CHINA Law and Practice Contributed by: Tim Yimin Liu, Sybil Xueting Yuan and Cassie Wenjing Li, Global Law Office
1. General 1.1 Prevalence of Arbitration
structure, sale of goods, finance, services contracts, capital markets, and equity investment remained as key sources of disputes. Emerging new industries and business models have given rise to a growing number of new and complex case types. • Financial Derivatives – Disputes arising from over- the-counter transactions of financial derivatives, particularly involving structured products such as “snowball” options. • Digital Technology – Technology and digital econo - my-related disputes, including those in the cross- border e-commerce sectors, online services con - tracts, data governance, and intellectual property issues such as software licensing and technology transfer between global tech giants and high-tech enterprises. • New Energy – Disputes in the new energy vehicle sector, as well as those related to carbon emis - sions trading, carbon asset verification, capacity quota transfers, and co-operation under the Clean Development Mechanism framework. • ESG – Corporate governance-related disputes, especially those involving anti-commercial bribery clauses, reflecting a heightened focus on ESG (environmental, social and governance) considera - tions. • Third Party Funding – Disputes involving novel legal service arrangements, such as the perfor - mance and enforcement of third-party funding agreements in international arbitration. 1.3 Arbitration Institutions In 2024, in terms of the number of cases, the SCIA handled a record-breaking 14,518 commercial arbi - tration cases, leading all other institutions and mark - ing the highest number in its own history. The total amount in disputes increased from CNY138.31 bil - lion in 2023 to CNY142.267 billion, maintaining over CNY100 billion in disputed amounts for the third con - secutive year. In terms of total disputed amount, the CIETAC ranked first with CNY188.96 billion (for 6,013 new cases in 2024). Notably, the CIETAC has exceeded CNY100 billion for the seventh consecutive year.
In 2024, for cross-border commercial transactions, statics show that more parties tended to resort to international arbitration administered by Chinese arbi- tration institutions. According to the 2024 annual work reports of major arbitration institutions, the following were reported. • The China International Economic and Trade Arbitration Commission (CIETAC) registered 758 new foreign-related cases, marking a year-on-year increase of 17.52%. The total amount in dispute reached CNY81.125 billion, representing a 53.75% increase from the previous year. The number of countries and regions involved further expanded to 93, with parties coming from 77 jurisdictions. • The Shenzhen Court of International Arbitration (SCIA) also saw a significant increase. It handled 520 international commercial arbitration cases in 2024 – up 25.6% year-on-year – with a total disputed amount of CNY51.039 billion. Notably, one of SCIA’s international cases involved a single dispute amount exceeding CNY30 billion, setting a record for the highest single-claim amount ever handled by an Asian arbitration institution. • The Beijing Arbitration Commission (BAC) recorded a 10.36% year-on-year increase in foreign-related cases. • The Shanghai International Economic and Trade Arbitration Commission (SHIAC) reported a 40.46% surge in foreign-related cases. In China, the basis for international commercial arbi - tration is primarily the arbitration agreement between Chinese and foreign parties in their cross-border com - mercial transactions. It also includes scenarios where parties apply to Chinese courts for recognition and enforcement of foreign arbitral awards, or cases in which foreign arbitral institutions are chosen but the seat of arbitration is designated as China. 1.2 Key Industries In 2024, the types of disputes handled by China’s major arbitration institutions continued to diversify. Traditional sectors such as construction and infra -
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