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+.. index:: ! contract;creation, constructor
+
+******************
+Creating Contracts
+******************
+
+Contracts can be created "from outside" via Ethereum transactions or from within Solidity contracts.
+
+IDEs, such as `Remix <https://remix.ethereum.org/>`_, make the creation process seamless using UI elements.
+
+Creating contracts programmatically on Ethereum is best done via using the JavaScript API `web3.js <https://github.com/ethereum/web3.js>`_.
+It has a function called `web3.eth.Contract <https://web3js.readthedocs.io/en/1.0/web3-eth-contract.html#new-contract>`_
+to facilitate contract creation.
+
+When a contract is created, its :ref:`constructor <constructor>`  (a function declared with the ``constructor`` keyword) is executed once.
+
+A constructor is optional. Only one constructor is allowed, which means
+overloading is not supported.
+
+After the constructor has executed, the final code of the contract is deployed to the
+blockchain. This code includes all public and external functions and all functions
+that are reachable from there through function calls. The deployed code does not
+include the constructor code or internal functions only called from the constructor.
+
+.. index:: constructor;arguments
+
+Internally, constructor arguments are passed :ref:`ABI encoded <ABI>` after the code of
+the contract itself, but you do not have to care about this if you use ``web3.js``.
+
+If a contract wants to create another contract, the source code
+(and the binary) of the created contract has to be known to the creator.
+This means that cyclic creation dependencies are impossible.
+
+::
+
+    pragma solidity >=0.4.22 <0.6.0;
+
+    contract OwnedToken {
+        // `TokenCreator` is a contract type that is defined below.
+        // It is fine to reference it as long as it is not used
+        // to create a new contract.
+        TokenCreator creator;
+        address owner;
+        bytes32 name;
+
+        // This is the constructor which registers the
+        // creator and the assigned name.
+        constructor(bytes32 _name) public {
+            // State variables are accessed via their name
+            // and not via e.g. `this.owner`. Functions can
+            // be accessed directly or through `this.f`,
+            // but the latter provides an external view
+            // to the function. Especially in the constructor,
+            // you should not access functions externally,
+            // because the function does not exist yet.
+            // See the next section for details.
+            owner = msg.sender;
+
+            // We do an explicit type conversion from `address`
+            // to `TokenCreator` and assume that the type of
+            // the calling contract is `TokenCreator`, there is
+            // no real way to check that.
+            creator = TokenCreator(msg.sender);
+            name = _name;
+        }
+
+        function changeName(bytes32 newName) public {
+            // Only the creator can alter the name --
+            // the comparison is possible since contracts
+            // are explicitly convertible to addresses.
+            if (msg.sender == address(creator))
+                name = newName;
+        }
+
+        function transfer(address newOwner) public {
+            // Only the current owner can transfer the token.
+            if (msg.sender != owner) return;
+
+            // We ask the creator contract if the transfer
+            // should proceed by using a function of the
+            // `TokenCreator` contract defined below. If
+            // the call fails (e.g. due to out-of-gas),
+            // the execution also fails here.
+            if (creator.isTokenTransferOK(owner, newOwner))
+                owner = newOwner;
+        }
+    }
+
+    contract TokenCreator {
+        function createToken(bytes32 name)
+           public
+           returns (OwnedToken tokenAddress)
+        {
+            // Create a new `Token` contract and return its address.
+            // From the JavaScript side, the return type is
+            // `address`, as this is the closest type available in
+            // the ABI.
+            return new OwnedToken(name);
+        }
+
+        function changeName(OwnedToken tokenAddress, bytes32 name) public {
+            // Again, the external type of `tokenAddress` is
+            // simply `address`.
+            tokenAddress.changeName(name);
+        }
+
+        // Perform checks to determine if transferring a token to the
+        // `OwnedToken` contract should proceed
+        function isTokenTransferOK(address currentOwner, address newOwner)
+            public
+            pure
+            returns (bool ok)
+        {
+            // Check an arbitrary condition to see if transfer should proceed
+            return keccak256(abi.encodePacked(currentOwner, newOwner))[0] == 0x7f;
+        }
+    }