CHINA Law and Practice Contributed by: Siyuan Liu, Wei Wang and Huanhuan Yu, Jingtian & Gongcheng
Jingtian & Gongcheng 34/F Tower 3 China Central Place 77 Jianguo Road Beijing 100025 China Tel: +86 010 5809 1385 Fax: +86 010 5809 1100 Email: liu.siyuan@jingtian.com Web: www.jingtian.com
1. Policy Development of Collective Redress/Class Action Mechanisms 1.1 History and Policy Drivers of the Legislative Regime Overview of Collective Redress/Class Action in China Narrowly construed, “collective redress” or “class action” refers primarily to the class action regime in the United States or comparable systems. In mainland China (excluding Hong Kong, Macau, and Taiwan), the closest analogue is the “special representative action” in securities misrepresentation litigation. Broadly con- strued, collective redress/class action encompasses all forms of litigation involving the rights and interests of multiple parties, including various forms of joint action. The Civil Procedure Law of the PRC (for Trial Imple- mentation, 1982) first introduced joint action, allowing consolidation for trial where one or both parties to a lawsuit comprise multiple persons and the subject matter is identical or of the same type. Ordinary representative action mechanism Developmental Trajectory Joint action mechanism As large-scale class disputes emerged, the Civil Pro- cedure Law of the PRC (1991) and the Opinions on Several Issues Concerning the Application of the Civil Procedure Law (1992) established the ordinary repre- sentative action mechanism. In 2003, the Supreme People’s Court (SPC) refined the ordinary representa- tive action mechanism in the Several Provisions on
Trying Cases of Civil Compensation Arising from Mis- representation in the Securities Market (“Misrepre- sentation Judicial Interpretation”). In 2019, the SPC’s Minutes of the National Civil and Commercial Trial Work Conference advocated eligible local courts to apply the representative actions mechanism. In March 2020, when the revised Securities Law of the PRC (the “Securities Law”) took effect, Article 95 (1) and (2) of the Security Law formally codified the ordinary rep- resentative securities action mechanism. That same month, the Hangzhou Intermediate People’s Court applied the representative actions mechanism in the Wuyang Bond case, involving an uncertain number of parties, marking its full activation in securities dis- putes. Model judgment mechanism In financial and securities disputes, the courts also developed the model judgment mechanism. In May 2016, the SPC and the China Securities Regula- tory Commission (CSRC) promulgated the Notice on Conducting a Pilot Programme of Diversified Dispute Resolution Mechanisms in Securities and Futures in Certain Regions (“Pilot Programme of Diversified Dis- pute Resolution Mechanisms”). In November 2018, the SPC and CSRC promulgated the Opinions on Comprehensively Advancing Diversified Dispute Res- olution Mechanisms in Securities and Futures (“Diver- sified Dispute Resolution Mechanisms”). The two doc- uments established the model judgment mechanism. This mechanism allows courts to first adjudicate a rep- resentative case in mass disputes involving an uncer- tain number of parties. Subsequent parallel cases may
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