Abstract: Prepaid consumption is a payment method by which the consumer pays the total price of continuous consumption in the future to the operator in one lump sum at the time when the contract is established. The paid transaction relationship between the consumer and the operator is constructed as a single contract relationship in which only the operator continuously performs debts to the consumer, so the consumer may bear the transaction risk of the operator's breach of contract and improper performance for a long time. The termination of the contract is the main right of consumers to respond to the dishonesty of operators and safeguard their own rights and interests. In accordance with the provisions of the Civil Code and the Consumer Protection Law and from the dual perspectives of operators and consumers, the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Civil Dispute Cases Involving Prepaid Consumption provides for detailed rules on the legal causes for the termination contracts by consumers and the legal consequences of contract termination. In addition to terminating the contract and requesting the operator to return the balance of the advance payment and its interest, consumers can also request the operator to bear the liability for any losses resulting from its breach of contract. 

Keywords: prepaid consumption; consumer contracts; the right to terminate contract; return of advance payment 

Author: Zhu Guangxin, research fellow, doctoral supervisor, and deputy head of the Civil Law Department of CASS Institute of Law; executive director, Civil Law Research Committee of China Law Society; and deputy editor-in-chief, Civil and Commercial Law Review. 

Source: 5 (2025) Journal of Law Application.