Generally speaking, the upper limit of contract liquidated damages is not more than 30% of the actual loss. (1) The liquidated damages shall be determined by both parties through negotiation. There is no limit on the amount, and they are generally determined according to the loss that may be caused by one party's breach of contract predicted by both parties. (2) If the agreed liquidated damages are lower than the actual losses after one party breaches the contract and the non breaching party requires the breaching party to bear the liability for breach of contract, the non breaching party can sue to the court for increasing the liquidated damages; If the agreed liquidated damages are too high than the actual losses, the defaulting party can sue to the court for reducing the liquidated damages.
 Legal basis
 Article 585 [Liquidated Damages] of the Civil Code of the People's Republic of China [Liquidated Damages] The parties may agree that when one party breaches the contract, it shall pay a certain amount of liquidated damages to the other party according to the circumstances of the breach, or they may agree on the calculation method of the amount of compensation for losses arising from the breach.
 If the agreed liquidated damages are lower than the losses caused, the people's court or arbitration institution may increase them at the request of the parties; If the agreed liquidated damages are too high than the losses caused, the people's court or arbitration institution may, at the request of the parties, appropriately reduce them.
 If the parties agree on liquidated damages for delay in performance, the defaulting party shall perform its obligations after paying the liquidated damages.