Comparative law notes
Different countries have different rules on what constitutes a "breach" of contract and what the consequences are. Under Chinese law, for instance, there is the concept of 根本违约 ("fundamental breach") - where the breach is such that the purpose of the contract becomes impossible to be achieved - which gives the innocent party the right to terminate the contract and seek compensation. Therefore, the term here 严重违约 "material breach" is used loosely; contract laws of the country in question should be consulted in more detail.