in charge and other personnel directly responsible for the crime in accordance with the provisions of the preceding paragraph.</P>
<P> A person who conceals and brings firearms， ammunition and controlled knives while flying in a civil aircraft shall be investigated for his criminal responsibility by applying mutatis mutandis the provisions of Article 163 of the Criminal Law.</P>
<P> Article 194 Where a public air transport enterprise carries dangerous articles in violation of the provisions of Article 101 of this Law， the competent civil aviation authority under the State Council shall confiscate its unlawful earnings and may also impose a fine of not more than 100% of the unlawful earnings.</P>
<P> Where a public air transport enterprise commits an act described in the preceding paragraph and thereby creates a serious accident， its unlawful earnings shall be confiscated and a fine shall be imposed； and criminal responsibilities shall be investigated against the person directly in charge and other personnel directly responsible for the crime in accordance with the provisions of Article 115 of the Criminal Law.</P>
<P> Article 195 A person who deliberately places or instigates another person to place dangerous articles on board a civil aircraft in use， sufficient to destroy the civil aircraft and endanger flight safety but without resulting in serious consequences， shall be investigated for his criminal responsibility in accordance with the provisions of Article 107 of the Criminal Law； if grave consequences result from such crime， he shall be investigated for criminal responsibility in accordance with the provisions of Article 110 of the Criminal Law.</P>
<P> Article 196 A person who deliberately transmits false information and disturbs the normal order of flight， resulting in serious losses to public or private property， shall be investigated for criminal responsibility in accordance with the provisions of Article 158 of the Criminal Law.</P>
<P> Article 197 A person who steals or deliberately damages or removes navigational facilities in use and thereby creates danger to flight safety， sufficient to cause the fall or destruction of the civil aircraft but without resulting in serious consequences， shall be investigated for criminal responsibility in accordance with the provisions of Article 108 of the Criminal Law； if grave consequences result from such crime， he shall be investigated for criminal responsibility in accordance with t</P> he provisions of Article 110 of the Criminal Law.
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<P> Article 198 A person who assembles a crowd to disturb the order in a civil airport shall be investigated for his criminal responsibility in accordance with the provisions of Article 159 of the Criminal Law.</P>
<P> Article 199 Where an airman neglects his duty or violates the rules and regulations， thereby creating a serious flight accident resulting in grave consequences， his criminal responsibility shall be investigated in accordance with the provisions of Article 187 or by applying mutatis mutandis the provisions of Article 114 of the Criminal Law respectively.</P>
<P> Article 200 A person who violates the provisions of this Law， not seriously enough for criminal punishment but should be subject to penalty for public security， shall be punished in accordance with the Regulations on Administrative Penalties for Public Security.</P>
<P> Article 201 Where in violation of the provisions of Article 37 of this Law， a civil aircraft flies without the certificate of airworthiness， or a foreign civil aircraft on lease flies without having its certificate of airworthiness， issued by the State in which the nationality of the aircraft was originally registered， examined and rendered valid by the State Council， or without having a new certificate of airworthiness issued therefor by the said authority， the competent civil aviation authority under the State Council shall order it to stop flying， confiscate the unlawful earnings， and may also impose a fine of more than 100% but not exceeding 500% of the unlawful earnings； in case there is no unlawful earnings， a fine of not less than 100，000 yuan but not more than 1，000，000 yuan shall be imposed.</P>
<P> Where a certificate of airworthiness has lost its effect or a flight was conducted beyond the scope prescribed in the certificate of airworthiness， the punishment prescribed in the preceding paragraph shall apply.</P>
<P> Article 202 Where a person， in violation of the provisions of Article 34 and paragraph 2 of Article 36 of this Law， carries out the production of civil aircraft and its engines， propellers or on-board equipment without obtaining type certificate and type validation certificate， the competent civil aviation authority under the State Council shall order him to stop such production， confiscate his unlawful earnings and may also impose on him a fine of not more than 100% of his unlawful earnings； in case there is no unlawful earnings， a fine of not less than 50，000 yuan but not more than 500，000 yuan shall be imposed.</P>
<P> Article 203 Where a person， in violation of the provisions of Article 35 of this Law， is engaged in the activities of production and maintenance without obtaining production certificate and maintenance certificate or， in violation of the provisions of Article 92 and paragraph 2 of Article 147 of this Law， is engaged in public air transport or general aviation operations for commercial purposes without obtaining a public air transport operating licence or a general aviation operating licence， the competent civil aviation authority under the State Council shall order him to stop such production， maintenance or operations.</P>
<P> Article 204 Where an enterprise having obtained the production certificate and maintenance certificate prescribed in Article 35 of this Law creates a serious accident because of the problem in the quality of production and maintenance， the competent civil aviation authority under the State Council may cancel its production certificate or maintenance certificate.</P>
<P> Article 205 Where a person， in violation of the provisions of Article 40 of this Law， is engaged in civil aviation activities without obtaining the corresponding airman's licence and physical e</P> xamination certificate， the competent civil aviation authority under the State Council shall order him to stop such activities， no such licence and certificate shall be issued within the time limit prescribed by the competent civil aviation authority under the State Council， and a fine of not more than 200，000 yuan shall be imposed on the unit that the person belongs to.
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<P> Article 206 In one of the following circumstances in which the law is violated， the competent civil aviation authority under the State Council hall punish the pilot-in-command by warning or by withholding his licence for a period of one to six months， or under aggravating circumstances， punish him by cancelling his licence：</P>
<P> （1） The pilot-in-command， in violation of the provisions of paragraph 1 of Article 45 of this Law， takes off without carrying out an inspection of the civil aircraft； or</P>
<P> （2） A civil aircraft， in violation of the provisions of Article 75 of this Law， fails to follow the air route and to fly at the altitude specified by the air traffic unit， or in violation of the provisions of Article 79 of this Law， flies across the airspace over a city.</P>
<P> Article 207 Where a civil aircraft， in violation of the provisions of Article 74 of this Law， conducts flight activities without the approval of the air traffic control unit， the competent civil aviation authority under the State Council shall order it to stop flying， and impose a fine on the owner or lessee of the civil aircraft of not less than 10，000 yuan but not more than 100，000 yuan； and punish the pilot-in-command of the civil aircraft by warning or by withholding his licence for a period of one to six months， or under aggravating circumstances， punish him by cancelling his licence.</P>
<P> Article 208 Where the pilot-in-command of a civil aircraft or another member of the crew commits one of the following acts， the competent civil aviation authority under the State Council shall punish him by warning or by withholding his licence for a period of one to six months； if the act listed in sub-paragraph （2） or （3） is committed， he shall be punished by having his licence cancelled：</P>
<P> （1） Failure to carry on his person licence and physical examination certificate in performing a flight mission as required by the provisions of Article 41 of this Law； or</P>
<P> （2） Leaving the civil aircraft in distress in violation of the provisions of Article 48 of this Law；</P>
<P> （3） Performing a flight mission in violation of the provisions of paragraph 2 of Article 77 of this Law.</P>
<P> Article 209 Where some articles are dropped or sprayed from a civil aircraft in flight in violation of the provisions of Article 80 of this Law， the competent civil aviation authority under the State Council shall give a warning， and may impose a fine of not less than 2，000 yuan but not more than 20，000 yuan on the person directly responsible.</P>
<P> Article 210 Where a civil airport is opened to traffic without obtaining an airport operating licence in violation of the provisions of Article</P>
<P> 62 of this Law， the competent civil aviation authority under the State Council shall order it to stop its opening to traffic， confiscate its unlawful earnings， and may impose a fine of not exceeding 100% of the unlawful earnings.</P>
<P> Article 211 Where a public air transport enterprise or a general aviation enterprise violates the provisions of this Law， in circumstances of a serious nature， the competent civil aviation authority under the State Council may， in addition to the punishment prescribed by this Law， cancel its operating licence. If the operating licence of such enterprise is cancelled， the administrative department for industry and commerce shall cancel its busines</P> Article 212 The working personnel of the competent civil aviation authority under the State Council and of regional civil aviation administrative organs， who neglect their duties， abuse their powers， practise favouritism and embezzlement， if the case constitutes a crime， shall be investigated for criminal responsibilities according to law； if the case does not constitute a crime， they shall be subject to administrative sanctions according to law.
<P> Chapter XVI Supplementary Provisions</P>
<P> Article 213 “Unit of account” mentioned in this Law refers to the Special Drawing Right as defined by the International Monetary Fund； its equivalent in Renminbi shall be the amount calculated in terms of the conversion rate from the Special Drawing Right of the International Monetary Fund to Renminbi as prescribed by the competent State foreign exchange authority at the date of the judgement of the court， the date of the award of arbitration agency or the date agreed between the parties concerned.</P>
<P> Article 214 This Law shall go into effect as of March 1， 1996.</P>
<P> （In case of discrepancy between the English translation and the original Chinese text， the Chinese text shall prevail. ——Tr.）</P>
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