The Understanding and Application of Some Basic Problems on Penalty——Concurrently Discuss on the Regulations of Penalty, Art. 114 in Contract Law

This paper puts forward the proposals for defining the concept of penalty in China,by comparing the concepts of penalty from the domestic and international legislation and scholars.It also points out that penalty is only a form of liability of breach of contract,and penalty in China belongs to compensational penalty.In practice,there should be some temperance on adjustment to the amount of compensational penalty,but some legal restraints on the punitive penalty of its highest level.