CHINA Law and Practice Contributed by: Tim Yimin Liu, Sybil Xueting Yuan and Cassie Wenjing Li, Global Law Office
The following new establishments recently appeared in China. • On 12 November 2024, the Chongqing Interna - tional Commercial Arbitration Court was officially inaugurated. • In December 2024, the Beijing Representative Office of the Hong Kong International Arbitration Centre (HKIAC) was formally registered, making it the first foreign arbitration institution to establish a representative office in Beijing. • On 26 December 2024, the China (Shanghai) Secu - rities and Futures Arbitration Centre was officially launched. 1.4 National Courts China has not established a national standalone “international commercial court” system to hear disputes related to international arbitrations and/or domestic arbitrations, even though such courts have been established in certain cities like Shanghai, Shen - zhen, Hangzhou and Beijing. In other cities, courts at the intermediate level are generally vested with jurisdiction over matters related to both international and domestic arbitrations. These courts are compe - tent to handle various arbitration-related proceedings (including the grant of interim measures in arbitration, challenges to the validity of arbitration agreements, applications to set aside domestic arbitral awards, and requests for recognition and enforcement of for - eign arbitral awards). 2. Governing Legislation 2.1 Governing Law Legal Framework The following legislation governs international arbitra - tion in China. • The Arbitration Law of the People’s Republic of China (the “PRC Arbitration Law”), enacted on 31 August 1994. The current effective version was promulgated on 1 September 2017 and came into effect on 1 January 2018. The PRC Arbitration Law constitutes the foundational legislation for com - mercial arbitration in China.
• The Supreme People’s Court (SPC)’s Interpreta - tion on the Application of the PRC Arbitration Law (the “SPC’s Interpretation of the Arbitration Law”), issued on 16 December 2008, provides important judicial guidance on key issues. • The Civil Procedure Law of the PRC (the “PRC Civil Procedure Law”) also contains important provi - sions relevant to arbitration, particularly concerning interim measures, enforcement of arbitral awards, and setting aside or refusal to enforce arbitral awards. National Legislation and the UNCITRAL Model Law The PRC Arbitration Law draws certain elements from the UNCITRAL Model Law (the “Model Law”); how - ever, it does not directly adopt the Model Law frame - work. In fact, the two differ significantly in several key respects. • Ad hoc arbitration – The Model Law permits ad hoc arbitration. However, under the current PRC Arbitration Law, ad hoc arbitration is not gener - ally recognised in Mainland China, with the sole exception of certain circumstances in the Shanghai Free Trade Zone. Ad hoc arbitration is expected to be introduced when the amendment to the current PRC Arbitration Law comes into effect, hopefully in 2025 or 2026. • Competence-competence principle – The Model Law embraces the competence-competence principle, whereby the arbitral tribunal can rule on its own jurisdiction. However, under the current PRC Arbitration Law, the authority to determine the validity of an arbitration agreement rests on either the arbitration institution or a competent court. • Seat of arbitration – The Model Law recognises the concept of the seat of arbitration and its legal implications. The current PRC Arbitration Law does not explicitly adopt this concept, nor define it at legislative level. But it has been acknowledged in judicial practice and referenced in internal SPC memoranda. • Interim measures – Under the Model Law, both courts and arbitral tribunals may grant interim measures. Under the current PRC Arbitration Law, for now such applications should be submitted to the arbitration institution and then forwarded to the courts. It is the courts, rather than the arbitra -
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