Abstract: There has been an ongoing debate in both academia and practice regarding what kind of agreement can be deemed a “preliminary agreement” and what legal effects such an agreement will produce. Articles 6 to 8 of the Interpretation by the Supreme People’s Court of Several Issues Concerning the Application of General Provisions of Book Contracts of the Civil Code stipulate that the motivation for parties to enter into a preliminary agreement is to reserve the right to ultimately determine whether the substantive contract will be formed. Therefore, a preliminary agreement can only generate a duty of good faith negotiation between the parties, but cannot compel the formation of the substantive contract. The “final decision-making power theory” reflected in the judicial interpretation mistakenly takes the negotiation agreement as the prototype of a preliminary agreement, blurring the distinction between preliminary agreements and other prior agreement types, and the sweeping presumption that a preliminary agreement cannot be further performed lacks sufficient persuasiveness. When handling disputes over preliminary agreements, we should return to the general principles of contract law, examine whether the elements of the definitive agreement are complete and certain, and determine the legal effects of the preliminary agreement through the interpretation rules of the expression of intent.