CHINA Law and Practice Contributed by: Yue Dai, Zhenghao Li and Xiaokun Yuan, King & Wood
where the contract is performed will have jurisdiction over the case. Product liability claims based on tort are under the jurisdiction of the court at the place where the tortious act occurred or the domicile of the defendant. In addi - tion, courts in places where the disputed products are manufactured or sold also have jurisdiction over such claims. Accordingly, the infringed party may file the lawsuit with any of the competent courts. Specifically, the place where the tort occurred includes the place where the tortious conduct was committed and the place where the consequences of the tortious conduct occurred. If the manufacturer and seller are domiciled in China, the Chinese courts will, without a doubt, have jurisdiction over the proceedings. If the manufacturing and selling take place outside China, the manufacturer and seller may still fall under the jurisdiction of the Chinese courts if the damage occurs within China. Hierarchical Jurisdiction Depending on the amount in dispute, a civil dispute may be heard by courts at different levels including district courts, intermediate courts or high courts. The precise threshold for each level of court to hear a case varies by region. In practice, since the underly - ing amount in product liability cases is relatively small, these cases are usually heard by the district courts. The “People’s Juror” Since China has a legal system based on civil law, there is no trial by jury in Chinese courts. However, there is a “People’s Juror” system, by which a non- judge citizen can serve on the hearing panel in a case governed by normal procedure, with the same power as a judge. The juror can participate in fact-finding, the application of law and the decision-making process. 2.11 Appeal Mechanisms for Product Liability Claims The rules for appeal in product liability disputes are the same as in other civil proceedings governed by the Civil Procedure Law and its judicial interpretations. The judgments or certain rulings made by the court of first instance may be appealed on grounds including
fault in fact-finding, incorrect application of laws, and serious procedural violations. Once the court of first instance delivers the ruling or judgment, either party may file an appeal with the People’s Court at the higher level within 15 days from the date of service of the judgment, or ten days from the date of service of the ruling. The appellate court may decide to uphold, withdraw or revise the original ruling or judgment, or remand the case back to the lower court. 2.12 Defences to Product Liability Claims Under Chinese law, the defendant in a product liability dispute can raise procedural and substantive defenc - es. In contractual claims arising from product flaws that do not pose a safety hazard, the seller may argue that the buyer (or consumer) was explicitly informed of such a flaw and therefore the seller should be exempt from liability for breach of contract. In tort claims over damage caused by product defects, product quality laws and regulations outline the fol - lowing three statutory defences under which a manu - facturer may be exempt from liability: • the products have not been put into circulation; • the defects did not exist when the products were put into circulation (in other words, the manufac - turer can demonstrate that the defect was caused by the victim or other third parties); and • the scientific and technological standards at the time the product was put into circulation did not enable the manufacturer to detect the defect in the product. Additionally, as outlined in 2.1 Product Liability Caus- es of Action and Sources of Law , the plaintiff must satisfy the burden of proving three elements in a tort claim (ie, defects, injuries or damage, and a causal relationship between these). A defendant may also avoid liability by successfully challenging any of these three elements. In legal practice, defendants in gen - eral tend to challenge the existence of “defects” and a “causal relationship”.
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