Rebuilding the Court Funding Mechanism After Recent Reforms

SPC list of winners of the Ram City Cup for judicial reform essays

This post is a lengthy summary/incomplete translation of an article entitled 省级统管后法院经费保障机制再造 (Reconstruction of the Court’s Funding Guarantee Mechanism after Provincial Administration)by Fan Lisi (范丽思), a judge of the Wuhou People’s Court, Chengdu, Sichuan Province. Judge Fan was one of the first prize winners in the 2020  “Ram City Cup” competition for articles on judicial reform, administered by the Supreme People’s Court (SPC)’s judicial reform office.  People’s Justice (人民司法) published her article in 2021. Many thanks to Guo Ran, a current Tufts student, and Tina Chen ( 陈雨茗), an Oxford undergraduate for assisting with the translation/summary. I have included some explanations in square brackets [].  I have omitted most of the charts/graphics.  I welcome corrections to the summary/abridged translation and comments.

Based on her review of data from multiple provinces/directly administered cities, the author shows that the reform of funding the courts at the provincial level (cited as one of the successes of the judicial reforms in several English language academic articles) has been a failure. The reforms make the local courts even more dependent on local financing. She explains why that happened. 

I surmise that 2022 will be an even more challenging year for court budgets in many areas, as provincial/local budgets are under greater stress because of testing for Covid-19, decreased income from land sales, and less tax revenue because of lockdown-related downturns in business activity. 

She looks at other court financing models abroad and discusses a topic I have rarely seen mentioned in the academic literature about the Chinese courts (certainly in English–I don’t claim to be as familiar with the Chinese academic literature)–separating the judicial and administrative functions. I have had discussions with several persons previously affiliated with the SPC on this issue.  She proposes that the SPC establish a finance committee and that local courts establish counterpart institutions. Drawing on her research on Chinese court funding and that of other jurisdictions, she proposes a new model.  I cannot claim any expertise on this and will not comment on the practicability of her proposal. 

Introduction

The role of the people’s courts in national governance has changed.  Judicial authority has transformed into a central power from a local power  [司法事权属性已由地方事权转变为中央事权]. The transformation of the courts’ functions requires a mechanism for guaranteeing funding that matches the operation of judicial power. The provincial unified administration reform in 2014 saw the beginning of the current funding guarantee mechanism reform. [This reform was part of the 4th Five-Year Judicial Reform Plan]. But after five years of pilot practice, the provincial unified administration has not achieved its established goals of “de-localization,” “de-administratization” [去行政化] and “balanced judicial supply power  (均衡司法供给力).”  It is necessary to reflect on the reasons for the failure of the provincial unified management reform, clarify the theoretical components [应然内涵] of the court funding guarantee mechanism, identify the situational variables affecting the choice of reform tools, and “reload “the reform toolbox. Based on provincial unified management, China should build a court funding guarantee mechanism that follows judicial principles [规律]  and financial management principles, so as to effectively solve the problem of financial resources for the operation of the judiciary and assist in constructing modern social governance in China based on the rule of law.

Number

Problems that the Reform aimed to resolve

Solution provided by the Reform

Underlying judicial value

1

Who is paying (the money)?

The source of funding is raised to the provincial level of administration, altering from local finance departments to provincial finance departments.

To allow the courts to gain independence economically from local governments, removing localized variants and guarantee judicial independence.

2

Who is responsible for the distribution and management of the money?

The main body of funding is raised to the provincial level. Funding used to be distributed and managed by local financial departments is now subject to provincial financial departments.

To eliminate regional differences within the same province, and to realize the standardization of judicial services through standardizing financing capacity of the courts.

3

How is the total amount of funding determined?

Fixed-base budget: The reform uses the total amount of funds before as the “base;” the base will only be raised but not reduced.

Institutionally secure the “guaranteed amount” of legal funding, overcome the problem of arbitrariness in determining the total amount of funding in the previous years, and establish a benign dynamic growth mechanism of funding

4

To whom is the power of reviewing budgets vested in:

Governmental budgeting department with limited power to review: provincial finance departments delegate the power to conduct initial review of budgets to provincial courts. They will then sum up the subordinate courts’ budgets and conduct initial review of their reasonableness and compliance. Then the provincial finance department will submit them among other departmental budgets to the provincial People’s Congress.

Develop the court’s function of funding management, make use of the higher court’s knowledge of the lower courts, and enable the higher courts to fully participate in the lower courts’ budget filing, review, and coordination processes

I.  Benchmarking review: Evaluating the practical effectiveness of provincial unified management

The provincial unified management of court funding attempts to centralize the administration of court funding at the provincial level. Cout funding was previously an obligation of local government on the same administrative level as the local court. The reform aims to break the previous local court fund management pattern, reshaping the relationship between courts, administrative agencies, and Party and government agencies, which has had an impact on the autonomy and fairness of the local courts.

To analyze the success of this reform, the author selected the 2019 and 2020 budget and final accounts data of 1,535 basic-level courts (data from 14 provincial-level jurisdictions: Tianjin, Jiangsu, Guangxi, Hunan, Jiangxi, Inner Mongolia, Guizhou, Hebei, Shaanxi, Shanghai, Guangdong, Beijing, Shanxi, Yunnan. She reviewed the following data:

  1. basic-level court department’s budget,
  2. final accounts public statement, and
  3. people’s courts’ financial statistics analysis system

and analyzed key indicators such as :

  1. source of funding,
  2. average cost of each case
  3. average public expenditure per case, and t
  4. growth rate of case-handling operational funds, etc. 

A. The reform has not eliminated local court dependence on  government at the same level

The study presented the following findings:

(1) Shifting the source of court funding has not completely freed the local courts from depending on local governments.

The current judicial reform centered on withdrawing court funding from the government-led horizontal model of bureaucracy and removing the function of allocating or transferring funds from governments on the same administrative level through institutional reforms, which in turn removes the possibility of the judiciaries colluding with governments on the same administrative level to solicit funding. After the transformation into provincial unified management, the judiciaries’ funding will mainly be composed of provincial finance; governments on the same administrative level will cease to allocate funds to the judiciary.

By examining the funding income structure of the sample courts in 2020, the study found that, out of 741 courts that have been reformed, 249 still relied on funding from governments on the same administrative level, which comprised 43.22% of the courts’ total funding.

In the case of some local courts in Shanxi and Hebei province, the percentage could even reach 87%.  Funding from government on the same administrative level compensates for the lack of funding for:

  1. labor costs;
  2. office administration;
  3. facilities procurement; and
  4. general maintenance,

Labor costs are the largest proportion, at 63.05%.

From the above data, it is clear that nearly 33.6% of local courts have not yet completely detached from local governments financially, even after the reform.

 B.  Raising the funding guarantee to the provincial level has not significantly improved unequal financial supply capacity

 Balanced judicial finance is the necessary condition for standardized judicial services. One of the objectives of the provincial unified management reform was to ensure that the public has equal access to judicial services of equivalent quality and quantity within a province, by arranging courts’ funds on a provincial level.

The equalization of financing provision capacity is a sensitive indicator. In order to obtain a concrete observation of this indicator, the author has selected “public expenditure per case” and “cost per case” to reflect, respectively, the ability to finance “administrative affairs” and “enforcement of courts’ decision”….

Suppose we reflect on the tools adopted by the provincial unified management plan. In that case, we could explore the problems in tool selection and application with the existing reform and establish useful precedents for a new funding guarantee mechanism.

C. The policy requirement of a guaranteed minimum funding does not necessarily produce a sustainable dynamic increase in the courts’ funds.

In “Framework Opinions on Several Issues of Judicial System Reform Pilot” (referred to as “Framework Opinions”)  issued by the Central Leadership in 2014, it was stated that after the implementation of the provincial unified management reform the total amount of funding must not decrease, however, this minimum requirement does not suggest a sustainable increase in funding. Among the sample courts, 711 courts experienced growth in the number of cases heard in 2018.

Through comparing and analyzing the growth rate of cases heard and the growth of overall funding in handling cases, it was found that in 66.67% of the courts the growth rate of overall case funding was lower than the growth rate of cases heard; among them, 55.13% of the courts even had a decrease in case funding when the number of cases heard had increased; the courts that been reformed had a comparative advantage in terms of the increase of funding in cases. Among the 237 courts that saw equivalent or higher growth in case funding than cases heard, there was almost a fifty-fifty division between reformed and unreformed courts. (See the figure below)

D. The power of provincial courts to manage funds continues to be marginalized.

Under the institutional framework of “One Government, One Committee and Two Courts”, [government, the supervision commission, the courts and procuratorate] judicial independence manifests in the division of labor rather than independent authority from the government.

However, a mode of leading and being led, managing and being managed is formed between the local courts and government on the same administrative level, through the mediation of the fiscal relationship. The provincial unified management reform hopes to rebalance the power constraints between the provincial court and governmental departments, through the practice of restoring an interactive relationship between the courts and government, by developing the courts’ own financial management capacity and transferring the power to manage funds from government to the courts.

But the four management models developed in the process of promoting the reform have been found to be problematic in their own respects: the direct management model (adopted by 57.15% of the reformed courts) tends to marginalize the managing power of provincial courts, and local courts will communicate directly with provincial fiscal departments; in the assisted-management model (adopted by 38.1% of the reformed courts), although the provincial courts are involved in the management process, their role is reduced to that of a megaphone, with no substantial power of their own; the model of entrusting municipal management of court funds does not achieve the reform objective of transferring the fund management power to the provincial courts; the trusteeship model, in which the provincial treasury delegates the daily management of funds to the provincial courts, is only an expedient measure to fill up the absence of the provincial government’s financial management capacity. It is also worth noting that only one province has adopted this model.

Therefore, it can be concluded that the provincial courts have not taken up the power of allocating funds as the reform expected, and have again ended up being marginalized in fund management.

II. real-world problems: dissecting the failure of provincial management reforms

Reason 1: lack of capacity to financially supply at the provincial level inhibits the local courts from becoming financially independent from local governments

The ideal plan, according to the provincial unified management reform is that the local courts should be funded only by the provincial treasury. This is a completely novel expenditure for the provincial budget and can only be financed through increased provincial revenue. However, a comparative analysis of the increase in the courts’ budget against the incremental revenue increase at the provincial level suggests that almost all provincial-level finances are unable to satisfy such a large increase in funding demand: Tianjin, Guizhou, Beijing, and 10 other regions have experienced a reduction in provincial-level revenues compared to the previous year, and it is simply impossible to spare funding for local courts when existing provincial needs remain difficult to satisfy.

Jiangxi, Yunnan, and Guangdong Province have less than 1.8 billion Yuan of increase in revenue to finance their own budgets, which is far less than the funding needs of local and provincial courts. Even in economically developed regions such as Shanghai and Beijing, budgets were further contracted compared to the previous year, with arranged courts’ budget revenue accounting for less than 2% of the provincial budget. The same lack of financial supply capacity can be observed. (See Table 2)

The lack of financial supply capacity on the provincial level has forced the courts to continue fundraising with the local governments. In the process of fundraising, the local courts will now have to communicate on the one hand with the provincial finance department for more funding, and on the other hand with the local government to compensate for the lack. Having to communicate simultaneously on two administrative levels increases the costs of fundraising for the courts. A further difficulty since the reform lies in the fact that, facing the funding applications from the local courts, the local government can decline their requests using the reform as a legitimate excuse, by saying that the courts have now “completed the provincial unified management reform”, increasing difficulties in fundraising, and potentially deepening local courts’ dependence on local governments.

Reason 2:

The reform asked for formal unified management on the provincial level, while failing to bring about substantial unity in expenses, resulting in the continued imbalance of financial supply capacity within provinces. Firstly, provincial unified management suggests standardization, however, in reality, local standard in labor and public funds still persists, while the funding for case-handling remains insufficiently supplemented. Secondly, the reform also demands unity in expenses, i.e. the amount of funding from provincial expenditure to the local courts should be standardized. But the reality is that the provincial finance department simply required local governments to report the total funding allocated to local courts before the reform, and use this figure as a criterion to budget for local courts for the year. Some provinces with limited capacity to guarantee funding even require the local finance departments to transfer this amount upward, before the provincial finance department then transfers the funding to the courts, so as to achieve formal unified management. Provincial finances in this process did not take effective means to coordinate and adjust the funding budgets to balance the substantial expenditure, and the status quo of having huge gaps in financial capacity among the courts within provinces has not been significantly improved.

Reason 3:

There is a tension between the self-expansionary nature of court funding and the principle of necessity, which prevented court funding from increasing alongside the expansion in courts’ capacity to handle cases. The idea of public finance in principal-agent theory conceptualizes the government as a “trust fund” established to serve the public interest of society, whilst recognizing that the government’s natural tendency of self-expansion may create excessive demand for financial power. Therefore, in order to curb the government’s urge to abuse public finance, budgeting should follow the principle of necessity.

The courts, however, while budgeting for their own expenditures, tend to be self-expansionary: justice is the highest normative value of judicial activities; when justice and economic efficiency are in tension, cost-effectiveness has to come second. Fair and just judicial activities must be backed up by adequate and stable financial resources. However, when reviewing court budgets, finance departments usually follow the principle of necessity and reject the demands to increase budgets alongside the expansion of judicial activities, while the courts themselves have no effective means to reject this practice.

Reason 4: The absence of legislation and policies leads to the lack of legitimacy in the expansion of courts’ power to manage funds

It was clearly stated in “Framework Opinions” that it aims at “the establishment of a provincial unified management mechanism”, i.e. the department responsible for managing courts’ funding is the provincial finance department. The revised budget law in 2018 defines the budget as “public actions involving revenue and expenditure”. The statute did not specify for the normative standard of judicial actions involving revenue and expenditure, which suggests that the state has recognized, on a legislative and policy level, the subordinate status of the court budget in relation to the total public budget. The relationship between the finance department and the courts constitutes a de facto managing-and-managed relationship. Although having provincial courts participating in the management of funds allows for the decision-makers to make informed decisions, the whole process is made difficult due to the lack of legitimacy in the expansion of power.

III. Theoretical reflection on the reform’s “toolbox”

A. The normative components and theoretical toolbox of the court funding guarantee mechanism

Before introducing a theory to transform the court funding guarantee mechanism, it is necessary to clarify its normative outlook. The author examined changes in the PRC’s court funding guarantee system since 1949 and its counterparts in Japan, the U.K., and the United States. She concluded that the court funding guarantee mechanism must determine four core issues in varying political and economic environments: the source of funding, the court funding administrator, the method of ascertaining court budgets, and the authority to review court budgets.

1. The source of funding, or who pays the money

Judicial services maintain social order and justice through the resolution of specific disputes. It is both a private product that protects the legal interests of individuals and a public product that provides legal services to the state. Therefore, when ascertaining the source of funding, there are two available sources, namely, the state and the litigating parties. In cases where the state provides court funding, two sources are available–central government finance and local government finance–depending on the financial condition of each government.

Due to the centralized nature of unitary states, central government finance tends to be the funding provider in unitary states such as Japan and the United Kingdom. On the other hand, the federal countries tend to fund the court through local government finance. For example, the U.S. state courts are financed by state funds. Some other courts are also funded by the litigating parties. The British civil courts, for example, are funded by the case acceptance fee. Although China is a unitary state, Chinese local courts have historically been funded by local government finance because of the country’s vast territory, significant regional differences, and limited central financial resources.

2. The court funding administrator, or who manages and distributes funding

Generally speaking, whoever pays for the funds naturally controls the allocation and management of the funds, so the funding provider is usually the guarantor of court funding. The central government finance is guaranteed by the central government, and the local government finance is guaranteed by local governments. This one-to-one correspondence is particularly prominent during the historical variations of China’s court funding mechanism.

To prevent undue government interference in judicial fairness, many countries have enacted laws or other institutional arrangements that grant the court funding administrator a high degree of independence from the government that provides court funding. For example, in Japan, the Supreme Court is mainly responsible for funding management; the United Kingdom and the United States have set up an independent judicial administrative department for this purpose. Depending on the funding provider and its dynamic interaction with the court, the author identified four main administrators of court funding–the central government, the local government, the Department of Judicial Administration, and the courts.

3. The method of ascertaining court budgets, or how to determine the total amount of funding

Figuring out the quantity of budgetary funds helps the judiciary to secure the resources necessary for it. To ascertain court budgets, there are three methods to choose from: “fixed amount method”, “fixed percentage method”, and “incremental budget increase method”. The four periods of China’s funding guarantee model all rely on the fixed amount method or its modifications, as it is operationally the easiest; the fixed percentage method is more often used in Latin American countries. However, it is not accepted by the mainstream because one cannot quantitatively test and justify the set percentage; the incremental budget increase method, which is the most responsive to the needs of the courts, is used in the United States and the United Kingdom.

4. The authority to review court budgets, or who has the power to review and revise the court budget during budget declaration and approval

Depending on the level of detail that the executive branch reviews court budgets, there are three types of budget review authority: “government departmental review”, “independent review”, and “government departmental review with limited power”. In the government departmental review model, the court budget is a sub-system of the government budget. The government finance department has the strongest scrutiny and involvement in the courts’ budget. In the independent review model, the courts are relatively independent, and the finance department has the weakest scrutiny of the court budgets. The court budget is filed, reviewed, and revised within the court system or by an independent judicial funding management authority. The government has no substantive right to review or revise the court budgets. In the “government departmental review with limited power” model, the court has a say and could participate in the budget review process, but the ultimate review power still lies within the finance department. The model is a compromise between the first two models, but is essentially more inclined to the government departmental review model.

Summary: By comparing the application of the four major types of guarantee tools during various reform periods and in different political entities, the author concluded that the choice of reform tools in the “toolbox” is closely related to the national financial situation, political institutions and the role and function of judicial power in society. The reform plan of court funding guarantee should fully consider the influence of situational variables including political, economic and judicial power. It should also accurately identify the role and function of courts in the national governance structure. To fill the reform “toolbox,” it should choose the appropriate combination of the above 13 tools.

B. Reflections on the problems with the existing reform

Having clarified the reform’s normative outlook and theoretical toolbox, it is necessary to reflect on the tools adopted by the provincial unified management plan. In this way, we could explore the problems in tool selection and application with the existing reform and set up useful precedents for a new funding guarantee mechanism.

1. Confusions in tool selection: the unclear boundary between judicial authority and administrative authority in the judiciary

The unclear boundary between judicial authority and administrative authority in the judiciary has led to the inappropriate mixing of reform tools for judicial funding and judicial administrative funding. Judicial authority refers to the court’s authority to try and legal supervision on behalf of the state, while the administrative authority in the judiciary refers to the power to manage personnel, property, technical equipment and other administrative affairs of the judiciary for the purpose of supporting judicial authority.

The two kinds of authority are essentially different in forms, functions, and substantive contents. The operation of judicial authority should follow the judicial principles and stress judicial independence; the administrative authority in the judiciary should follow administrative principles and stress subordination within the administrative hierarchy. However, in the provincial unified management reform, the two authorities have been confused as the same court functions. The funds for case handling and court facilities, which represent the operating costs of judicial power, and the personnel and public expenditure funds, which represent the operating costs of administrative affairs, are placed in the same guarantee model. The choice of various reform tools has failed to differentiate between the operation of the two powers.

2. Reflection on the choice of tools: the court’s role and function remain unclear, resulting in the deviation of tool choices from the reform’s values

Historical changes in the court’s funding mechanism have shown a continued evolution of the court’s functions. The court’s role in society and the state determines the Party’s policy arrangement of court funding: if the court serves to resolve specific cases and disputes within its jurisdiction, then the court exercises local affairs; as the judicial responsibility should match with the court’s power of finance, the court should be financed by local government. If the court serves to promote the rule of law in social governance at the national level, then the court should be financed by the central government.

Since the founding of the PRC, the court’s role has shifted from a means to an end to an end in itself; from “a political means to realize revolutionary goals” to “a manifestation of value in improving the political system.” The court’s function has been elevated to the level of “providing the foundation of the rule of law for national development.

Accordingly, the court should be funded by the central government. The provincial unified management plan has been aware of the public service provision function of judicial products. It has also established values  such as“de-localization” and “ameliorating the regional divergence in financial supply capability.” Nevertheless, since it still viewed the court’s main role as the settler of specific disputes, the source, and management of court funding remained on a provincial level after the reform, which partially contradicted the reform’s goal of de-localization.

3. Reflection on the application of tools: the insufficiency of financial resources hindered the intended application of tools

The foremost issue of funding reform is to figure out “where the money comes from.” As the leading reformer, the court did not control economic resources. Therefore, when faced with significant financial supply shortages on a provincial level, the reformers sought to avoid the risk of failed reforms. They came up with a compromised but effective method: the courts on each administrative level cooperated with local finances to determine a base amount of funding, which must be no less than the pre-reform amount. The local governments on the same administrative level would then transfer the funding to the provincial treasury, which would then distribute funding to local courts through transfer payments.

This process formally satisfies the requirements of provincial unified management and that the court funding remains no less that the current level. It also seems to push forward the reform. However, the local governments on the same administrative level remained deftly as the actual source of funding. The provincial courts were deprived of the possibility to coordinate the arrangement of provincial funds. The end result of the reform completely deviated from its original intention of shifting the main body of funding guarantee up to the provincial level.

4. Reflection on the implementation of tools: insufficient political resources leads to the lack of internal motivation to enact and push forward the reform tools

The court funding guarantee mechanism reform seems to be a reform within the judiciary. However, because China’s court funding system is decentralized and deeply intertwined with politics, the reform would not only involve a reconfiguration of legal institutions and their respective functions. It would also require adjustments to China’s contemporary legal principles. In practice, both the local financial departments and the provincial financial departments held a passively cooperative attitude toward the reform initiatives, resulting in the initiatives’ weak implementation nationwide compared with other reforms of the judicial system.

The court funding guarantee mechanism reform seems to be a reform within the judiciary. However, because China’s court funding system is decentralized and deeply intertwined with politics, the reform would not only involve a reconfiguration of legal institutions and their respective functions. It would also require adjustments to China’s contemporary legal principles. In practice, both the local financial departments and the provincial financial departments held a passively cooperative attitude toward the reform initiatives, resulting in the initiatives’ weak implementation nationwide compared with other reforms of the judicial system.

 IV. Tool Re-selection: the remaking of the court guarantee mechanism around “separation of the judicial and administrative authorities”

Having reflected on the reform toolbox, the author concluded that the new funding guarantee mechanism should abide by the principle of “separation of the judicial and administrative authorities.” Accordingly, it should apply different funding guarantee mechanisms for judicial and administrative fundings in the judiciary. It should also re-select the source of funding, the funding guarantee administrator, and the reviewer of judicial funding budgets. The reform should also establish a dynamic growth mechanism for court funding centered on the average cost per case.

A. A general change of plan: from single-center provincial unified management to a unified management model based on the judicial-administrative separation

Xi Jinping pointed out that “the judicial power is fundamentally a central governmental affair.” According to the principle that the administrative power should match with the financial expediture responsibility [根据事权与财政支出责任匹配的原则], the main body in charge of judicial expenditure should be the central government. The judicial funding should thus be included in the central government budget and managed by the central government management mechanism yet to be established.

On the other hand, as the judicial administration includes judicial personnel, property, legal infrastructure construction and maintenance, and party and political-administrative affairs, it manifests interactions between the local courts and governments. Compared with judicial power, judicial administrative power demonstrates a clear local feature. Therefore, it should continue with the provincial unified management model, with its funding mainly provided by provincial finance and supplemented by the transfer payment from a national and provincial level.

B. Changing the source of judicial funding: establishing a special fund for judicial activities to guarantee stable funding

The central government finance should collect the litigation fee revenue from all courts nationwide and set up a special fund for judicial expense for case-handling. It should also establish five basic rules to fully implement the “separation of revenue and expenditure” requirement – unified revenue collection and expenditure, earmarking, limitation on carryover and balance surplus, managing surplus/shortage, and auditing and supervision – which would, in principle, prohibit mixing judicial funds with administrative funds. In this way, it provides a stable source of revenue for the central finance to guarantee court case-handling expenditure:

Firstly, litigation fees are capital costs charged by the courts in providing judicial products and services to the litigating parties. Its main purpose is to compensate for the material costs of service provision. Therefore, the use of litigation fee revenue to compensate for the cost of case-handling is justified and reasonable. Secondly, the analysis of the sample courts’ financial data shows that the total litigation fee revenue in 2019 was 27,830 billion Yuan, and the total expenditure on case handling and equipment was 22.266 billion yuan. The litigation fees exceed the court’s case-handling expenditure by 0.25 times, so it is realistic to compensate the case-handling cost with the litigation fee revenue.

In addition, it is necessary to clarify that the use of litigation fee income as a source of financial guarantee for central finance does not violate the principle of “separation of revenue and expediture.” Nor does it mean a rollback to the “revenue generation era” at the cost of litigating parties.

Although the litigation fee is collected by the court, it goes directly into the central treasury. The central treasury is responsible for both the management and expediture of litigation fees after collection, not the courts themselves. This solution is thus in line with the principle of “separation of revenue and expenditure.”

Additionally, through reasonable institutional arrangements, the funding distribution is not linked to the local courts’ amounts of litigation fee revenue. The courts at all levels thus lose the original motive to increase allocated funds by generating more litigation fee revenues.

C. Reforming the court funding administrator: setting up an independent professional institution responsible for the management and allocation of funds.

The Supreme People’s Court should set up a judicial fund management committee. The committee should consist of professionals in charge of managing the judicial funds, which should include financial budget management experts, personnel assigned by the Ministry of Finance, and audit experts. 

Specifically, the committee should: communicate on behalf of the Supreme People’s Court with the central finance department and the National People’s Congress and its Standing Committee; collaborate with the Ministry of Finance to design a set of regulations on judicial fund management and budget filing; be responsible for the budget collection and review of lower courts; be responsible for the budget declaration and responding the questioning of higher administrative institutions; assume internal supervision responsibilities; establish a special inspection system that regularly monitors the exercise of judicial funding.

The provincial courts should set up funding management committees that consist of budgeting, auditing, accounting and other professionals as well as the personnel appointed from the provincial finance departments. The committee should be specifically responsible for communicating with the funding management committee of the Supreme People’s Court, managing and allocating the judicial funds below the provincial level, communicating with the provincial finances, and managing and allocating the judicial administrative funds below the provincial level.

D. Changing the method of determining judicial funding budget: establishing a dynamic budget adjustment mechanism around the average cost per case.

The early stage of the reform: the average cost per case varies from place to place; some courts’ case-handling expenses are intertwined with public expediture of varying amounts; the court financial personnel varies in their professionality; and some financial data lack credibility. To solve the problems, the total amount of funding can be temporarily determined as the sum of the previous year’s case-handling and equipment expenses. The funding can float with the growth or decline in the number of cases handled in the next years.

Trial run phase: Strictly enforce the absolute one-way barrier [单向绝对壁垒]  between judicial and administrative funding; constructing IT infrastructure [信息化建设] under the supervision of the Supreme People’s Court, so that the quality control of data information could improve.

Formal operation phase: After 3 to 5 years trial run, the judicial funding should have basically eliminated administrative funding, and the quality of data should have been effectively guaranteed. Then, the government would collect historical funding statistics and local development indicators and determine key elements such as “the average cost per case,” “the proportion of case categories,” “case growth expectation,” and “local economic development indicators.” In this way, the government could construct a system of indicators and a dynamic funding adjustment mechanism around the average cost per case.

E.  Inheriting and improving the budgetary framework [预算权归属工作]: establishing a judicial budget system led by the judicial fund management committee.

As a legal basis to modify the court budget status in the existing budgetary model is lacking, the court funding reform must be restrained by the governmental sector budget model. Both judicial and administrative funding should also follow the basic principles in the current budget law. However, the Supreme People’s Court judicial funding management committee and provincial court judicial funding management committees could participate in the design, review, and auditing of budget rules. The committees could set up institutional arrangements such as restricting the finance departments’ right to delete or edit court budgets during the review process. In this way, it could effectively exclude undue interference from the administrative branch.

Conclusion

The funding guarantee proposal based on “the separation of judicial and administrative funding” is a problem-oriented one. It also reflects the strategies adopted by the provincial unified management reform. By transferring the litigation fee to the newly established judicial funds in the central government, the proposal could provide sufficient and stable financial resources for the centralized provision of judicial funding; by decoupling judicial funding from provincial finance, the proposal could reduce the provincial financial burden and effectively alleviate funding shortages; by establishing a dynamic adjustment mechanism for judicial funding, which centers around the average cost per case, the proposal could effectively balance the judicial financial supply capacity nationwide; by establishing judicial funding management committees and other professional organizations to participate in the funding management, the proposal could provide an institutional basis for empowering the courts. The funding guarantee model attempts to solve various problems faced by the current reform from the real-world application perspective and thus has a strong practical value.

HOW “CASE LAW” WORKS IN THE CHINESE COURTS–COMMENTS AND RESPONSE

This blogpost sets out the core of Professor Donald Clarke’s comments on the most recent article published on this blog,  Yuan Ye’s HOW “CASE LAW” WORKS IN THE CHINESE COURTS followed by Yuan Ye’s response.

Professor Donald Clarke’s Comments

Professor Donald Clarke, writing on  The China Collection blog, had the following comments :

That observation is that the way Yuan describes cases being used looks very much like a bureaucratic machine striving for error reduction. The imperative driving it is different from that which drives the idea of respect for precedent in a common-law system.

For example, cases more than three years old are not considered very important when searching for the “like cases” that should be treated alike. To me that suggests that the main concern is that the machine at any given time produce consistent judgments. The system is seen as a unified whole, and if it’s doing X at the same time that it’s doing not-X, that’s a malfunction that calls the integrity of the whole machine into question. Inconsistent judgments from a long time ago are less of a concern.

The concerns of respect for precedent are different. In a system that values precedent, the fact that you judged a case a certain way before is precisely a good reason for judging a like case the same way now; by contrast, what other judges in other courts are doing at the same moment you are judging is much less important.

Another thing that stands out in this report is the tremendous amount of work done by court personnel in finding and analyzing (what they consider to be) like cases, in contrast to what is reported to be the virtual absence of input on this issue from the parties’ lawyers. We see this a lot in China. Here is work that could theoretically be outsourced to the parties at their own expense; a conscientious court worried about misuse of cases could still spend time reading the cases cited by the parties, and would still save the time spent having to find them. It’s hard to believe that judges and their interns and assistants have the skills to analyze judicial reasoning in cases, but Chinese lawyers do not. The conclusion would seem to be that this kind of input from lawyers is not welcomed. And again, that makes sense if the primary concern is the efficient and consistent functioning of the judicial machine in the eyes of its personnel. Why would they let outsiders tell them how to do their job?

Response by Yuan Ye

Thank you to Prof. Donald C. Clarke for your kind comments and observations on my note: first, researching similar case is a method the SPC, as “a bureaucratic machine”, uses to reduce error and thus keep itself as a whole; second, there is an imbalance between the work on (re)search similar case done by judges (and their assistants) and lawyers.

Both the comments are very insightful. My response is as follows:

I. The purpose of similar case (re)search: maintain the judicial system as whole

Indeed, retaining or asserting internal administrative consistency, rather than following precedent, is arguably the dominating motivation for the SPC to require searches for similar cases.

According to the first sentence of the Guiding Opinions on Unifying the Application of Laws to Strengthen the Retrieval of Similar Cases (for Trial Implementation) (“《关于统一法律适用加强类案检索的指导意见(试行)》”), the purpose and goal of similar case search is to “unify the application of laws and enhance judicial credibility”. 3 months after the publication of this Guiding Opinion, the SPC issued Implementing Measures for the Work of Unifying the Application of Law (最高人民法院统一法律适用工作实施办法), first article of which the SPC explained the meaning and significance of “unifying the application of law” :

Unifying the application of law in judicial work is not only an inherent requirement for building a sound socialist legal system with Chinese characteristics, but also one of the basic responsibilities of the people’s courts in independently and fairly exercising judicial power according to the law. It provides an important means to ensure the unity, dignity and authority of the national legal system, and is indispensable for improving the quality, efficiency and credibility of the judicial system……

From reading these statements, it is clear that the purpose of promoting a unified application of law is principally to enhance the quality and position of the SPC’s (and all lower courts’) judicial work in the context of the “socialist legal system with Chinese characteristics.”  Therefore, promoting similar case (re)search helps to unify the application of law and “enhance the credibility of the judicial system” and the legal system as a whole.

From a more practical perspective, due to the varying level of development of courts in different cities, there is a widespread phenomenon called “Different Judgment in the Same Case” (“同案不同判”), which is a concern of the central government and SPC. Such divergence has “ seriously affected the public trust of the judiciary”, and many believe that the absence of “case law” is one of the main reasons. Pushing different Chinese courts to apply the same standards helps the judicial system to operate as a “bureaucratic machine” both internally and externally: first internally, different lower courts maintain consistency with the SPC [note that the editor has previously commented that certain reforms are intended to “strengthen the firm guiding hand of the SPC”); and then second externally, to ensure the judicial system (“法院系统”)’s role in the entire Chinese political-legal system and image before ordinary people.

II. The imbalance between the judge (assistant) and lawyer

Generally speaking, Chinese dispute resolution lawyers are far from professional enough to apply “case law” in their work. Some leading law firms and lawyers have promoted case research in their practice and in the whole legal market. The Tian Tong (“天同”) law firm, was likely the earliest to do so. The firm, which I will join on graduation, has “collected, sorted out and refined the adjudication rules of judicial precedents, forming a 42-million-word “Tiantong Code” series(“天同码”), creating a unique case coding system in China” [1] But many lawyers are still not accustomed to searching for prior cases, leaving it out of their routine work.

The uneven level of (case) law education in different law schools has contributed to that imbalance in legal practice. Under China’s civil law system, cases, even Guiding Cases, are not “law” or binding authorities that can be cited as a “basis” for judgments.[2]

Therefore, traditional Chinese law school education is dominated by teachers’ lectures on legal theory, with rare class participation from students, with rare mentions of case law. In my undergraduate law school, the typical class scene was that the teacher read  PowerPoint slides at the front of the class, with the students taking notes on what the teacher said. The main questions on the exams were also discussions of specific legal theories rather than issue spotting.

Things started to change later when some leading law schools had introduced Appraisal Case Analysis (鉴定式案例分析法), a concept borrowed from German law schools, or using other case law teaching methods to enhance the quality of legal education.[3] For example, Peking University Law School [in Beijing] has introduced a series of case law seminars ranging from civil law to criminal law and related procedural law into its teaching.[4] STL is of course also an excellent example of implementing US-style case law education in its daily teaching of Chinese law.[5] However, such new efforts are still limited to a few leading law schools and more time is needed for law school graduates to become experienced lawyers who are capable of using case law in their work.

Courts in developing cities are much less attractive for graduates from leading law schools, and therefore judges in those courts are less familiar with the appropriate way to apply case law than those in developed cities. Therefore, the imbalance is not only between judges and lawyers but also between legal practitioners in different cities.

Another reason behind the imbalance is the “inquisitorial system” adopted by Chinese courts. In contrast to the adversarial system under common law, Chinese courts, when facing parties and their lawyers, have greater authority, having the power to decide the process and results of the judicial process. The lawyers involved are only “necessary” or “useful” when the court believes so. Therefore, lawyers generally lack incentives and confidence to pay more attention to the legal and case (re)search, because there have been many times under which the courts simply ignore the lawyers’ efforts.

[1] http://www.tiantonglaw.com/AboutUs/.

[2] Detailed Rules for the Implementation of the Provisions of the Supreme People’s Court on Case Guidance (《〈最高人民法院关于案例指导工作的规定〉实施细则》) article10: “Where a people’s court at any level refers to a guiding case in the trial of a similar case, it shall quote the guiding case as the judgment’s reasoning, instead of citing it as the basis for the judgment.

[3] See basically Huang Hui, The Basis and Technology of Appraisal Case Analysis, available at https://stl.pku.edu.cn/cn/stl-news/%E9%BB%84%E5%8D%89%E7%BC%96%E8%AF%91%EF%BC%9A%E3%80%8A%E9%89%B4%E5%AE%9A%E5%BC%8F%E6%A1%88%E4%BE%8B%E5%88%86%E6%9E%90%E6%B3%95%E7%9A%84%E5%9F%BA%E7%A1%80%E4%B8%8E%E6%8A%80%E6%9C%AF%E3%80%8B/. For law schools that are promoting Appraisal Case Analysis, see Fudan University Law School at https://law.fudan.edu.cn/74/37/c27189a291895/page.htm, Nankai University Law School at https://law.nankai.edu.cn/2021/0823/c4826a387157/page.htm and Zhongnan University of Economics and Law at http://law.zuel.edu.cn/2021/0623/c3752a274061/page.htm.

[4] https://www.law.pku.edu.cn/xwzx/xwdt/138645.htm.

[5] https://mp.weixin.qq.com/s/sb1M6wkxtIKq5jZ2L-KPGQ.

How “Case Law” Works in the Chinese Courts

By (袁野) Yuan Ye, 4L student, Peking University School of Transnational Law, edited by Susan Finder

As a  JD/JM student at the School of Transnational Law (STL) of Peking University, and an LLB student at Xiamen University School of Law, I have had the opportunity to intern in courts at three of the four levels of the Chinese courts in three different cities. One of the tasks that I have often undertaken for the judge to whom I was assigned is searching for similar cases. Most often, my work was first submitted to the judge’s assistant, who thoroughly reviewed my work before he (or more often she) forwarded it to the judge. Similar case search is required by applicable legislation and SPC policy.  The search and application of similar cases(“类案”) are now required to ensure the “uniform and proper implementation of laws” during the case hearing (adjudication) process (审判过程) in Chinese courts. ”) Under that cited guidance, the SPC defines the “unified application of the law” to include “various work for promoting the unified and correct application of the law, such as drafting and enacting judicial interpretations and other normative documents, releasing [typical and guiding] cases, implementing a retrieval system for similar cases, and holding professional judges meetings to discuss cases.”

My description of a typical search, research, discussion, and application of similar cases is based on my own experience and that of some of my STL classmates.

I. The (re)search of similar cases

A. Why (re)search similar cases?

During my internship at the Third (#3) Circuit Court of the SPC in 2018, the search of similar cases, at least in my observation, had not yet become required by SPC regulations. [Note that the editor had mentioned that SPC judges (and their assistants) were searching for similar cases in her 2017 article in the Tsinghua China Law Review.] However, some judges and judge assistants,  whom I discovered were much more professional than I thought, had already  (re)searched and applied analogous “similar” cases to cases under consideration.

For example, in a review report (“审查报告”) [explained in the linked article] of a complicated retrial case handled by my trial team, the judge’s assistant cited several cases that raised the same issues as authority to support her proposed holding. One case that she cited was decided by the 1st Circuit Court, which is opposite to the assistant’s position; and others were from High Courts, supporting her position. The assistant also analyzed in detail the reasoning behind the 1st Circuit case and refuted it, point by point. The whole process of applying “similar cases” was very thorough and professional.

Another good example was that in dealing with a cutting-edge case, a judge in charge (承办法官) asked all interns in the court to search for similar cases from the United States, because he knew, as an SPC judge, that there was no precedent for reference in China. The SPC regulation requiring a search of similar cases was not published until 2020, so why, in 2018, had the judge and his assistant started the search and application of similar cases—even US cases? In my mind, the motivations were quite simple and straightforward: they knew case law is practically useful and even indispensable in adjudication. (The  fiduciary duty of asset managers provides a good example.)

Also, an SPC judge and judge’s assistant enjoy a great deal of freedom and discretionary power in deciding cases, so they felt comfortable applying case law in their work. At that time, the ordinary legal community (law schools and students, lawyers, scholars, etc.) was still unfamiliar with case law, not to mention (re)search and use of cases in legal education and research. [Note that in 2016, the editor wrote that lawyers and some judges used case law.]  So, when I read that review report, I felt it a great pity, thinking how wonderful it would be if such an excellent application of case law could appear in the final judgment. Because it was the SPC, its judgment applying similar cases would be a good example and strong signal for the legal community: it is time to use case law.

In 2019, during a talk with an SPC judge in the 3rd Circuit, I heard that a leader in SPC, who was a vice president of the 3rd Circuit, required that all judges and their assistants attach a list of similar cases at the end of their retrial review report, to show the results of their case search. I think it is a good illustration of how certain SPC regulations come into being: first some judges engaged in a practice, then more judges joined and created a consensus, and finally leaders approved and made it a formal rule. I believe this is how (re)search of similar cases become a legally required obligation.

As of now, searching for similar cases has become a legal obligation and the scope of cases requiring the search is nearly unlimited. In practice. Few will question the necessity and legality of case research. In other words, as long as making a judgment of the case requires something more than a direct application of statutes, the research of similar cases is then a necessity of legal research rather than a simple internal procedural requirement. Such awareness has become a consensus of many judges and judge’s assistants in Chinese courts, especially those working in developed cities.

B. What is a similar case?

According to Article 4 of Guiding Opinions on Unifying the Application of Laws to Strengthen the Retrieval of Similar Cases published by the SPC in 2020, 7 sets of cases can be searched and used: guiding cases, typical/model cases issued by the SPC, other SPC cases, reference cases issued by High Courts, other High Courts cases, any cases from higher courts and previous cases decided by the court in question[1] These cases form a pyramid of guiding effect, with the Guiding Cases that all courts must follow at the top, and previous cases of a local court at the bottom. It can be derived from this article that, two types of logic apply to the pyramid: one is the logic of administrative levels, from the SPC to district courts; the second is time: cases from more than three years ago are less worth reviewing.

The practice I experienced was similar to the rules encapsulated in Article 4. When searching cases, it is rare to find a similar Guiding Case because there are only 173 Guiding Cases, as of the end of 2021. Then other SPC cases are always first searched. If none are found, people would turn to higher people’s court cases.  The search for cases from Intermediate Court or even District Courts is only persuasive when the court is of the same level or lower level. For example, during my internship in the Shenzhen Futian District Court, I felt comfortable looking at cases decided by Shenzhen Nanshan District Court. I would be much less confident to do so if I were in the 3rd Circuit.

Under Article 4, almost all cases judged by Chinese courts may be regarded as “similar” cases, as long as they are “similar” to the one at hand. How should similarity be determined? The legal definition is far from clear.[2] Based on my experience, the similarities can be reflected by a wide variety of factors, including:

  1. The same or similar factual factors. E.g., parties involved, type of transaction, markets, and regulations under which the transactions occurred
  2. The same or similar legal issues. The analogy may be based not only on specific legal reasoning but more often on the applicable legal theory under the Chinese civil law system. For example, a commissioning contract  (“委托合同”) is a type of typical statutory contract under the Chinese Civil Code.[3]  The search of similar cases to determine the duties of the commissioned party when managing the commissioning party’s assets is conducted under the category of commissioning contract, although the legal reasoning behind is probably fiduciary duty under trust law.
  3. The same or similar procedural factors, such as the same courts, higher courts of this court, courts in the same position, or similar cities (such as the comparison of cases between Beijing Financial Court and Shanghai Financial Court).

I believe that leaving the definition of similarity vague is actually a good choice for Chinese courts to apply similar cases. Not all judges, especially those from lower courts, are familiar with the process of case analogy or distinguishing one case from another.  Given this situation, leaving the discretionary power to determine whether a case is similar to the one under consideration would lower the barriers to applying case law.

C. How to (re)search similar cases

The judge in charge of handling the case is called the “承办人”, who bears the legal obligation to search similar cases.[4] But in practice, the search is conducted by the judge’s assistant. If the judge’s assistant has a law student intern, typically, the intern will first do the search for similar cases to consider how best to decide the legal issues that are disputed in the case.

The China Judgments Online (www.wenshu.court.gov.cn) is the recommended database for similar case search, but no one would really care or question which database a similar case comes from.  Different people may use different databases. For me, I used China Judgments Online in the 3rd Circuit Court of the SPC most. But later, the connection to this website has gradually become unstable, so I turned to the commercial databases Wolters Kluwer and Beida Fabao (“北大法宝”). To check the original version of a case, I searched China Judgments Online because it is the only official database published by the SPC, from which all other databases crawl data.

The SPC also required that “courts at all levels” increase the efficiency of case search by using AI technology[5] and “all high people’s courts shall…establish a trial case database”[6] Under the ideal scenario, the AI system will “push” similar cases to the judge (assistant) handling the case. For example, Shanghai courts have adopted a “Shanghai court data system for trial assistance” and which has become “a necessary assistant for the judge.”[7] During my internship, I only tried that  system a few times and did not rely on it much, because the similar case pushed on the screen is often insufficient or not as accurate as it is supposed to be. And the push of similar cases can only be done on specific computers connected to court’s intranet, which is not always easy and convenient. However, my experience is limited to the courts in which I have interned and the use of AI in similar case searches may become more widespread and convenient.[8]

Several factors are often used as filters when searching cases in a database. In my experience, the one used most often is “案由”, [cause of action] which signals the basic legal relationship between the parties involved. Keywords expressing legal issues under Chinese civil law theory are also very useful, for example, the fiduciary duty is generally expressed as “勤勉尽责” in Chinese civil law, so this word should be used as a keyword.

It is important to note that the structure of Chinese court judgments (and rulings) is basically the same, with each part starting with the same fixed words, making the search of cases easy. For example, the holding’s reasoning always starts with “本院认为”(“this court holds that”), so it is very convenient to check whether a case is useful by locating this keyword first.

II. The use and application of similar cases

The first step after finding similar cases is for the person handling the case to analyze and apply the reasoning of similar cases (if any) to the issues of the case under consideration, or distinguish them. If any party involved has cited a Guiding Case or another similar case previously decided by the SPC in their arguments, the review report or trial report (both the review report and trial report (审理报告) are types of bench memorandum used in the Chinese courts) must then include a response to the cases cited and an explanation of whether to follow the cited case or not. The collegial panel also discusses whether the cases cited by the parties are applicable during their meeting. [9]

If the collegial panel finds that the case under consideration is analogous to a guiding case, the collegial panel is under a legal obligation to apply the guiding case reasoning to the current one.[10] If the judges take the view that the current case should be distinguished from the guiding case, the draft judgment must be submitted to the Professional Judges Meeting (“专业法官会议”) or on some occasions, directly to the judicial (adjudication) committee(“审委会”) to determine (or decide) whether the collegial panel has properly distinguished the guiding case or SPC case.[11]

In my experience, it is rare to see parties citing useful cases as authority to support their position. In my view, lawyers who are capable of using case law account for a small portion of the entire legal market. There’s still a great deal of work to be done to promote the application of case law, both for lawyers and judges.

III. The report, discussion and archiving of similar cases

For almost all cases,[12] it is required that similar cases be listed and explained in the trial report (审理报告 or review report) compiled as a separate report and attached to the case file. In most cases, similar cases are demonstrated by a  copy of its full text or by a brief summary or an excerpt of its facts. Usually, the reasoning of similar cases will be fully copied there, but without further analysis of its applicability. In other words, the list or report of similar cases is usually very simple and straightforward. Readers will find it hard to grasp the link to the current case without any explanation from the person handling it.

Later, the list or report is submitted to all meetings at which the case is discussed, such as meetings of the: collegial panel (“合议庭”),  professional judges committee (“专业法官会议”), state compensation committee,  or the judicial (adjudication) committee (“审委会”).[13] During the oral report of the case, the person handling the case will introduce the similar cases found, either briefly or thoroughly (depending on the case). The introduction is not just to determine the merits of the case, but also for the judges to be aware of the possible political or social implications of the draft holding. For example, if the judge in charge of the case or the collegial panel proposes distinguishing similar SPC cases found or guiding cases, the professional judges committee or other court committees will generally be very cautious in supporting such proposal.

Once similar cases are attached to the case file in the form of an independent report, the report is incorporated into the case auxiliary (secondary)  file (附卷, discussed here).  As a constituent part of the case file, the similar cases and related report are forwarded wherever the case file goes (appeal or retrial), and ultimately archived.  Part of SPC policy is to move to electronic files and electronic archiving of files (now being piloted). Because the similar cases and trial or review report are part of the auxiliary or supplementary file, it means the parties involved have no access to them.

_____________________________________________________________________

Yuan Ye worked as intern judge’s assistant at the Third Circuit Court of the SPC from February to August 2018; at Shenzhen Futian District Court from May to June 2021, and at Shanghai Financial Court from March to May 2022.

[1] “The retrieval scope of similar cases generally includes: 1. guiding cases issued by the SPC; 2. model cases issued by the SPC and cases in which the judgments made by the SPC have taken effect; 3. reference cases issued by the higher people’s courts of the provinces (autonomous regions or municipalities directly under the Central Government) and cases in which the judgments made by such courts have taken effect; and 4. cases in which the judgments made by the people’s court at the next higher level or this people’s court have taken effect. In addition to guiding cases, priority shall be given to cases in the past three years; and where similar cases have been retrieved already in the previous order of precedence, the people’s courts are not required to retrieve more cases.”

[2] Ibid, Article 6: “A judge handing a case shall identify and compare the similarity between the pending case and the retrieval result to determine whether it belongs to a similar case.” No other legal definition of similar cases is provided by laws.

[3] Article 919 of China Civil Code: “A commission contract of mandate is a contract whereby the commissioning party and the commissioned party agree that the commissioned party handles the affairs of the commissioning part.”

[4] Notice by the Supreme People’s Court on the Guiding Opinions on Unifying the Application of Laws to Strengthen the Retrieval of Similar Cases (for Trial Implementation) (“最高人民法院印发《关于统一法律适用加强类案检索的指导意见(试行)》的通知)” Article 3: “A judge handling the case shall retrieve similar cases based on the China Judgments Online (www.wenshu.court.gov.cn), the trial case database, etc., and be responsible for the veracity and accuracy of the retrieval.”

[5] The use of AI has been regarded as a key step to create Smart Courts (“智慧法院”), see Opinions of the Supreme People’s Court on Accelerating the Construction of Smart Courts(最高人民法院关于加快建设智慧法院的意见)art.14 to art.18.

[6] Circular of the Supreme People’s Court on Issuing the Guiding Opinions on Unifying the Application of Law and Strengthening the Retrieval of Similar Cases (for Trial Implementation) (“最高人民法院印发《关于统一法律适用加强类案检索的指导意见(试行)》的通知”) article 12: “People’s courts at all levels shall actively promote the retrieval of similar cases, strengthen technology research and development and application training, and enhance the intelligence and precision of similar case push. All high people’s courts shall make full use of modern information technology to establish a trial case database and pave the way for the development of a unified and authoritative trial case database nationwide.”

[7] See Artificial Intelligence Makes Judicature More Just, Efficient and Authoritative–the Theoretical Analysis and Practical Exploration of Artificial Intelligence in Judicial Field (“人工智能让司法更加公正高效——人工智能在司法领域应用的理论分析与实践探索”), Cui Yadong(崔亚东), ChinaTrial(中国审判), 2017, available with translation at https://law.stanford.edu/china-law-and-policy-association-clpa/articles/. The author is the President and Chief Justice of Shanghai High People`s Court.

[8] More provinces have adopted an AI similar case push system, such as Liaoning and Inner Mongolia: see http://ln.people.com.cn/n2/2020/0803/c378317-34200689.html and https://mp.weixin.qq.com/s/toKUtOcSv2Ai-THiQwlKiQ respectively.

[9] Implementing Measures of the Supreme People’s Court on Harmonization of the Application of Laws (Fa [2021] No.289) (“《最高人民法院统一法律适用工作实施办法》”,(法〔2021〕289号))”, Article 8: “For the cases for which similar cases shall be retrieved as provided in Article 6 hereof, the collegial panel shall include the harmonized standards for the application of law for the cases in the content of deliberation. During the trial, where the public prosecution organ, the parties concerned and their defenders or agents ad litem submit the guiding cases or the effective judgments of the Supreme People’s Court of similar cases in support of their claims, the collegial panel shall include whether the submitted cases or the effective judgments and pending cases belong to the similar cases in the content of deliberation.”

[10] Implementing Measures of the Supreme People’s Court on Harmonization of the Application of Laws (Fa [2021] No.289) (“《最高人民法院统一法律适用工作实施办法》”,(法〔2021〕289号))”, Article 9: “If a pending case is similar to the guiding case retrieved in terms of basic merits and legal application, the collegial panel shall make a judgment with reference to the main points (裁判要点) of the guiding case. In the judgment with reference to a guiding case, the guiding case shall be cited as the reason for judgment, but shall not be cited as the basis for judgment. If a guiding case is cited in the reason for judgment, the number of the guiding case shall be indicated.”

[11] Implementing Measures of the Supreme People’s Court on Harmonization of the Application of Laws (Fa [2021] No.289) (“《最高人民法院统一法律适用工作实施办法》”,(法〔2021〕289号)), Article 10: “ Where the proposed judgment results of a pending case are inconsistent with the application of law standards for guiding cases and the judgments of the Supreme People’s Court for similar cases, or the proposed judgment results will form new standards for the application of law, the collegial panel shall suggest submitting the case to the departmental professional judges session for discussion; if the president or chief judge finds that a pending case has any of the aforesaid circumstances, the departmental specialized judges session shall be convened as required to discuss the case. Where it is inappropriate to submit the cases specified in the preceding paragraph to the professional judges session for discussion due to confidentiality and other reasons, they shall be reported to the leader in charge of the People’s Court level by level for approval, and may be directly submitted to the Judicial (Adjudication) Committee for discussion.”

[12] Implementing Measures of the Supreme People’s Court on Harmonization of the Application of Laws (Fa [2021] No.289) (“《最高人民法院统一法律适用工作实施办法》(法〔2021〕289号)”) Article 6: “If a case in handling has any of the following circumstances, the responsible judge shall retrieve similar cases: (1) The case is proposed to be submitted to the judicial committee or the specialized judges session for discussion; (2) The case lacks specific judgment rules, or has not yet reached unified judgment rules; (3) The case is major, difficult, complex and sensitive; (4) The case involves group disputes or raises widespread social attention, which may affect social stability; (5) The case may conflict with judgments of the Supreme People’s Court on similar cases; (6) Relevant entities or individuals allege that the judge has conducted the trial in violation of the law; (7) The Supreme People’s Procuratorate has protested; (8) During the trial, the public prosecution, the parties and their defenders, or agents ad litem submit guiding cases or the effective judgments of the Supreme People’s Court on similar cases to support their claims; and (9) The president or chief judge retrieves similar cases in accordance with the authority for trial supervision and administration. For the retrieval of similar cases, it is allowed to retrieve only the guiding cases released by the Supreme People’s Court and the effective judgments of the Supreme People’s Court.

[13] Implementing Measures of the Supreme People’s Court on Harmonization of the Application of Laws (Fa [2021] No.289) (“《最高人民法院统一法律适用工作实施办法》(法〔2021〕289号)”) Article 7: “For cases for which similar cases shall be retrieved pursuant to the provisions of Article 6 hereof, the responsible judge shall provide an explanation on the retrieval of such cases in the trial report, or prepare a special retrieval report for such cases. The retrieval explanation or report for similar cases shall reflect the retrieval results of such cases objectively, comprehensively, and accurately, and shall be submitted together with the collegiate bench for deliberation or the specialized judges session, the compensation committee, the judicial relief committee, and the adjudication committee for discussion. The retrieval report for similar cases shall be incorporated into the auxiliary file together with the case.”

Supreme People’s Court’s New Policy on Providing Judicial Services and Safeguards for the National Strategy on Aging

In late March, the Supreme People’s Court issued its Opinion on Providing Judicial Services and Safeguards for Implementing the National Strategy for Actively Addressing Population Aging (Population Aging Opinion, 最高人民法院关于为实施积极应对人口老龄化国家战略提供司法服务和保障的意见).  The SPC issued a set of typical cases to illustrate specific issues for the lower courts and the general public, consistent with the developments discussed in my last blogpost.  The National Strategy itself is found here.  I have also found that the Asian Development Bank is providing technical support for the National Strategy, although it does not appear the technical support extends to legal aspects.  The National Strategy contains the core of some of the principal measures of the Population Aging Opinion. When I read the Population Aging National Strategy, I knew that the SPC would issue a corresponding judicial services and safeguards opinion because I noticed certain provisions related to the courts and knew (from writing an old blogpost) that the legal infrastructure related to the elderly, including the systems promoted by the courts, has lagged behind the needs of the aging population.

A brief summary of the Population Aging Opinion follows, along with a bit of background information and some very brief comments.

Background

It is one of the latest in a large number of “judicial services and safeguards” (also translated as guarantees) documents, usually issued in the form of opinions, that the SPC has issued in the Xi Jinping New Era.

Although this steadily growing group of SPC documents has not attracted much attention by either academics or practitioners, I take the view that they are worthy of further attention, as they illustrate a number of New Era themes. This blog has published a number of analyses of earlier judicial services and safeguards opinions and I have written two book chapters related to services and safeguards opinions as well. These opinions package related measures, some relating to substantive and procedural law and some related to administrative matters, as broadly understood. The SPC flags legal issues (relevant to the courts) in these opinions. What it flags imbeds the SPC’s analysis of the possible impact of the national strategy or policy on the courts and relevant measures needed to fulfill the obligations of the courts under the strategy or policy. The SPC tweaks judicial policy to respond to the implications of the national strategy or policy.  Follow-up measures implementing specific provisions are usual, as the Population Aging Opinion illustrates.

From having read the Shanghai Jingan District People’s Court 2020 White Paper on protecting the rights of the elderly,  knew that the SPC was aware that the aging of the Chinese population is having an impact on the court system, That court has had a specialized division focusing on the elderly for thirty years, although the title of the division has evolved along with related court policy I.  I recommend the White Paper to any readers who are interested in elderly-related issues in China.

Specialized focus on legal issues related to the elderly does not seem to be widespread either among practitioners or academics. From my inquiries with those teaching in Chinese law schools and in legal practice in China, elderly law is new.  The Ministry of Justice issued a notice on legal services for the elderly, but I surmise that the notice caught few persons’ attention with the nationwide concern about the spread of Omicron in China and lockdowns across many Chinese cities.

The SPC’s #1 Civil Division led the drafting of the Population Aging Opinion. That division that is in charge of “traditional” civil law matters, such as family law disputes (including inheritance, marriage, divorce, and support), as the explanatory press release was entitled as “a responsible person of the #1 Civil Division ” answers questions about the Population Aging Opinion. It is clear that the drafters also consulted with colleagues in other SPC divisions, as many provisions relate to matters outside the competence of the #1 Civil Division.  This type of package document effectively coordinates different divisions and offices of the SPC to work together toward fulfilling the SPC’s responsibilities in making the national strategy successful.

The Population Aging Opinion is relatively short, especially when compared to the Belt & Road-related Opinions.  It has three sections: the introductory one, framing the political background; the second, on maximizing adjudication functions; and the third, one on reform-related matters.

Political framing

The Population Aging Opinion is linked to last November’s National Strategy. This section is typical of the introductory section of services and safeguards opinions. It calls for courts to raise their political positions, adhere to the guidance of Xi Jinping thought,  and now that Xi Jinping legal thought has been canonized, implement those principles as relevant to the protection of the rights of the elderly.  Harmonizing with greater themes in Xi Jinping thought, the part relating to guiding ideology reiterates the importance of traditional Chinese values.   Those values are the “traditional Chinese virtues of filial piety and respecting the elderly.”  The range of disputes mentioned in the second part and the typical cases signal that traditional virtues of filial piety seem to be respected in the breach among some part of the Chinese population.

2. Maximizing adjudication functions

This section is the longest (as is typical with such documents) and a careful reader can easily see typical legal problems that appear in the Chinese courts that involve the elderly.  Typical of services and safeguards opinions, each article packages a number of sub-issues. This section includes articles on elder care, including services contracts and occupancy rights (Article 8); rights of rural elderly to land (Article 9); disputes over medical service contracts (Article 10); employment rights of the elderly (Article 11); cracking down on crimes against the elderly, including elder abuse and elder fraud (Article 12).

This analysis focuses on the following four groups of issues: 1) marriage and family cases; 2) inheritance; 3) domestic violence; and 4) guardianship issues.  Most of these issues are common to other societies around the world.

  1. Article 4 relates to marriage and family cases. The first sentence,  “cases regarding disputes over the support for the elderly shall be tried in accordance with the law to guarantee the basic living needs of the elderly” signals that many disputes relating to the elderly involve the failure of grown children to provide financial support for the elderly. This is also flagged in accompanying typical case #3 and other SPC typical cases.  The Population Aging Opinion calls for using mediation to encourage sons and daughters to provide “spiritual support” (such as visitation) for the elderly, an obligation now incorporated into the Civil Code. Because it reiterates that older people enjoy freedom of marriage,  it signals what the SPC states explicitly in the typical cases, grown children are too often interfering in the divorce of their parents or the second marriage of a parent.  The Jingan Court White Paper noted a steady increase in the number of divorces among the elderly:

The steady rise in the number of divorce disputes reflects, to some extent, the changing understanding of marriage among older people, whose expectations of “old age” are not only limited to making do with what they have, but are becoming more aware of the need to truly follow their heart and actively strive for their own happiness in their old age.

The last provision in Article 4 responds to the increasing number of property disputes involving elderly people who cohabit, reminding lower court judges to consider the period of time the couple lived together, the contributions made by both parties, the interests of both parties shall also be considered, and other factors so that these disputes can be fairly decided.

Article 5 relates to inheritance and wills and signals that the wishes of the elderly should be respected. It flags the system of estate administrators, now incorporated into the Civil Code, apparently a concept adapted from Taiwan’s legal system.  This recent article published by the Shanghai Bar Association has a useful update.

Article 6 relates to elder abuse, calling for the better protection of the personal safety and the property of the elderly, calling for better coordination among related departments.  The first typical case involves elderly abuse. Article 6 calls for improving guidance on the burden of proof for elderly victims, better linkage with psychological counseling, and priority status for victims of elder abuse.  A quick search of the public health literature finds studies on elder abuse in China, particularly in rural areas and among the less educated, and that Covid-19 has had a negative impact.  One study found that much of the abuse was either neglect or financial abuse. This article, summarizing and analyzing a survey by the national and local aging authorities, found that at least 60% of respondents reported some type of abuse, either physical, mental, intimidation, or violation of their legal rights.

Article 7 concerns guardianship.  It encourages the elderly to issue an advance guardianship directive.  It reflects special concerns about abuses committed by guardians when the elderly person is in some way capacitated and those who abuse the guardianship system for their own benefit, also reflected in typical case #2.

3. Reform measures

The third section of the Population Aging Opinion concerns judicial reforms to be applied to aging issues.  Among those are:

  • the Fengqiao experience (here referring to diversified dispute resolution), and integrating the resolution of elderly-related disputes in cross-institutional arrangements involving the courts at the basic level.
  • integration of socialist core values into the trial of cases involving the elderly: and family trial reforms.
  • The last article concerns improving case registration and other services related to elderly persons filing a case.  This article likely involved input from the SPC’s case registration division and some type of guidance, either publicly available or internal can be expected. Although the Chinese courts are promoting smart courts, this last article recognizes that many elderly either need in-person, phone, or other non-smartphone procedures, or an assistant to help them access court facilities.

Concluding comments

Many of the issues addressed in the Population Aging Opinion are not limited to China, whether it is elder abuse, abuse of guardianship, re-marriage of the elderly, employment rights of the elderly, or medical care contracts.  Elder law issues could possibly be a useful area in which the Chinese courts (perhaps in cooperation with one of the Chinese law schools), could engage with international specialists in a workshop setting and share experiences.  It is likely to be seen as an area of “foreign beneficial experience.”

More on Supreme People’s Court Typical and Major Cases, or How Typical Cases are “Tempered”

Because the Supreme People’s Court (SPC) is now issuing more and more typical cases, likely because General Secretary Xi Jinping has said “one case is better than a dozen documents (习近平总书记强调, “一个案例胜过一打文件”), this blogpost will provide more background on the Supreme People’s Court’s (SPC) typical (典型案例) and major cases (十大案件). It includes a general description of how typical cases are “tempered.”  For those who miss the reference, it’s to the old Russian book “How Steel is Tempered, pictured above. My understanding is that “major cases” are considered a type of “typical case” for the purposes of the SPC’s required search of cases under its 2020 guidance and so I’ll use the term “typical case” to cover both major and typical cases. I have not seen official definitions of either term.

I’ll first summarize how the SPC views the role of  “typical cases” and the legal basis for issuing them, drawing on what I have previously written and a draft article on the long road to publication,  and then explore a topic little explored in English–how the SPC compiles or edits (the Chinese term is 编写) typical cases.  I have not seen a Chinese article that sorts out the various types of typical cases systematically. As readers of this blog know, I have long had an interest in Supreme People’s Court (SPC) typical /model/exemplary cases( 典型案例) and related types of cases such as major cases (大案件).

The Role of Typical Cases

The SPC issues typical cases as part of its function to supervise and guide the lower courts, deriving from Article 10 of the Organic Law of the People’s Courts. The SPC has done so for many years. However typical cases have taken on a greater role in the Xi Jinping New Era, symbolized by the quote above.

Guiding the lower courts

Typical cases are a type of SPC soft law.  They are a tool by which the SPC seeks to unify the judgment (adjudication) standards of the Chinese courts.  As mentioned before, they are a means by which the SPC seeks to harmonize the decisions of the Chinese courts to be consistent with SPC policy (or said another way, strengthen the firm guiding hand of the SPC).

That guidance can relate to substantive or procedural issues, because the issues that come before the Chinese courts far outpace the infrastructure of existing law, including judicial interpretations. Additionally, given the role of the SPC in social governance, typical cases also enable the SPC to do its part to further the latest Party policy. This is more complex than appears. One aspect relates to issues at the intersection between law and morality, such as the second batch of cases in which the people’s courts promote socialist core values.

Guiding the General Public

The SPC issues typical cases to guide the general public to fulfill its obligations under the popularization of law responsibility system established through a 2017 Central Committee State Council document and implemented through an inter-ministerial joint conference on the popularization of law,   Section 6 of that 2017 documents calls for judge, procurators, administrative enforcement personnel, and lawyers to establish a “using cases to explain the law” system.  The document calls on judges, etc. to collect, sort, research, and issue cases and establish a database, using typical cases for the purposes of guidance, standardization,  prevention,  and education. At the end of 2017, the SPC issued its own document to implement the Party-State Council document, 人民法院贯彻落实〈中共中央办公厅 国务院办公厅关于实行国家机关“谁执法谁普法”普法责任制的意见〉的实施意见》(SPC Explaining the Law Opinions), with several articles promoting the use of typical cases to educate the public.  In January of this year, President Zhou Qiang publicized ten cases illustrating the rule of law in the New Era, praising each case as illustrating the vivid practice of Xi Jinping’s rule of law thought in the people’s courts, and the concentrated embodiment of socialist core values ​​and the spirit of the rule of law.

The cases selected and the extent of detail in typical cases intended to guide the general public are different from those intended to guide the lower courts.

How SPC typical cases are “tempered”

I draw on some writings on how to write  (the Chinese term is 编写, closer to compile) a model case, instructions to the lower courts on how to submit a case,  and the “revolutionary experience” (革命经验) of several friends who have been on the editorial side of typical case publishing to explain how SPC typical cases are “tempered.”    Several have been on the drafting side as well as the editorial side.  Judge Guo Feng’s description of compiling guiding cases also provides insights.

Which SPC institutions issue major and typical cases?

Major cases

The SPC and its constituent divisions and institutions (this is meant to include the China Institute of Applied Jurisprudence and the National Judges College) issue typical cases and major cases.  I am not aware of a document that distinguishes major cases from typical cases. I’ve noticed “10 major cases” in the areas of intellectual property, commercial, and drugs crime law ), but those announcements do not distinguish major from typical.  I surmise the notice that the SPC sent to the lower courts soliciting submissions for major and typical cases sheds some light on the difference, but I have not come across such notices.

Annual major intellectual property cases (and annual typical intellectual property cases are issued by the SPC General Office.  It is my understanding that judges from the SPC Intellectual Property Court (SPCIPC) and #3 Civil Division (in charge of intellectual property) recommended the selected cases.

The #2 Civil Division selects the 10 major commercial cases announced annually.  The 10 major typical drugs cases have been selected by relevant departments of the SPC, perhaps meaning the Research Office together with one of the Criminal Divisions.

I surmise that the vice president in charge of the relevant division or matter has approved their release.

Which SPC institutions issue typical cases?

This expanded, but likely incomplete list supplements an earlier blogpost in which I listed SPC institutions that issue typical cases.  I am not aware of rules governing the approval of SPC typical cases and so the process is understood to be flexible.  It is my understanding from discussions with knowledgeable persons (and as I have written before), that customary practice governs the approval process.  It appears to often be the vice president responsible for the division or institution, possibly involving the SPC President himself.

  1. The SPC General Office (办公厅), edits the Supreme People’s Court Gazette (最高人民法院公报). Readers of this blog should note that the web version does not include all content of the Gazette, unlike the Gazette of the State Council. As an aside, it is unclear how publicity to the reading public is promoted if the full version is not available online.  It appears to be generally inconsistent with the practice of other supreme courts.    The cases in the Gazette include selected court documents (裁判文书选登) and cases  (案例), generally totaling 20-30.  The first type is cases decided by various trial divisions of the SPC and reflects their views on certain issues, while the second type is model cases submitted by the local courts (through the provincial high courts), which have been reviewed by the editor of the Gazette, conferring with the various trial divisions of the SPC if needed.  These cases are considered to be more technical within the court system and are widely considered when judges undertake the required similar case search.
  2.   The SPC  General Office issues monthly SPC typical cases (available here).  These are selected by the division or office in charge of the topic involved, so that typical cases involving family law matters would be selected by the #1 Civil Division, while the Belt & Road typical cases would be selected by the #4 Civil Division.  Sometimes typical cases are issued jointly with a relevant ministry, such as those issued in 2021 concerning 996 labor cases, and would reflect the substantive and political concerns of that ministry.  Some of the cases selected may not have legal significance but are selected to harmonize with the leadership’s current policies.
  3. The Judicial Reform Office issues typical judicial reform “cases” after approval by the SPC’s judicial reform leading small group.  These typical cases are not “cases” in the sense of the substantive divisions of the SPC, but rather are focused on various types of judicial reform projects that the Judicial Reform Office considers are useful experiences replicable by lower courts around the country.
  4.  Selection of People’s Court Cases(人民法院案例选),  a quarterly publication of the China Institute of Applied Jurisprudence (discussed previously on this blog). These cases are published in paper version only, but lower courts subscribe to them widely.  These cases are considered more technical.
  5.  The National Judges College and the SPC’s Judicial Case Academy (located at the National Judges College) edit and issue 中国法院【】年度案例, divided into subject matter, edited by the Judicial Case Academy. These cases are considered more technical.
  6. The publications of each substantive division, all of which contain a selection of cases, are also considered typical, as discussed here, and considered by judges in when hearing cases.
  7. Additionally, as mentioned earlier,  typical cases can be found in the People’s Court Daily and People’s Justice (人民司法).  Presumably, the editors of those publications make the final selection, but likely work with the substantive divisions of the SPC when doing so.
  8. Several of the circuit courts issue a “case a week” and the SPCIPC does so as well.
  9. The SPCIPC issues case gists, also considered analogously to “typical cases” to intellectual property judges. Some SPC circuit courts do as well.

Although, as will be further discussed below,  “political correctness” is considered when selecting typical cases, some of the typical or major cases listed above are selected more for policy reasons, while others are considered by those in the inside as more technical.

How does a case in the local courts become an SPC typical case?

The roadmap from a case in the local courts to an SPC typical case can be gleaned from a detailed notice that the China Institute of Applied Jurisprudence (CIAJ) issued in the spring of 2021. The CIAJ issued the notice to courts at the provincial level (including the Xinjiang Construction & Production Corps  Higher People’s Court and the People’s Liberation Army Military Court), seeking contributions to its Selection of People’s Court Cases (人民法院案例选).  These principles apply similarly to SPC Gazette, typical or major cases that the SPC itself issues, although the format of the published case varies.

The higher people’s courts are in charge of reporting them to the SPC–principle three in the notice (the organization reports them 组织报送)—-although authors theoretically can submit directly. That means that local court judges must obtain internal approval to submit their cases level by level.

I surmise that the gatekeepers at the provincial level vary, depending on the area of law. It is likely that the Research Offices of the Higher People’s Courts are responsible for reviewing draft submissions and recommending ones to be submitted to the CIAJ, while the divisions in charge of cross-border commercial matters would compile cross-border commercial cases for submission to the #4 Civil Division.  It is likely to be a collective exercise at the provincial level, with a final sign-off from a person in a leadership position.

The notice also provides details on what the lower courts should report–the case, which should be published on the SPC case database. However, this does not appear always to be the case, as noted by Professor He Haibo of Tsinghua University (and coauthors) in their article on the transparency of court decisions. The case that the lower court submits is to be reported in a specific edited format (the website of the CIAJ has detailed guidance), with the original judgment or rulings attached. Most SPC  typical cases I have seen do not provide the case numbers for the related cases and in certain cases, the cases themselves are not public.  The recent third batch of Belt & Road typical cases is among the exceptions to the general practice.

As for the type of case analysis that is required:

  1. The case analysis provides guidance to judges and others in the legal profession because it supplements legislation, judicial interpretations or judicial policy documents.  To do so the case must be typical, novel, difficult,  and correct.  As to what that means:
      • Typical refers to the legal relationship, law applied, and the usefulness of the case as a reference for others.
      • Novel relates to legal issues arising after the promulgation of new laws and regulations, judicial interpretations or new policies, or although the issues or although the legal relationships are not new,  new circumstances or technology etc. have emerged, which means the case is novel.
      • Difficult often refers to the law being unclear or the case being controversial.
      • Correct means both legal and politically–the case and the analysis adhere to the concept of socialist rule of law with Chinese characteristics, embody socialist core values, and are consistent with Xi Jinping’s legal thought.   The political correctness requirement is not new–it is consistent with what I wrote about SPC Gazette cases in 1993.  Therefore the typical cases involving the Belt and Road will need to be consistent if not further intended to further China’s Belt and Road policies and other policies relating to cross-border dispute resolution.

2. Analytical style

As Hu Changming (previously mentioned on this blog) wrote earlier:

Case evaluation consists of the comment and analysis of the opinions, reasons, and results in the judgment document by the editor. It is not only a simple repetition of the reasons for the judgment, but more whys…. The evaluation and analysis should be discussed in depth in combination with relevant laws and regulations, and even the legal theory and legal spirit behind the law. A case analysis with a profound commentary is often a small paper with a clear and a strong argument.

3. Selection

A small group of judges or other staff at the SPC reviews the typical case submitted from the provincial high courts.  In smaller divisions, a judge and judge’s assistant are responsible for an initial review, while in larger divisions, a small group of judges and judge’s assistants do so.  But the persons who will be involved in the selection will depend on the SPC institution responsible for the selection.  According to the notice, the CIAJ involves prominent academics in the process, but the initial filtering is likely done by a team involving CIAJ post-docs (I surmise).  Those doing the initial review will select more cases than the targeted number. Generally, the professional judges meeting of the division involved will review the selection, with the deputy and head of the division reviewing the selected cases and determining the final selection to be made to SPC leadership. It is likely that a report accompanies the selection of the typical cases so that those in leadership understand the significance of each case.  Having a case selected by the SPC as a typical case is considered prestigious to the individual and the court involved. (For one of many examples, see this notice about a series published by the Shanghai Financial Court, noting that many of their cases had been selected as Gazette or other types of typical cases).

Concluding comments

Typical cases are one of many tools in the SPC guidance toolbox.  Its major use is to guide the lower courts, given dynamic Party policy and statutory law (and possibly judicial interpretations) that leave courts a great deal of discretion. The SPC uses typical cases to guide the lower courts timely to apply the law and judicial interpretations correctly in specific cases, harmonized with current policy, to better unify judgment (adjudication) standards.

Second, the SPC does so to fulfill its obligations under the popularization of law responsibility system to guide and educate the general public.  This, too, is not new, just repurposed for the New Era.

Third, the fact that some typical cases are selected to harmonize more closely with current policy rather than for their legal significance reflects the fact that the Chinese judiciary operates within a system in which political quality  (政治素质) takes the leading role in the assessment of judges, as exemplified in November 2021 SPC guidance.

___________________________________________

Many thanks to several knowledgeable persons for their comments related to typical cases, which will be further incorporated into a later blogpost. Special thanks to an anonymous peer reviewer for insightful and helpful comments on an earlier draft of this blogpost.

Remembering Tom Jones

Tom Jones and I, March 2021

Readers of this blog who either know me personally or have looked at About Me will know that I spent almost 12 years at the law firm Freshfields Bruckhaus Deringer, thanks to Tom Jones (Thomas Edwin Jones), then a partner in the Hong Kong office of what was then Freshfields, now Freshfields Bruckhaus Deringer (Freshfields). He was most recently a senior consultant with Fangda Partners, where he worked with several of our former colleagues, including Michael Han (韩亮) and Colin Law.   He passed away last week (on 17 March)  at the age of 72.  He had suffered from Amyotrophic lateral sclerosis (ALS).  Among the most frequent comments from former colleagues in our Freshfields “old cadre (老干部)” Wechat group that “he was a good man” and “the best mentor.”  Our many former colleagues are partners in other law firms or in-house counsel with major companies, while some who have left the law altogether and several of us are (or were) in academia. 

I was privileged to be part of his multinational team of “China lawyers,” spread out among the Freshfields offices in Hong Kong, Beijing, Shanghai, sometimes London, and often one or more cities in Germany.  Those of us from “the West” often had had a previous career before joining the team, and our mainland Chinese colleagues in the Beijing and Shanghai offices were always graduates from top law schools, with at least one 高考学霸 (top scorer in the gaokao).  Because Freshfields is a  Magic Circle firm, we regularly hosted guest lawyers from the  Lord Chancellor’s Scheme for Chinese Lawyers, several of whom later joined the firm.

When I decided to leave City University of Hong Kong in 1994, he was one of the very few law firm partners with whom I interviewed who recognized that my academic background could be an asset to the firm.  He fostered a sense of collegiality and team spirit that I subsequently discovered was a rare phenomenon.   He brought people together even after he left this world.

May his memory be for a blessing.

 

Supreme People’s Court’s 2022 Pre-“Two Sessions” Accomplishments

In the period between 1 January and today (2 March 2022), the Supreme People’s Court (SPC) issued quite a few judicial interpretations, judicial documents, and typical cases.  This blogpost focuses on one judicial interpretation; several Greater Bay-related interpretations and documents; and several sets of typical cases issued since the beginning of the year.   Apologies to readers that I do not have time to analyze any of this properly-I am doing the first of many major revisions of an academic article,  for submission.

Judicial interpretations: General Part of the Civil Code

In late February, the SPC issued the Interpretation of the General Part of the Civil Code (最高人民法院关于适用《中华人民共和国民法典》总则编若干问题的解释).  I had previously surmised that it would be finalized before the National People’s Congress (NPC) meeting in March.  It went into effect on 1 March 2022.  An SPC press release is found here, with background information on drafting, mentioning that the drafters had completely accepted the views of the Legislative Work Commission (LAC) in the drafting process, for reasons previously discussed.  I surmise in the meeting rooms in which the draft interpretation was discussed, there was a robust exchange of views. A more recent article, published after this blogpost was originally written), that I recommend to those with an interest (Understanding and Application of the General Part), has more detailed information about the drafting.

As discussed earlier, the drafters solicited views within the court system and among some of the leading Beijing law schools.  The press release highlighted the importance of integrating socialist core values into the interpretation. Commentary by a responsible person of the Research Office of the SPC here. That office led the drafting of the General Part, as flagged in this blogpost. The authoritative person (perhaps Judge Guo Feng, but unknown), mentions the integration of socialist core values into the General Part of the Civil Code, as is required by the ongoing SPC plan and a multi-institutional Party document that has not been made public. The “Understanding and Application of the General Part) was written by Judge Guo Feng, Chen Longye (mentioned here), and Liu Ting, a judge’s assistant, whom I surmise was seconded to the Research Office from the Nantong (Jiangsu) Intermediate People’s Court. Therefore I assume that the authoritative person quoted in the earlier press release was in fact Judge Guo.

The article by Judge Guo and colleagues details the many entities that saw the draft of the  interpretation: relevant entities within the SPC; all the higher people’s court; as well as the Central Publicity Department (中宣部), Central Political-Legal Commission (中政委),the office of the Central Governing the Country According to Law Commission (中央依法治国办), the Supreme People’s Procuratorate (最高人民检察院), Ministry of Public Security (公安部)、Ministry of Justice (民政部)、State Administration of Market Regulation (市场监管总局),  China Law Society (中国法学会), China Academy of Social Sciences (presumably the Law Institute), the All-China Federation of Industry and Commerce, and others. They twice sought comments from the LAC in writing(两次书面征求全国人大常委会法工委的意见)–this means through formal institution to institution communications.

As I wrote in an earlier blogpost, it appears that the SPC is both “serving the greater situation” by implementing in the courts the Party’s plan to integrate socialist core values in plans to legislate and amend legislation(社会主义核心价值观融入法治建设立法修法规划) [the new plan, entitled  关于建立社会主义核心价值观入法入规协调机制的意见(试行)] while at the same time seeking to deal with many of the difficult legal issues that face it.

The General Part covers the following issues: capacity for civil rights and capacity for civil conduct, guardianship, declaration of disappearance and declaration of death, civil legal acts, agency, civil liability, statute of limitations, and supplementary provisions. Professor Wang Liming’s highly authoritative commentary, posted on an SPC Wechat account, is found here.   Professor Yang Lixin has also published an authoritative article. I recommend this version, with red highlighting by now-former SPC judge Xiao Feng of the important points of Professor Wang, Yang, and Shen Weixing, dean of Tsinghua University Law School and Professor Yu Fei of China University of Political Science and Law.

Greater Bay Area Judicial Assistance and Judicial Policy

The SPC issued several Greater Bay related documents since 1 January, listed below, which relate to SPC policy on developing civil judicial assistance with the Hong Kong and Macau Special Administrative Regions:

1.Mutual Assistance Arrangement between the SPC & the Macau SAR in Arbitration Procedures (最高人民法院关于内地与澳门特别行政区就仲裁程序相互协助保全的安排);

Important background found in the press conference, in which Judge Si Yanli and others involved in negotiating the Arrangement spoke. My earlier blogpost explains why Arrangements are approved as judicial interpretations, although they do not fit the formal jurisdiction of one: “Judge Si mentioned that for the Supplementary Arrangement to be effectively implemented on the mainland, it must be transformed into a judicial interpretation.” Those following legal developments in the two SARs should note the following language in the press conference: “the Outline of the Greater Bay Area and the Hengqin Plan both propose to promote the convergence of rules and coordination of mechanisms in the Greater Bay Area of Guangdong, Hong Kong, and Macao. Inter-regional judicial assistance is an important way to reflect Chinese characteristics, highlight the advantages of “two systems” and achieve convergence of legal rules and mechanisms.  《大湾区纲要》《横琴方案》均提出要推进粤港澳大湾区规则衔接、机制对接。区际司法协助是体现中国特色、彰显“两制”优势,实现法律规则衔接、机制对接的重要途径”。This theme is further developed in two January, 2022 policy documents linked below.

2. Arrangement on Reciprocal Recognition and Enforcement of Civil Judgments in Matrimonial and Family Cases by the Courts of the Mainland and of the Hong Kong Special Administrative Region 最高人民法院关于内地与香港特别行政区法院相互认可和执行婚姻家庭民事案件判决的安排. The SPC and Hong Kong Department of Justice held a useful seminar to explain its provisions, at which Judge Si Yanli spoke, among others.  I expect that the law firms focusing on family law matters will follow up with detailed client alerts.

3. Opinions on Supporting and Guaranteeing the Comprehensive Deepening of the Reform and Opening-up of Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone 关于支持和保障全面深化前海深港现代服务业合作区改革开放的意见, linked to the Central Committee and State Council’s September, 2021 document on Qianhai/Hong Kong and Opinions on Supporting and Guaranteeing the Construction of Hengqin Guangdong-Macao Deep Cooperation Zone 关于支持和保障横琴粤澳深度合作区建设的意见, linked to the Central Committee & State Council’s September document on Hengqin/Macau.  It is unclear to me whether the SPC solicited the views of the two SARs on these documents. As mentioned above, it mentions national policy to achieve convergence of legal rules and mechanisms in the Greater Bay Area and mentions several aspects of that policy that is relevant to dispute resolution.   Among those are (numbers are from the points in the relevant Opinion):

4. Expanding the jurisdiction of the Qianhai court, including permitting it to take cases when the parties have agreed on the jurisdiction of the Qianhai, but there is no connection to the dispute. This appears to be another piloting (the SPC’s Lingang Opinion has a similar provision) of a possible future amendment of the Civil Procedure Law to abolish the closest connection rule for cross-border jurisdiction (see Professor Vivienne Bath’s research on this issue);

5. Work on (加强) establish an inter-regional judicial assistance system with Chinese characteristics, consider an electronic platform for civil and commercial judicial assistance in the Guangdong-Hong Kong-Macao Greater Bay Area;

8. Explore the establishment of a unified qualification recognition system for Hong Kong and Macao mediators to practice in the Guangdong-Hong Kong-Macao Greater Bay Area.  The lawyer qualification system requires that the lawyer be a Chinese citizen, consistent with Chinese legislation. Query whether the same requirement will be imposed on mediators. This would be disadvantageous for Hong Kong mediators who are not Chinese citizens.  

I highly recommend Judge Si Yanli’s recent academic article on Greater Bay judicial assistance issues for those with an interest in this topic.

It is my hope that someone can undertake further analysis of these documents.

SPC Typical Cases

Perhaps because General Secretary Xi Jinping has said “one case is better than a dozen documents (习近平总书记强调, “一个案例胜过一打文件”),  in the run-up to the “Two Meetings,” the SPC has issued quite a few typical cases. Typical cases are intended to guide the courts and the general public.

  1. Nine typical cases on protecting the rights of juveniles 未成年人权益司法保护典型案例, well worth further analysis, with several involving family education orders to parents and one involving failure of a hotel to verify the identity and contact information of a juvenile couple that checked into a hotel room (where they had sex);
  2. Ten typical cases on solid waste pollution人民法院依法审理固体废物污染环境典型案例, seven criminal cases, two civil cases, and one administrative case. Three involve public interest litigation, two by the procuratorate and one by a civil society organization;
  3. The third set of Belt & Road-related cases 最高法发布第三批涉“一带一路”建设典型案例.  The cases are not necessarily specifically connected with the Belt & Road but involve Chinese cross-border commercial, maritime, and arbitration issues.  One China International Commercial Court (CICC) case is included, a case on an infrastructure payment guarantee, as is the Brentwood case.   The SPC’s comments on the CICC case are consistent with my comments published earlier on this blog about the role of CICC in providing soft precedents for the Chinese courts: “the principle of attribution has an exemplary guiding role for the resolution of similar disputes in the future (该归责原则对今后类似纠纷案件的解决具有示范指导作用).”
  4. Accompanying the release of the General Part judicial interpretation was the first set of  Civil Code typical cases The typical cases are not limited to illustrating the General Part but relate to different parts of the Civil Code, also stressing socialist core values.
  5. A first set of typical cases of the courts providing services and safeguards to the free trade zones 人民法院服务保障自由贸易试验区建设典型案例.  The cases are intended to guide the lower courts and general public, and  as the introduction states illustrate the “achievements of the people’s courts in actively creating a business environment that is ruled by law, internationalized, and convenient.”  For those interested, see my earlier article on the SPC and free trade zones, available on
  6. SSRN
  7. The second batch of cases in which the people’s courts promote socialist core values 第二批人民法院大力弘扬社会主义核心价值观典型民事案例.  These cases are worth further analysis for what they show about the treatment of the elderly, among other social issues.

Guidance on the Special Handling of Four Types of Cases & Its Implications

Four Types of Cases

By Susan Finder and Straton Papagianneas

In early November 2021, the Supreme People’s Court (SPC) issued a new Guiding Opinion regarding Further Improving the Trial Supervision and Management Mechanism for the Four Types of Cases (关于进一步完善“四类案件”监督管理工作机制的指导意见translation here) (“Four Types of Cases Guiding Opinion” or “Guiding Opinion”).  Official commentary by the drafters is found here.  The “Four Types of Cases” refer to certain types of cases, all politically or socially sensitive, that require special handling within the court system and involvement by the relevant court leadership. The term “Four Types of Cases” originates with the 2015 SPC document “Several Opinions on Improving the Judicial Responsibility System of the People’s Courts,”  (2015 Opinion) although special treatment within the Chinese court system for special types of cases is not new, as I described in my (the Monitor’s) 1993 article.  This Guiding Opinion illustrates themes newly stressed in General Secretary Xi Jinping’s 15 February 2022 article on the socialist rule of law.  

While the “Four Types of Cases” are a little-known concept outside of China, they are well known within the Chinese court system and are embedded in other court guidance.  The Four Types of Cases Guiding Opinion draws together threads of related policy to provide standardized principles on:

  1. Redefined  “Four Types of Cases;”
  2. Mechanisms for flagging cases as one of the “Four Types of Cases” at each stage of the court process;
  3. Mechanisms for special treatment of these cases; and
  4. A range of mechanisms for involving more senior judges in the handling of these cases while monitoring their involvement.

The Four Types of Cases Guiding Opinion provides insights into the operation of the Chinese judicial system, particularly after the 19th Party Congress and the ongoing transformation of the judicial system and legal system.

This blogpost gives a summary of the background to this Guiding Opinions before examing its details and providing some comments linking to larger themes.

1. Origin of the “Four Types” of Cases

a. The 2015 Opinion

The 2015 Opinion implements the broad principles in the 4th Plenum of the 18th Party Congress decision and 4th Judicial Reform Plan Outline by setting out guidelines for greater autonomy and greater responsibility for judges, known as the “judicial responsibility system.” It contrasts to the pre 4th five-year judicial reform plan period when all court decisions needed to be approved by a person (or committee) in a leadership role in a court.  It also requires the preferential use of a random allocation of cases system,  while pre-reform, court leaders at various levels designated judges hearing cases.

At the same time, the 2015 Opinion also imposed more responsibility or accountability on frontline judges, while reducing (or eliminating) the involvement of court leaders not involved in the hearing. It gives court leaders (a court president, vice president, and division head) supervisory and management authority. Other guidance prohibits court leaders from involving themselves in cases handled by other judges, with certain exceptions. An exception was made for “major, difficult, and complicated cases” when court leaders could designate collegiate panels to conduct hearings (Article 7). These cases are called the “Four Types of Cases” (四类案件).  They refer to the following cases:

  1. Group disputes that may affect social stability;
  2. Ones that are difficult, complex, and have a significant impact on society;
  3. They might conflict with the judgment of the court or a higher-level court; and
  4. Relevant units or individuals report that the judge has violated the law  (Article 24).

The 2015 Opinion did not provide any further details about these Four Types. Lower courts issued guidance detailing the meaning and scope of these cases, while the SPC incorporated measures relating to “Four Types of Cases” in documents relating to the judicial responsibility system listed below.

b.  Subsequent documents 

 Pre and particularly post 19th Party Congress, the SPC issued a number of documents related to the judicial responsibility system and the special responsibility of court leaders.  At the same time, Party authorities issued documents imposing greater responsibility on Party members in leadership positions.  Many of these are collected in a 2021 book edited by the office of the SPC leading small group on the judicial responsibility system and the SPC Political Department. These documents include:

  1.  April, 2017 Opinions on Implementing the Judicial Responsibility System and Improving the Trial Supervision & Management Mechanism (for Trial Implementation);
  2. July, 2017 Opinions of the Supreme People’s Court on the Implementation of the Judicial Accountability System (for Trial Implementation (最高人民法院司法责任制实施意见(试行)), the subject of this blogpost; 
  3. December, 2018 SPC Opinions on the Further and Full Implementation of Judicial Responsibility Systems.  
  4. January, 2019, Regulations of the Communist Party of China on Political-Legal Work (with a section on the Party Group of political-legal institutions);
  5. February, 2019  Fifth Five-Year Judicial Reform Plan (5th Judicial Reform Plan): it emphasizes the full implementation of the judicial responsibility system. That system in turn is linked to broader Party initiatives to expand the responsibility of leading  Party and government cadres as well as court leaders to cooperate better with Party inspections of various types.
  6. March, 2020 Opinions on Deepening the Comprehensive Reform Supporting the Judicial Accountability System issued by the General Office of the CPC Central Committee (关于深化司法责任制综合配套改革的意见 full text not available);
  7. 2020 SPC  Opinions on Deepening the Comprehensive Reform Supporting the Judicial Accountability System. This document sets out the principles to be incorporated in the Four Types of Cases Guiding Opinions.
  8. January, 2021 Guiding Opinion on Improving the Work System of Professional Judges Meetings, which supersedes 2018 guidance, Guiding Opinions on Improving the Working Mechanism for Presiding Judges’ Meetings of People’s Court (For Trial Implementation). See my 2021 blogpost.
  9. It also links to the political-legal education rectification campaign. 

2. New 2021 Guiding Opinion

Four Types of Cases cases are deemed too complex, sensitive, or important to be handled by a frontline judge or panel of judges alone.  The new Four Types of Cases Guiding Opinion embeds multiple levels and a range of guidance and supervision as well as penalty provisions for court personnel. The guidance and supervision are aimed at personnel at various levels and roles within a court.  It is intended as a practical set of basic principles that consolidates and develops measures that appeared in the guidance listed above. It anticipates local courts issuing more detailed rules to implement it.  A 2022 media report by the Shanghai Higher People’s Court on its judicial reform program for 2022 highlights the issuing of detailed rules on the Four Types of Cases as a priority matter.  A summary of the definition and scope; identification mechanism, handling and supervision; and liability provisions follows.

Definition and scope

The 2021 Guiding Opinion redefines the Four Types of Cases and their scope, sets out the responsibilities of various persons within a court at different stages of a case, both front line and in a leadership role (court president and division chiefs) According to Article 14, those in a leadership role include the court president, vice presidents, full-time members of the judicial committee, division heads and deputy heads, and others in a supervision and management role. The guidance promotes using a multi-stage mechanism for identifying these cases and flagging them for special handling. Article 2 to 6 go into detail concerning the meaning and scope of “Four Types of Cases”, with changes from the 2015 Opinion. The new “Four Types of Cases” encompass the following types of cases:

  1. They are major, difficult, complex, or sensitive;

  2. They involve mass disputes or cause widespread societal concern, which might affect social stability;

  3. They might conflict with the judgments and rulings of the court or a higher level people’s court in similar cases;

  4.  Relevant units or individuals reported that a judge has violated the law in the trial.

The comments below address points 1-3. The first type significantly expands the scope from the original “group disputes that may affect social stability”. The drafters explain this change: “the difficulty and complexity of cases are not necessarily proportional to their social impact”. For example, a divorce case can be complicated and sensitive, yet their impact on regional or national society might be minimal.  “Major, difficult, complex, or sensitive” could cover a case in any area of law, in theory. 

The second type also changes the definition in the 2015 Opinion significantly, now referring to cases that involve large groups, or cases that cause widespread social concern. Most importantly is that these cases may affect social stability. For example, some types of cases may involve a large number of litigants, such as traffic accidents, but carry little risk of causing further mass incidents or intensifying social conflicts. These cases should not be considered one of the Four Types of Cases.

However, cases that may trigger mass incidents (e.g., labor protests after failure of litigation), risk intensifying social conflicts, or the case may have a “demonstration”, i.e., precedent-setting, effect (e.g., land-taking compensation cases), and may trigger more litigation. This may impact the development of specific industries, or the interest of specific groups, and are all cases that do need careful supervision and management.

Additionally, the SPC is of the view that cases that cause widespread concern and may affect social stability are not limited to group disputes. For example, murder cases are known to stir up public outcries. Additionally, cases involving rape claims have recently also garnered a lot of public attention. 

For the third type, the Opinion broadened the scope. First, it changed the wording from “judgment” (判决) to “decision” (裁判). This can be translated as “judgment and rulings.” Second, in addition to a  final judgment by a court, it includes other rulings or decisions regarding inadmissibility, objections, suspension or termination of litigation. This suits the more comprehensive process-based type of supervision that is intended and is further discussed below.   The conflict with current or prior judgments and rulings is specified to be with decisions of that court or higher courts within the past three years, or are currently being heard, and where it is necessary to unify the application of law.

While the Opinion further details the meaning and scope of the Four Types, the drafters explain that they insist on maintaining a healthy balance between broadness and specificity, so as to allow local courts leeway in determining how to identify a case as one of the Four Types. This recognizes that courts in different regions have different considerations, and that, based on local conditions, different kinds of specific cases require supervision and management.

Article 7 contains additional measures to widen the scope of “Four Types of Cases.” It provides that the oversight and management measures for Four Types of Cases can be applied to other types of cases: effective decisions that are in error and require retrial; cases in which the procuratorate has filed a protest; whether a death sentence (including suspended ones) is intended to be imposed; the amount in dispute is very large; or where a court plans to pronounce a defendant not guilty. This Article is consistent with recent policy to expand the scope of supervision of the exercise of judicial power, most recently emphasized in Xi’s February, 2022 article.

Identification Mechanism, Handling. and Supervision

Article 8 requires local courts to establish mechanisms to cover the entire court process to identify, label, and give a warning concerning Four Types of Cases. This article additionally requires local courts to set rules on the responsibility of internal entities to flag cases and report them, as well as responsibility for the failure to do so. The rest of the article sketches the SPC’s concept of how the Four Types of Cases are to be flagged through the entire court process and who decides any dispute over classification. 

Article 9 and 10 address  the adjustments and measures that senior court members may make regarding the case, depending upon when the case is flagged as one of “Four Types of Cases.” Regardless of whether a case is designated at the filing stage or not until it has been transferred to a case hearing division, the Opinion requires the case must be heard by a collegial panel rather than a single judge, and a member of the court leadership could serve the presiding judge.  The recent Civil Procedure Law reforms mentioned in this earlier blogpost expand the scope of cases that a single judge can hear, but this Guiding Opinion makes clear that a collegial panel must take on responsibility for hearing one of “Four Types of Cases.” These provisions links to previous SPC guidance to senior court leaders on the role they need to fulfill since the judicial reforms. The court leadership can also change the presiding judge and the size and composition of the panel. 

Article 10 lists the oversight and management measures that court leaders may take within their authority, such as: requesting reports on the progress of the case, reviewing the case files and trial report, attending trial hearings, submitting the case to a professional judges meeting, to the judicial committee, or even reporting to the court at one level above for guidance.  The measures taken are likely to depend on how sensitive, difficult, or otherwise troublesome the case is.  I surmise that this system will lead to more such cases discussed by a professional judges meeting or judicial (adjudication) committee meeting so that the decision is made on a collective basis.

Article 10  importantly clarifies the exact measures that constitute permissible supervision and management under the new responsibility system. These measures need to be incorporated into the list of powers and responsibilities based on the court member’s position.  All actions and measures need to be in accordance with local procedures and within the scope of authority of the judge exercising supervisory authority. The Opinion specifies that any action that falls within this scope does not constitute undue interference in cases and does not violate provisions about internal interference with judicial processes.

In contrast to previous practice, in which court leader guidance in these types of cases was not generally recorded, Article 11 requires that court leader oversight and management of “Four Types of Cases ” must be recorded in the case file and on the case-handling platform. Note that the recording would not be accessible to lawyers reviewing a court file. The views of court leadership about the case must be announced at a professional judges meeting or judicial committee meeting,  Court leaders can request that a collegial panel reconsider their proposed decision, but cannot directly change the panel’s decision without going through permitted procedures.  These measures seem to be aimed at preventing improper practices that enable corruption.  Those improper practices must have regularly occurred in the handling of “Four Types of Cases.” Article 14 specifies that supervision and administration of “Four Types of Cases” are considered part of the scope of a court leader’s work and therefore will be incorporated into the person’s performance evaluation.

Article 12 contains penalty provisions for both the frontline judges handling the case and the court leadership. Acts that can trigger liability for frontline judges include concealing that a case is a “Four Types of Case” case, failure to obey supervision and management, or causing a serious error in a decision through that conduct with serious consequences.

Court leaders who neglect or improperly perform their oversight and management of a “Four Type of Case” case intentionally or through gross negligence causing errors in decisions and serious consequences bear liability with reference to the provisions and procedures for the management of cadres. 

Article 13 addresses using the smart courts mechanism to identify “Four Types of Cases,” remind front-line judges to report the case, and prompt court leaders to supervise and manage the cases.

Concluding comments

In one short document, the Guiding Opinion on the Four Types of Cases captures many themes in internal court administration regulation and in the operation of the Chinese judicial system after the 19th Party Congress as well as the ongoing transformation of the judicial system and legal system.

The Guiding Opinion seeks to protect front-line judges from deciding “Four Types of Cases” autonomously in a way that is considered wrong or inconsistent with policy and legal provisions (non-unified).  Consistency of judicial decision-making is a high priority of the SPC recently, consistent with Xi’s article mentioned above: “maintaining the unity of the country’s rule of law is a serious political issue 维护国家法治统一是严肃的政治问题. ” This links to the role of court leaders as well.

The Guiding Opinion consolidates guidance for court leaders, who under the Chinese bureaucratic court system, have special responsibilities under the SPC guidance listed above, as well as more general Party regulations applicable to “#1” leaders, and Party group members in the Zhengfa 政法 (political-legal) system.  It imposes greater pressure on court leaders to hear cases, as required by earlier guidance.  As discussed earlier, judges in a leadership position spend substantial time on administrative, coordination, and Party matters rather than hearing cases.  Guiding the proper handling of one of the Four Types of Cases is also a way for a court leader to display leadership qualities while mishandling it will trigger criticism in an internal judicial or Party inspection (see my chapter on judicial discipline for a discussion of the principal types of inspections.) On incorporating work on “Four Types of Cases” into leaders’ performance evaluation, although the Chinese court slogan (of several years ago) is that judges should be treated more like judges, the Guiding Opinion appears to treat lower court judges analogously to secondary or university students, to be given grades for their class participation. 

The Opinion embeds supervision of the activity of court leaders, particularly by the use of the digital(smart courts) case-handling platform. By now, the majority of Chinese courts have a fully online and digital case-handling platform, many of which automatically record these types of supervisory and managerial measures. However, it is unclear how this has changed judicial practice regarding sensitive cases, and whether new informal practices to circumvent this digital system have emerged. 

This Guiding Opinion is an important document in understanding the Party leadership’s and the SPC’s vision of the Chinese courts in the New Era. It illustrates themes in what Xi calls in the February, 2022 article “comprehensively deepening reforms in the area of rule of law 全面深化法治领域改革,” therefore a vision of reshaping Chinese law and legal institutions generally. It links to the Party leadership’s vision of whole process supervision (全过程监督), mentioned in Xi’s most recent article, which to this observer has its roots in traditional Chinese concepts of supervision of the bureaucracy.  It uses its cutting-edge smart court system towards this end. That would be consistent with themes mentioned recently in an earlier blogpost, that Chinese characteristics have a great deal of weight in the reshaping of the Chinese legal system.  It is also consistent with an important statement in Xi Jinping’s February, 2022 article: “the socialist rule of law system with Chinese characteristics that we want to build must be a rule of law system that is rooted in Chinese culture, based on Chinese conditions and solving Chinese problems, and cannot be misled by Western misconceptions (我们要建设的中国特色社会主义法治体系,必须是扎根中国文化、立足中国国情、解决中国问题的法治体系,不能被西方错误思潮所误导).”  

The definition and scope of the “Four Types of Cases” are flexible, so as to accommodate a system in which judges bear lifetime responsibility for their decisions and court leadership bears responsibility for the decisions of their judges, and multiple types of inspections, both Party and court, monitor implementation of campaigns (such as those for the Sao Hei campaign), as well as more general policies.  The accountability (responsibility or liability) provisions are broad and linked with the Party’s system for cadres, rather than professional rules.  That too is consistent with traditional Chinese law.

The vision of the approach to handling”Four Types of Cases” in the Opinion is holistic, in line with the principles mentioned in the 2021 Opinion on integrating socialist core values into judgment instruments— the organic unity of political, legal, and social effectiveness (政治效果、法律效果和社会效果有机统一 ), because through this process, a judicial decision that best meets that target is likely to be achieved.  And this has implications for litigants.

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Many thanks to Straton Papagianneas for translating the “Four Types of Cases Guiding Opinion” and drafting an initial version of this blogpost (and responding to several rounds of comments). Many thanks also to an anonymous peer reviewer for perceptive comments on a later draft of this blogpost.

 

 

 

 

 

Supreme People’s Court Issues New Guidance on Cross-Border Commercial & Procedural Legal Issues

In January 2022, the Supreme People’s Court (SPC) issued a Conference Summary [also translated as “Meeting Minutes”] of the National Symposium on Foreign-Related Commercial and Maritime Trial Work (Foreign-Related Commercial  & Maritime Law Conference Summary (全国涉外商事海事审判工作座谈会会议纪要).  From unauthorized versions released, it can be seen that it was another SPC year-end accomplishment.  Although this document is not a judicial interpretation and cannot be cited in Chinese court judgments, it is crucially important for legal professionals outside of China dealing with cross-border commercial issues involving China and for Chinese legal professionals focusing on cross-border commercial issues involving the rest of the world.

The conference summary has  111 provisions.  The focus is on legal issues because the target audience of domestic judges understands the political framing.  The conference summary applies to foreign-related cases and to Hong Kong, Macau, and Taiwan-related cases by reference (see Article 111,  set out at the end of this post).  They are in the following categories:

  • foreign-related commercial (涉外商事部分), the longest:
  • Maritime (海事部分); 
  • Judicial review of arbitration (仲裁司法审查部分).

This blogpost will explain why the conference summary was issued, its legal and policy basis, and why it addressed those particular issues and will leave the majority of the content of the conference summary for the experts in practice and academia.

Why this conference summary?

The conference summary (meeting minutes) is based on a national conference on foreign-related commercial and maritime trial work held in Nanjing in June of last year and the issues that the SPC would have heard raised by lower court judges.

When asked the question of why this conference summary was issued, an SPC judge is likely to say “to resolve difficult issues in practice and unify judgment standards.” But a fuller answer to this question for a larger audience requires further details. 

As to why a conference summary and not rely on “case law” with Chinese characteristics, including China International Commercial Court cases, SPC cases, and various types of typical or SPC selected cases as “soft precedents,” the answer is that the SPC is issuing this conference summary to guide lower court judges (and possibly judges in other divisions of the SPC) practically and efficiently and for some additional reasons.  The simple answer is that “case law” is not effective enough to practically guide lower court judges.  If it were, the SPC would not have issued this document. I have seen a number of academic articles (in English) that illustrate a misunderstanding of what the SPC is doing.   

Additionally, I surmise that at the Nanjing conference, behind closed doors, SPC judges heard about inconsistent approaches or requirements from lower court judges.  I surmise they also heard from lower court judges uncertainty in the approach that they should take concerning issues where the law is unclear.   The judicial evaluation system values deciding cases correctly. Moreover, the most recent SPC policy focuses on unifying the application of law. Its leadership has established a leading small group to that end.  So for all these reasons, lower court judges would look to the SPC for clarification.   What is contained in the conference summary is the SPC’s current consensus on major cross-border commercial, maritime, and arbitration review-related issues, based on their further research and consideration.

In the busiest courts where many of these cases arise, judges are under enormous pressure to decide cases timely and accurately, especially after the recent changes to the jurisdiction of lower courts under the reorientation of the four levels of the people’s courts and the issuance of other documents changing the jurisdiction of the lower courts in commercial cases.  “Codifying” the principles from cases and issues considered by the SPC in the form of a conference summary is the most useful and efficient form of guidance for lower court judges. As mentioned here, although conference summaries are not judicial interpretations and cannot be cited in a court judgment document as the basis of a judgment, they provide important guidance to the work of the courts concerning issues about which existing law and judicial interpretations are unclear.  Judges will rely on its provisions to decide cases.

The legal basis for the conference summary derives from the SPC’s authority under Article 10 of the Organic Law of the People’s Courts to supervise the lower courts. 

As for an answer to the question of why not issue a judicial interpretation–time, fluidity, and attenuated basis for some of the conference summary’s provisions do not permit a judicial interpretation to be issued.  One example of the attenuated basis and fluidity is Article 100,  which”codifies” the Guangzhou Intermediate People’s Court decision in the Brentwood case (discussed here).   It establishes welcome certainty to the enforceability of arbitral awards made by overseas arbitration institutions arbitrations seated in Mainland China.  It provides that such awards are regarded as foreign-related arbitral awards (rather than foreign awards) in Mainland China.  It is likely to be helpful to the overseas arbitration institutions that are considering establishing case management offices in China, as is now possible under Shanghai and Beijing regulations.   As mentioned before, the Arbitration Law being revised, the current draft addresses the issue, and the SPC is likely to issue a comprehensive judicial interpretation thereafter.  

Moreover, for some of the procedural provisions, such as those relating to the recognition and enforcement of foreign judgments, it gives the SPC a chance to pilot its guidance, before formalizing it in the form of a judicial interpretation.   A recent Wechat article (with further details) flags that in 2021, three foreign judgments and nine Hong Kong, Macau, and Taiwan judgments were recognized and enforced.  Likely more applications were made but not decided.

Other provisions consolidate existing guidance in a form that is easier for the lower courts to grasp quickly.  Article 22, on obtaining an opinion on foreign or international law from a China International Commercial Court (CICC) expert committee expert, for example, repeats what is to be found in CICC guidance.  The same can be said about Article 11, on the topic of electronic service of process, promoted in several Belt & Road-related SPC Opinions.  It should be noted that China maintains its traditional approach to service of process from foreign jurisdictions.

It appears that some clauses reflect a change in the negotiating position of Chinese financial institutions, in contrast to “back in the day. ” Article 2, on the topic of asymmetric jurisdiction clauses, states that Chinese courts will uphold them unless they violate Chinese rules on exclusive jurisdiction or relate to the interests of consumers or workers.   (For those with no background on these clauses, according to Herbert Smith Freehills: “asymmetric jurisdiction clauses are common in the financial sector, and typically require one party to bring proceedings in one jurisdiction only, while the other (usually the financial institution) may choose to bring proceedings in other jurisdictions.”  From this position, I surmise that Chinese banks use asymmetric jurisdiction clauses as well.

Articles 18-20 address a few of the ongoing issues related to the application of international conventions and treaties in the Chinese courts. Article 18 answers the question of what a court should do if the relevant treaty or convention is silent or China has made a reservation on that issue.  The answer is to use the Law on the Laws Applicable to Foreign-Related Civil Relations to determine the applicable law.  Article 20 focuses on what a Chinese court should do if it is applying Chinese law if Chinese law has conflicting positions and China has acceded to a relevant treaty or convention.  A report on a recent workshop involving the SPC, the Beijing #4 Intermediate People’s Court, and academics from the China Academy of Social Sciences and other institutions flags some of the many other unresolved issues.

Article 30 addresses an important question for Chinese and foreign banks, suppliers to Chinese EPC contractors, and project owners, particularly in Belt & Road jurisdictions–how easily can a Chinese court stop payment on a demand (independent) guarantee?  The answer is, strictly according to the provisions of the relevant judicial interpretation. Article 30 provides that when a court hears an application to stop payment on the basis of fraud (which can be filed as a preliminary matter or during the course of litigation or arbitration),  it must examine the independent letter of guarantee stop payment application submitted by the parties in according to Article 14 of the (updated) Provisions on Several Issues Concerning the Hearing of Independent Letter of Guarantee Dispute Cases, and conduct a preliminary substantive examination on whether there are fraudulent grounds for stop payment in accordance with the provisions of Article 12 and set out its finding of facts and reasoning as required by  Article 16.

The Bigger Picture

This conference summary is another form of SPC soft law. It harmonizes the decisions of the Chinese courts to be consistent with SPC policy (or said another way, strengthens the firm guiding hand of the SPC). 

This document reflects the awareness of its drafters, the judges of the #4 Civil Division of the SPC, that the issues that come before the Chinese courts far outpace the infrastructure of Chinese foreign-related commercial law. Given the larger trends I described in my brief article last fall, we can expect the SPC to continue to play an important role in developing China’s body of law related to cross-border commercial matters.

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111.【涉港澳台案件参照适用本纪要】涉及香港特别行政区、澳门特别行政区和台湾地区的商事海事纠纷案件,相关司法解释未作规定的,参照本纪要关于涉外商事海事纠纷案件的规定处理)。111. [The application by reference of this conference summary to cases involving Hong Kong, Macao and Taiwan]. As for commercial and maritime cases involving the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan, which are not otherwise stipulated in relevant judicial interpretations, shall be handled with reference to the provisions of this conference summary on foreign-related commercial and maritime cases.

Dean Jiang Huiling on Chinese Judicial Reform

On 7 January 2022, Dean of Tongji University’s School of Law and Professor Jiang Huiling gave a guest lecture in my School of Transnational Law class.  We were honored to hear Dean Jiang provide his unique perspective and insights on over 20 years of Chinese judicial reform and his insights on future developments. He has been involved with Chinese judicial reform starting from the first plan in 1999 (see also more about his background here).  This blogpost summarizes his presentation. I have inserted my occasional comments in italics. If a point is not more fully elaborated, it means he did not do so.

He spoke on the following six topics:

1. Brief History of Chinese Judicial Reform
2. How Judicial Reform Actions  Are Taken
3. From the 4th to the 5th Judicial Reform Plan
4. Strategic Move: From Judicial Reform to “Zhengfa” (政法) Reform
5. Technical Measures: Rule of Law
6. Future Direction

1. Brief History

Dean Jiang went briskly through the history of judicial reform, commenting that in the first judicial reform plan, the focus was on raising public and professional awareness about the judiciary。 The second one, in which the Central Government greatly supported the SPC to undertake work mechanism (工作机制) reforms, not touching on structural reforms such as the status of judicial personnel. He noted that there was great progress during the second judicial reform plan. He called the third judicial reform plan a test before the New Era, and said that a decision had been taken to de-localize the judiciary and change the status of the judges and prosecutors, but at the end, there wasn’t internal confidence that the legal profession and society would accept such changes.  He called the fourth judicial reform plan a structural, systematic, and radical change to the judicial system, especially the decision that judges would not be treated as ordinary civil servants.  Dean Jiang characterized the fifth judicial reform plan as comprehensive and supplementary, and part of the Zhengfa reforms (as he further explained in the latter part of his presentation).

What were the lessons learned?

  • Right (科学) concept of the judicial system (universal and with Chinese characteristics)–that the legal profession and the leading party accepted the value of the rule of law and the importance of the judiciary;
  • Theoretical preparation–although he thought scholars had not done enough;
  • Consensus for change–the judiciary is regarded as and is a bureaucracy–there is that consensus among both court leaders, who are legal professionals and with a Party role, and ordinary judges, who are legal professionals;
  • Common achievements of human civilization–that means learning from other countries–China had done so not only in science and technology but also in law and democracy. Chinese judicial  reformers had benefited from the open policy–he himself was an example; and
  • Critical role of strong leadership–legal professionals could not initiate fundamental changes themselves–it needed court and political leadership to do so–he quoted General Secretary Xi Jinping on the ability to do what could not have been done before.

2. How Judicial Reform Actions are Taken

Dean Jiang rapidly made the following six points:

  1. Judicial awareness and enlightenment;
  2. Negative case matters;
  3. Reform for branches and reform for all (parochialism);
  4. Top-down design and comprehensive reform–the court system is part of the political system and reform has to be done by the Central Government;
  5.  Coordination with other departments–in China, unlike in other countries, some matters require coordination with other departments, such as the Ministry of Finance;
  6. A group of devoted experts–both within the judiciary and among academics.

3. From the 4th to the 5th Judicial Reform Plan

Dean Jiang mentioned that the two plans are connected, but that significant differences exist in the value or orientation of the two plans. The fourth one made radical (revolutionary) changes to the judicial system. The fifth one is a new phase, and comes after the completion of the fourth one, which made the following fundamental changes:

  1. Structural changes–delocalizing the judicial system
  2. Status of the judges and prosecutors
  3. Changes to the internal operation of the judiciary
  4. Improvements to the guarantees for judges and prosecutors.

Although these reforms are not completed, these were the focus of their work in the judicial reform office of the SPC and of the Central Government.

The 4th judicial reform plan focused on the following:

1. Separation of administrative region and judicial jurisdiction area–delocalization, as Xi Jinping said, the judicial power is a central power, uniform application of law, so that the law is not applied in favor of one locality;
2. Judiciary-centered litigation system–“in the real world in China, the judiciary does not always have the final say”–and in the past the public security and prosecutors had the final say rather than the judges. The reform to have personnel and financing of courts at the provincial level is part of this reform;
3. Optimization of internal power allocation–as a court is a bureaucracy with different entities with different functions, and the leaders have different functions from ordinary judges;
4. Operation of hearing and adjudicatory power
5. Judicial transparency;
6. Judicial personnel–this is basic but very important; and
7. Independence of the court–this is basic but very important.

The 5th judicial reform plan:

  1. Party’s leadership 
  2. Work for the country’s overall task and situationsubject of one of my forthcoming articles
  3. Litigation service–treat litigants properly and give them judicial services– the courts have public funds to pay for legal representation if people do not meet the standard for legal aid
  4. Judicial transparency–“always on the way”
  5. Responsibility-based judicial operation
  6. Court’s organization and function–reforms in that area (he referred to the recent repositioning of the four levels of the court system, among others)
  7. Procedural system
  8. Enforcement reform
  9. Court personnel system reform–better training of judges
  10. Smart court–using technology

The bolding above reflects his stress on those points in his presentation.

Dean Jiang mentioned that the Central Government put the court system into a bigger picture, but that the prior reforms were needed to make the judicial system more professional.  It is for this reason that the Central Government mentions the phrase “judicial reform” much less than before.

The bigger picture is involving the court system more in the development of the whole country. This reflects a change in China’s overall policy, and we Chinese legal professionals need to understand this.

Comparing the 4th and 5th Reform Plans:

  • Similar, but different;
  • Duplicated, but deepening and supplementary;
  • To those unfinished tasks, less emphasis

He said these should be seen in the context of the national plan for achieving the rule of law, and from 2035, China will have achieved rule of law and be a modernized, democratic country–the second 15-year plan will be about rule of law.  He thinks that the timing is insufficient.

4. Strategic Move: From Judicial Reform to “Zhengfa” (政法) Reform

1. Before 2012, judicial work mechanism reform
2. From 2013,Judicial system reform
3. From 2017,Comprehensive supplementary reform of the judicial system
4. From 2019, Promoting Comprehensive
Reform in Zhengfa Area
5. From 2020,Xi Jinping rule of law thoughts

On point 4 above, that relates to a comprehensive document adopted in 2019 [Implementing Opinion On the Comprehensive Deepening Reforms of the Political-Legal Sector 关于政法领域全面深化改革的实施意见, not publicly available but mentioned previously on this blog], of which judicial reform plays only a small part.  From 2020, Xi Jinping rule of law thoughts plays an important guiding role in the role of law. He said all law students and legal professionals should read it because it will have an important impact on the building of rule of law in China.

Structure of the new arrangement:

  • Breadth: From the judiciary to other related areas
  • Depth: From judicial system reform to broader systematic innovation–the latter means is moving from judicial system reform to areas previously little discussed, such as Party leadership and the role of the Political-Legal Commission, and the relationship between the Party and the law.
  • Goal: From fair, efficient, and authoritative judicial system to modernization of Zhengfa work system and capability—that is, that the judicial system is to be part of a modernized governance system and governance capability [国家治理体系和治理能力现代化–from the Decision of the 4th Plenum of the 19th Party Congress]. That is the goal for the next 30 years. It means the rule of law in the future will have a major part to play as part of modernized governance, and the courts will have an even more important role to play in supporting this modernized state governance (this is in my draft article). It may not be apparent from the English words, but it is a change.
  • Method: From branch-driven to Central Committee-driven–how to get there? He says this wording is not quite accurate as the 4th Judicial Reform Plan was also Central Committee driven, but because the Central Government put the project of the rule of law into the modernization of state governance, it has a different method for treating reform in the legal area, but he thinks that change of method is only an improvement.
  • Nature: Chinese style and self-owned brand–when you read English language literature on building a fair and independent judicial system from abroad you will see many common points. In the current arrangement–in the Zhengfa reforms, Chinese characteristics have a great deal of weight and also in the reconstruction of the legal system. Although China has learned a great deal from other countries, China has to go on its own way, since it has its own history, political situation and historical stage and there is a change in the international situation. China has changed its position in the world. He is getting accustomed to this new way of judicial reform and it will be more difficult for foreigners to understand it.

The change of emphasis can be seen from the VIP (very important research projects of 2021), which are all more general than before:

No. 67. Practice and Experiences of the Party Comprehensively Promote Law-based governance
No. 68. Socialist Legal Theory with Chinese Characteristics
No. 69. Spirit of Socialist Rule of Law
No. 70. Constitution-centered Socialist Legal System with Chinese Characteristics
No. 71. Promoting Comprehensive
Reform in Zhengfa Area

Dean Jiang described the 2019 document mentioned above as containing the following areas of reform.

Seven Areas of Zhengfa Reform:

  1. Party’s leadership of the Zhengfa work–that is the Chinese situation
  2. Deepening reforms of Zhengfa institutions–not only the courts and the prosecutors, but changing the overall structure of Zhengfa institutions
  3. Deepening reform of systems of law implementation–we combined  Legislative Affairs Office (of the State Council 法制办) into the Ministry of Justice [MOJ]–that’s an important change
  4. Deepening reform of social governance system–the Zhengfa Wei important for social governance–one of the most popular words is “governance“–how to support social stability, social development; innovative spirit, people’s lives;
  5.  Public Zhengfa service system–public legal service is part of Zhengfa service–all the political-legal organs will work together to provide efficient high-quality services for the people-人民为中心–Xi Jinping says all our work needs to be people-centered;
  6. Zhengfa profession management reform–no major change here
  7. Application of IT technology–no major change here–continued application of IT in the Zhengfa area

These are seven areas of Zhengfa reform, based on the prior judicial reforms, but now going to a new stage. Governance is a crucial word.

5. Technical Measures

This is what he has devoted his life to before.

  • Law is a profession, and the judicial system is the carrier of law and justice.
  • Law is also science of law.
  • Rule of law is one of the most technical way of state governance.
  • Rule of law will have no efficacy without the joint efforts of other institutions.

He listed 10 legal issues for consideration for reference and research, as these are the most important topics:

  1. Structural reform: local judicial power, or central judicial power–at the present time, the Central Government cannot manage all those 200,000+ judges and prosecutors, and at first stage, the provincial level is taking that over, but he is not sure of the final judicial model
  2.  Organizational reform: bureaucratic or judicial, especially the internal organs–this is a more technical reform, including internal and external organs, different tiers of the court and branches of the judiciary, including the procuracy;
  3. Functions of the four tiers of court:  their role and function–cylinder, or cone (his metaphor of 20 years ago)–should the SPC concentrate on judicial interpretations and a small number of cases, and does not need 400 judges–this relates to the pilot program of late last year on the repositioning of the four levels of the Chinese court; the local courts will focus on factual issues;
  4.  Personnel reform: Profession, or ordinary public servant–this is still an ongoing issue, and in his view, some continental European countries have not resolved this issue either. Although there are improvements, judges and prosecutors feel that it is not sufficient, given their new role in society, and the importance of their work. He agrees, having been a former judge.
  5.  Procedural reform: Court-centered litigation system, fair trial, simplification of procedure–how to make things fairer, and given the more than 10% annual increase in cases, a big burden on judges in particular, how to simplify procedure. This links to the recent amendments to the Civil Procedure Law, which focuses on simplification of procedures and giving online procedures the same status as offline.
  6.  Adjudication committee: advisory, or adjudication–there is a great deal of discussion about it–it is the highest decision-making body in a court (see this blogpost).
  7. Judicial responsibility system: The hearing officer makes the decision, and decision-maker takes the responsibility–司法责任制–this is another tricky one–this is required by the Central Government, a step forward towards the rule of law, instead of having a judge’s boss approve his decision (because the court is bureaucracy)–for China, this is a step towards the rule of law, but there is still a long way to go.
  8.  Supervision over “four types of cases”–that means for most cases, judges take responsibility for their cases, but for difficult, controversial, and possibly having an impact on social stability–because junior judges have different capacities from the more senior–for those four types of cases, the court president and senior court leaders are involved to oversee or supervise (see translation of guidance here, commentary to come)–he has not found useful academic papers on this point;
  9.  ADR (Diversified dispute resolution): this is a traditional topic–optimizing the allocation of resources of dispute resolution
  10. Judicial administration: local government loses its administrative power, but what internal administration;
  11. Judicial democracy: lay judge system–different from common law jury (but China can learn from the common law jury–having them focus on factual rather legal issues)–the law has changed, but academic work is insufficient.
  12. Judicial transparency–this is an old issue, to make the judiciary more transparent to the parties and the public.

These are the major issues in the next five years. These technical legal issues are very interesting and need legal scholars to look at them to support the Zhengfa reforms.

6. Future Direction

  1. Xi Jinping rule of law thoughts–inevitable guideline–some of political and strategic, but it provides some guidelines for basic principles;
  2.  Rule of law-driven first;
  3. Politics driven and guarantee–politics should be a consideration but it should not be unbalanced.  Political role of the rule of law-leading the legislative institutions.  Guarantee means guaranteeing the executive implementation of law, supporting the judiciary, and being a model of a law-abiding citizen; This will be very important in putting judicial reform forward;
  4. To complete those halfway reforms–judicial personnel reforms;
  5.  More rethought and theoretical guide–scholars criticize the judiciary for having an insufficient theoretical basis;
  6.  Dealing with the other judicial civilizations–we never stopped, especially in technical areas, and for our legal professionals, that has never stopped. We need to work together for all of humanity.

Supreme People’s Court Monitor 2019-2021 Year-end Reports

Screenshot 2018-12-07 at 5.48.29 PM
The Monitor as “Fargo North” Decoder

The Supreme People’s Court Monitor published 35 posts in 2019, 26 posts in 2020, and 26 in 2021, with about 34,000  page views each year,  primarily from:

  • United States;
  • (Mainland) China;
  • Hong Kong SAR;
  • United Kingdom.

Germany, Australia and Singapore trailed the others by a significant margin. Mainland China was in second place in 2019.  In 2020 and 2021, the Monitor had almost the same number of views from mainland China and Hong Kong.  I wish I knew the distribution of my readers in mainland China–whether they are working in the System (体制), or are academics, students, or lawyers. I was very pleased to meet some readers when I spoke in November 2019 at the Fourth Qianhai Legal Intelligence Forum, (a conference held annually in Shenzhen, supported by the Supreme People’s Court (SPC)).

Why did I do less blogging in 2020  and 2021 as compared to 2019? Perhaps it can be attributed to competing professional obligations–including writing several academic-style articles and one academic blogpost.  Fortunately, 2021 saw the academic blogpost and three long articles emerge from the academic publishing machine.  I have yet to see the third long article (book chapter), which has been published. I presume that one is stuck in a warehouse, awaiting the resumption of flights from the rest of the world to Hong Kong.

One draft academic article, in which I have invested too much time,  is back on the back burner after two perceptive readers pointed out what I was feeling, that it had gone down too many research rabbit holes (掉进无底洞).   I now know that an SPC document will be issued soon that I presume will change some of the article’s content, so it is just as well that the draft is back on a slow simmer. I’m instead following the advice of one reader to spin off parts of the draft into separate articles. One will soon be ready for the editorial sausage machine.  A second one, on a topic separate from the “rabbit hole” article,  is affected by documents issued to implement the recent reforms to the four levels of the Chinese courts as well as the Civil Procedure Law amendments.  When I return to that “rabbit hole” article, it will benefit from what I have learned in researching the one that I expect can enter the editorial sausage machine soon.

In the New Era (and the Covid-19 Era), it is an even greater challenge to decode for readers outside of mainland China SPC developments insightfully in under 1500 words.  I hope I have gone some way to meeting that target.  I sometimes have my doubts.

Since the blog was founded almost nine years ago:

Page views: 233, 109
Jurisdictions: 200? (per WordPress)
Posts: 323

Most followers use Twitter to follow the Monitor. Although Twitter is not accessible in mainland China without a VPN, 16% of the Monitor’s Twitter followers are based there.

A special thank you to my anonymous “peer reviewers”, who have given forthright (in one case very blunt), insightful and helpful comments on draft blogposts.

Supreme People’s Court’s 2021 Year-End Accomplishments

Photo from the “look back meeting” described below

Apologies to readers for the long gap between posts–I have been focusing on yet another academic article and am finding that even so-called “short articles” take much longer than anticipated, especially when the topic reveals more and more complexities than were apparent when I submitted the abstract to the journal months ago.

So instead of any involved analysis, I’ll list some of the year-end (from December) accomplishments of the Supreme People’s Court (SPC) with some brief notes. Another aspect of the SPC being a cross between a Party-state organ and a court is that it needs to meet year-end goals and submit year-end reports. The SPC’s judicial reform leading group recently discussed and approved its year-end report (最高人民法院司法改革领导小组2021年工作总结报告).  The judicial reform leading group is headed by President Zhou Qiang. Other members include Justices He Rong, Ma Shizhong (head of the Political Department), He Xiaorong, and Shen Liang. The Judicial Reform Office presumably drafted by the report. It is likely a constituent part of the SPC’s year-end report to go to the Party leadership, before the annual Central Political-Legal Work Conference.

Another aspect of the SPC being a cross between a Party-state organ and a court is that it is inspected by Party inspection groups and is a focal point of campaigns on the education and rectification of political-legal organs.

Among the SPC’s year-end accomplishments are the following.  For the avoidance of doubt, judicial interpretations, judicial documents, and typical cases are all means by which the SPC guides the lower courts. I will have more to say about this topic in the unfinished academic article mentioned above.

Judicial interpretations

  1. Online Mediation Rules of the People’s Courts (人民法院在线调解规则).  Online mediation is an important focus of the SPC, as could be seen from this white paper on Diversified Dispute Resolution from early 2021 and from other efforts of the SPC to promote resolving disputes at their source, as consistent with the deployment of the Party Center (党中央关于“将非诉讼纠纷解决机制挺在前面”的重大部署要求.  The responsible person of the SPC’s Case Filing Division (presumably the head) pointed out that these rules “had created an online diversified dispute resolution model with Chinese characteristics that differed from ADR or ODR” )形成了有别于ADR和ODR的中国特色在线多元纠纷解决模式). His statement appears designed to be more politically correct than accurate. It is clear that the SPC follows government policy in using “diversified dispute resolution” rather than “alternative dispute resolution,” (ADR)  but the English language abbreviation”ODR,” according to my research, is intended to be a general term to capture all sorts of online dispute resolution and not meant to promote one particular model of online dispute resolution. The underlying implication is that “ODR” reflects a “Western” approach. However other (mainland) Chinese government departments use “ODR” without issue.  Additionally, the Hong Kong government uses the term “ODR” to refer to its online dispute resolution platform, eBRAM.
  2. Interpretation of the Supreme People’s Court and the Supreme People’s Procuratorate (SPP) on Several Issues Concerning the Application of Law in Handling Criminal Cases Endangering Food Safety (最高人民法院 最高人民检察院关于办理危害食品安全刑事案件适用法律若干问题的解释). As a joint judicial interpretation, it was approved by the judicial (adjudication) committee of the SPC first and next by the Procuratorial Committee of the SPP.
  3. Several Provisions of the Supreme People’s Court on the Application of Prohibition Order Preservation Measures in Eco-environmental Infringement Cases(最高人民法院关于生态环境侵权案件适用禁止令保全措施的若干规定) –relating to injunctions to stop environmental pollution, either before or after a party has filed suit.  We can expect more and more SPC interpretations and documents related to environmental pollution.
  4. Relevant Provisions of the Supreme People’s Court on Issues concerning Applications for Verification of Arbitration Cases under Judicial Review 最高人民法院关于仲裁司法审查案件报核问题的有关规定. This decision by the SPC updates the 2017 provisions of the same name, adding one article and a clause in another. The new Article 3  requires higher people’s courts to submit draft rulings in judicial review of arbitration matters in domestic arbitration (non-foreign, Hong Kong, Macau or Taiwan-related) if the higher court intends to concur with a lower court ruling that the arbitral award violated social public interest.   The new second clause of Article 4 requires the higher people’s court to submit the matter to the SPC within 15 days.
  5. Several Provisions on the Compulsory Enforcement by People’s Court of Company Shareholding (最高人民法院关于人民法院强制执行股权若干问题的规定). This appeared on the 2019 judicial interpretation agenda, so it has slipped by two years. The provisions apply to enforcing judgments or rulings against shareholder equity in either limited liability companies or companies limited by shares, but not including companies limited by shares that are listed.
  6. Interpretation of the Supreme People’s Court on Several Issues Concerning the Application of Law in the Trial of Disputes over Compensation for Personal Injury in Railway Transport
    最高人民法院关于审理铁路运输人身损害赔偿纠纷案件适用法律若干问题的解释  This interpretation concerns persons injured in railway transport accidents, excluding accidents on passenger trains.

On the “coming attractions” discussed in some earlier blogposts, the SPC’s judicial committee (adjudication committee) spent many hours on 30 December 2021 discussing the draft judicial interpretation of the General Part of the Civil Code.  When I wrote last about the draft of the General Part, I noted that Judge Guo Feng, deputy head of the Research Office,  mentioned that the General Part (1) interpretation is scheduled to be submitted to the SPC’s judicial (adjudication) committee before year-end.  That means that Judge Guo (and likely one or more of the principal drafters) were in the room to discuss the draft article by article.  The judicial committee finally decided to approve the draft “in principle.”  Approval in principle” (原则通过), as discussed here, is not mentioned by the SPC’s 2007 regulations on judicial interpretations but is one of the SPC’s long-established practices. It means that the judicial committee has approved it, subject to some “minor” amendments. Minor amendments are more than typographical errors and relate to specific substantive matters.  So it is likely that after the SPC amends the provisions that the judicial committee  considered needed more work, a quasi-final draft will go back to the National People’s Congress Standing Committee (NPCSC LAC)’s Legislative Affairs Commission  because SPC guidance provides that “liaison with the NPCSC LAC must be timely, and after major revisions to the judicial interpretation draft after consulting with the NPC LAC, the view of the NPCSC LAC  should be solicited again.”  I expect that the draft of the General Part judicial interpretation will be finalized before the National People’s Congress meeting, so that the report can mention this accomplishment.

As I have mentioned many times in the course of 2021, we do not know what was on the SPC’s 2021 judicial interpretation agenda. Those of us outside the System can only hope that the 2022 agenda will be released and that the judicial reform agenda will continue to be released.

Judicial documents (incomplete list)

  1. Provisions of the Supreme People’s Court and the Ministry of Justice on Providing Legal Aid for Defendants in Death Penalty Review Cases 最高人民法院 司法部关于为死刑复核案件被告人依法提供法律援助的规定.  These are joint regulations issued by the two institutions and therefore are classified as “judicial documents,” as discussed here.  These provisions establish a mechanism for the Ministry of Justice to appoint legal aid lawyers to defendants whose cases are being submitted to the SPC for death penalty review.  If a defendant appoints his or her own lawyer), then the legal aid lawyer stops providing services.
  2. Provisions on Judges’ Disciplinary Work Procedures (for Trial Implementation)《法官惩戒工作程序规定(试行).  I will follow up with analysis at some point as I published a book chapter on judicial discipline at the beginning of 2021.  These provisions do not change the conclusion in my chapter.
  3. Opinions on Strengthening the Substantive Trial of Sentence Reduction and Parole Cases (关于加强减刑、假释案件实质化审理的意见).  This is another multiple institution document, intended to tighten up procedures for sentence reduction and parole cases.  They are in part a response to a 2020 tragedy in Beijing, in which a prisoner whose sentence was commuted killed one man and injured two more.  The incident further revealed that the corruption discussed in this 2015 blogpost continues to exist.
  4. Notice of the Supreme People’s Court on Studying and Implementing the “Decision of the Standing Committee of the National People’s Congress on Amending the Civil Procedure Law of the People’s Republic of China.”最高人民法院关于认真学习贯彻《全国人民代表大会常务委员会关于修改〈中华人民共和国民事诉讼法〉的决定》的通知.  This notice and the amended Civil Procedure Law are of practical importance to tens of thousands of Chinese judges and litigants in the Chinese courts, individuals and entities, domestic and foreign.  The notice signals that the SPC is working on amendments to the Civil Procedure Law judicial interpretation (the previous version plus commentary was published in two volumes). This reform relates to the reorienting of four levels of the courts, will increase the number of cases heard with one judge, promotes mediation and smart courts.
  5. and  6. Two Judicial Services and Safeguards Opinions, one on  Providing Judicial Services and Safeguards for Promoting the Development of the West in the New Era and Forming a New Pattern and  Opinions on Providing Judicial Services and Safeguards for Promoting the High-quality Development of the Central Region in the New Era(最高人民法院关于为新时代推进西部大开发形成新格局提供司法服务和保障的意见( and 关于为新时代推动中部地区高质量发展提供司法服务和保障的意见.  Related to these two is a document from November 2021– Conference Summary of the Work Promotion Meeting Serving and Safeguarding Ecological Protection and High-quality Development of the Yellow River Basin.最高人民法院服务保障黄河流域生态保护和高质量发展工作推进会会议纪要.  That document in turn relates to a  2020Judicial Services and Safeguards Opinion. These are part of a large number of documents providing judicial services and safeguards for Party Center strategies and initiatives, particularly related to regional integration.  The article I have temporarily set aside to write this blogpost discusses the purposes and impacts of these documents.  I have previously written about these documents often, such as these quick analyses of their structure and purposes.  Both  Opinions link to Party Center-State Council documents. More analysis to come when I am able to finish the last five pages of the “short academic article” mentioned above.

Reshaping the judiciary

In the fall of 2021, the Party Center launched the second round of the rectification and education of national political-legal organs, with a leading group leading and an office assisting in implementing the campaign. The SPC was one of the focal points (along with other central organs). Just before Christmas, the SPC held a “looking back” meeting to discuss what was revealed and progress made in response.  The SPC established a leading small group and office to handle matters properly.  (For those interested in further details, please see this webpage.) President Zhou Qiang noted in his work report that the SPC has effectively rectified a batch of stubborn diseases (one of the targets of this inspection) and resolutely eliminated a batch of black sheep (literally, a group of horses that harm the masses) (一批害群之马).  The same phrasing is reported from the Ministry of Justice and other political-legal institutions at both the central and local levels. Related to  the rectification and education campaign are several new SPC opinions. Those include one strengthening the judicial responsibility system, and creating a new court team  关于在加快推进司法责任体系改革和建设中进一步加强人民法院队伍建设的意见 and another on enforcement.  The SPC has issued another related opinion found here, on the “four types of cases.”   Perhaps unrelated to stubborn diseases and black sheep is decisions by some SPC judges to continue their careers elsewhere.

Finally

I wish all readers a happy and healthy new year, both “Western” and Chinese.  I also hope that this year brings us, located in and out of mainland China, opportunities to gather together to discuss legal developments in China from different perspectives quietly, without rancor or blame, but with mutual respect.

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I would like to express my appreciation to two anonymous peer reviewers of a previous draft of this blogpost. Special thanks to the person who caught a significant error in the draft.

 

Update on Civil Code Judicial Interpretations

Judge Guo Feng at a workshop at Tsinghua University

Judge Guo Feng, deputy head of the Supreme People’s Court (SPC)’s Research Office, with the ranking of first level inspector (a senior non-leadership position  ( 一级巡视员spoke in late October at the annual meeting of the China Law Society’s Civil Law Research Group, at which he revealed further information about the SPC’s timetable on issuing further interpretations of the Civil Code, as well as senior SPC leadership’s thinking about judicial interpretations.  Please see this recent blogpost if a refresher about judicial interpretations would be helpful. I have italicized my brief comments.

In his remarks, he revealed the methodological thinking behind the drafting of the Civil Code judicial interpretations.  He expresses a principle that I have heard from others at the SPC–that there is a  palpable line between the SPC’s power of judicial interpretation and the NPC’s legislative power and power of legislative interpretation.  For many in the legal world outside of China (and some inside China based on this and several other recent academic articles), it appears to be an invisible red line. As for what should be the focus of judicial interpretations, I believe that internally they will be able to have a sense, from discussions with colleagues in other divisions, lower court judges and from lawyers, if comments are sought from them:

The first is how to grasp the degree, that is, how to achieve an appropriate degree in the design and expression of the specific content, specific system, and specific clauses of judicial interpretation. The core of moderation is how the judiciary can perform its duties and responsibilities in accurately applying the law, and cannot overstep and covet the legislative authority’s legislation and the power of legislative interpretation.

The second is how to achieve a balance of quantity, that is, in the face of the 1,260 legal provisions in the seven parts of the Civil Code, which ones should be judicially interpreted? What should not be judicially interpreted? Which Parts and which chapters should be the focus  for some judicial interpretations? Furthermore, in each separate judicial interpretation,  how much content and complexity should be in each provision?

Interpretation Agenda & Timetable

Judge Guo mentioned that the Civil Code judicial interpretations on the judicial interpretation agenda include one on the General Part and the Contract Parts of the Civil Code. The General Part Judicial Interpretation (1) draft (最高人民法院关于适用<中华人民共和国民法典>总则编的解释(一)》was discussed this spring. The Contract Part interpretation has been discussed at several other academic conferences in Beijing besides the one described in the earlier blogpost.

Judge Guo mentioned that the General Part (1) interpretation is scheduled to be submitted to the SPC’s judicial (adjudication) committee before year-end and the Contract Part Judicial interpretation is scheduled to be submitted to the judicial (adjudication) committee by the end of the first quarter of 2022.  I surmise that Court President Zhou Qiang wants to include the promulgation (or the upcoming promulgation) of the Contract Part of the Civil Code as one of the SPC’s accomplishments in 2021. So I have my doubts that public comments will be sought on the draft. The Tort and Personality Rights judicial interpretation drafts are still at the research stage.  He also mentioned that they do not plan to issue a comprehensive draft of the Personality Rights Part, but instead be guided by practice, and focus on issuing an interpretation on Article  997 (relating to the right of a party to seek an injunction to stop violations of the person’s personality rights). On the Contract Part judicial interpretation, I had previously said “as to whether this judicial interpretation will be issued by the end of this year, I personally have my doubts. “

Issues Going Forward

Judge Guo mentioned that they are facing issues concerning overlapping provisions in different parts of the judicial interpretations of the Civil Code, such as the provisions in judicial interpretation of the General Part of the Civil Code overlapping with provisions in the judicial interpretation of Contract Part, and overlapping provisions between the Personality Rights Part and the Tort Part.  He says that these issues regarding the planning of the interpretations need to be solved by the academic community and the SPC together. I have my doubts, however, that those in the academic community, unless they have spent time at the SPC, will be able to provide useful advice to the drafters on how to harmonize the different provisions in the judicial interpretations of the Civil Code in a user-friendly way, that enables an overworked basic level court judge (or her judge’s assistant or intern) to quickly and easily find the correct rule.

Finally,  Judge Guo mentioned that the SPC’s judicial committee decided that in the future, it will no longer engage in large and comprehensive judicial interpretations, and will no longer engage in excessively lengthy judicial interpretations, and encourage focused judicial interpretations.  My guess is some persons in the political leadership commented on the long judicial interpretations, of which the SPC has issued quite a few in the past few years.  I imagine that this will be the case until the amended Arbitration and Bankruptcy Laws are promulgated.  Then there will be a demand from the lower courts and the Chinese legal community for comprehensive judicial interpretations that consolidate previous interpretations, to the extent relevant, discard irrelevant provisions, and provide further detail to new provisions.  

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Many thanks to certain anonymous readers of an earlier draft of this blogpost. They are not responsible for any errors or “erroneous views.”

Reorienting the Four Levels of China’s Court System–Part 1

At the end of September, the Supreme People’s Court (SPC) issued Implementing Measures for the Pilot Reform of Improving the Positioning of Four Levels of Courts in Terms of Adjudication Levels and Functions  (Four Level Court Reform Pilot Measures). The only translation available seems to be behind Westlaw China’s paywall.  A quick summary of its backstory, provisions, and implications as related to the SPC follows below. The impact on the lower courts will be significant, but this reform needs to be analyzed together with other current reform documents to see the larger picture.

Backstory

As the NPC Observer previously wrote, this reform was included in both the 2019 SPC’s fifth five-year court reform plan and the recent Plan for Building the Rule of Law in China (2020–2025).  The National People’s Congress Standing Committee granted the authorization for this Pilot Reform in the summer.  SPC President Zhou Qiang highlighted the principal reforms in his explanation to the NPC Standing Committee. The Party leadership (the Central Deepening Reform Commission) approved the reform in June, based on submission documents from the SPC. The drafters of the reform stated the proposal (改革方案稿) was based on research and specialist discussions  (调研论证, although neither the approval document nor the submissions are available).  I surmise that the research draws on earlier work by predecessors of the drafters. The roots of this reform can be seen in the SPC’s fourth five-year court reform plan, for which the SPC issued extended commentary (thankfully for the researcher).  SPC research on this issue dates back to the spring of 2012, if not earlier.

This reform is one of many court (and other political-legal system) reforms that the Party leadership approved in January 2019, as part of its Implementing Opinion On the Comprehensive Deepening Reforms of the Political-Legal Sector《关于政法领域全面深化改革的实施意见. That meant that the measures approved in that document became important reform responsibilities (tasks) for the institutions involved (确定的重要改革任务).

The outside analyst of this and another court (and other Chinese legal) reforms is at a disadvantage in seeking to be thorough as might be possible in more transparent jurisdictions. It is not possible to know, for example, what the Party leadership reviews when it considers these submissions (my guess is a detailed executive summary, while responsible aides read more extended reports) and whether the SPC’s submission was approved unchanged.

What It Means for the SPC

The Four Level Court Reform Pilot Measures cover civil, administrative, and criminal cases, with the focus on civil and administrative cases. Among the objectives of the Four Level Court Reform Pilot Measures is to make the SPC a supreme court (with Chinese characteristics), rather than just China’s highest court.

As I wrote in my short article on the U .S.-Asia Law’s website and earlier on this blog, the SPC considers large numbers of retrial applications, primarily in the circuit courts.  This document narrows considerably the flow of retrial applications that can be submitted to the SPC, although the new standards incorporate necessary flexibility.   (Ironically, I have just written an article on this process).

The intent is for the SPC to focus on a smaller number of more important cases. As stated in Article 1: “the Supreme People’s Court shall focus on supervising and guiding adjudication work at the national level and ensuring the correct and uniform application of the law.”

According to the drafters’ commentary, the intent is for the SPC to focus on (judicial/legal) policy formulation (政策制定) and social governance (社会治理), about which I spoke recently, and is a subject of another forthcoming article. This has been the thinking of the SPC leadership for over five years, if not longer–Judge He Xiaorong, current head of the #2 Circuit Court (and former head of the SPC’s judicial reform office) stated six years ago–when writing about the circuit courts:”

…the center of the work of SPC headquarters will shift to supervision and guidance, primarily trying cases that have a major guiding function in unifying the application of law, that can become guiding cases.”

The drafters of the Four Level Court Reform Pilot Measures state that the intent is to establish a working mechanism in which the Supreme People’s Court judgments are directly transformed into guiding cases and promote relevant judgments to become an important source for optimizing the formulation and content of judicial interpretations, as well as modifying and abolishing judicial interpretations.  We will need to wait for further measures from the SPC on this.

Narrowing the Flow of Retrial Cases

The 2021 reforms change the standard of review for civil and administrative cases. The reforms set out a two-branch test: compulsory and permissive jurisdiction. Under Article 14, compulsory jurisdiction includes cases in which:

  1.  the higher court’s ruling or judgment was erroneous and the case has guiding significance in the application of law; or
  2. in the past three years, higher people’s courts have unresolved major differences in the application of the law in similar cases for which binding judgments or rulings have been rendered by the SPC or different high people’s courts; or
  3. any other circumstances where the SPC considers it should here the cases.

The language of #3 is familiar language to anyone who spends time reading Chinese legislation.

Article 11 sets forth conditions under which applicants can apply to the SPC for retrial, but the SPC has flexibility in accepting the cases:

  1. applicants consider that the higher people’s court applied the law erroneously, but do not object to the facts determined, principal evidence, and procedures of the higher people’s court, or
  2. if the court’s judicial (adjudication) committee considered the case.

Article 13 authorizes the SPC to remand a case back to the higher people’s court if it considers that there are unclear facts or procedural errors, or alternatively, the higher people’s court erred in applying the law, but the issue does not merit SPC consideration.

Applicants must make an undertaking when applying for reconsideration that they undertake not to object to the above matters, and are directed to focus their application on the disputed issues and the grounds for their argument. At this point, detailed implementing measures have not yet been issued.

Inconsistent Decisions

One issue that the drafters mentioned in their commentary is inconsistent judgments or rulings made by different divisions of the SPC.  In practice, that issues relating to the same body of law may be determined by different divisions of the SPC or different teams of SPC judges in the circuit courts and headquarters. They arise either through litigation or court administrative-type procedures. While SPC judges  (as I understand it) search for similar cases, it is inevitable that different people have different views on legal issues.  An example of this arose recently in the area of arbitration law, in which the SPC’s Intellectual Property Court ruled that the arbitration agreement in a software contract providing for foreign arbitration was invalid, because the dispute lacked a “foreign element,” while the SPC’s #4 Civil Division has upheld arbitration agreements providing for foreign arbitration between two Chinese parties.

In that earlier blogpost  I wrote that, unlike some other legal systems, the SPC has not evolved an en banc or enlarged panel of judges, but the Four Level Court Reform Pilot Measures illustrates that someone involved with court reform has looked to other jurisdictions and borrowed but not transplanted the concept. For the avoidance of doubt, borrowing legal concepts from abroad is consistent with Xi Jinping Legal Thought.  The Plan for Building the Rule of Law in China (2020–2025) includes among its main principles: “learn from the useful experience of foreign rule of law (借鉴国外法治有益经验).”

Articles 18  and 19 set forth two options for resolving cross-division differences in views on legal issues.  Article 18 involves the creation of an enlarged collegial panel with five or more members from different divisions.  Consistent with the SPC’s administrative nature, the divisions (circuit courts, or intellectual property court) must apply to the SPC’s Trial Administration Office, which in turn must seek the approval of the SPC President.  The  President may designate a Justice (SPC Vice President) to sit as the presiding judge.  The alternative set out in Article 19 is to apply to the Trial Administration Office to establish a cross-division specialized judges committee (its functions discussed here). I surmise that the second alternative will be used more frequently.

What to expect?

I surmise that there will be a transition period, as the cases accepted under the old retrial system are processed by SPC headquarters and circuit courts.  So my guess is that 2022 will see fewer cases than 2021 and 2020, and 2023 will see even fewer cases.  I expect that the SPC’s Intellectual Property Court to continue to have a large number of cases (over 3000 in 2020).  In 2020, the greatest proportion of their cases were civil and administrative appeals. My uninformed guess is this trend will continue.

It is possible that as a consequence of this reform, the China International Commercial Court will hear more cases than before.  But as I said and wrote earlier this year, I surmise that they will continue to pick their cases carefully, focusing on those which raise issues in which existing law and judicial interpretations are unclear and involve issues that frequently arise in practice. These CICC principles are consistent with those in the Four Level Court Reform Pilot Measures.

As for the other divisions of the SPC, my guess is that they will be able to find enough major cases to keep themselves busy while also spending more time on judicial policy and judicial interpretations, not to mention other matters.  The principles in this reform do not affect long-standing mechanisms of the SPC, such as death penalty review or the prior review of arbitration-related decisions by the #4 Civil Division. As I hinted in a recent blogpost, I believe that in the next year or two, a great deal of time will be invested in issuing judicial interpretations to fill out the broad principles of the Civil Code, but the interpretations will themselves be issued in a codified fashion.

How & Why the Supreme People’s Court serves the Belt & Road Initiative

I’m honored to be speaking in a few days (remotely) in a webinar sponsored by the Pacific-Asian Legal Studies program of the University of Hawaii at Manoa’s William S. Richardson School of Law on how and why the Supreme People’s Court Serves the Belt & Road Initiative (sign up link is here).

The event will take place at 2 pm, 5 November, Hawaii time, which translates into 8 am on 6 November in the GMT +8 timezone (Hong Kong, mainland China, Singapore, etc.), 11 am in Sydney, and 8 pm on the US East Coast.  The timing doesn’t work well for England (midnight) or Europe. I believe a recording will be available at a later date.

 

 

Coming Attractions on the Supreme People’s Court’s Foreign-related Commercial & Maritime Law Agenda

Justice Tao Kaiyuan

Because the Supreme People’s Court (SPC) has not released its judicial interpretation agenda for 2021 (as previously mentioned), the observer seeking to determine what is on that drafting priority list and must rely on occasional reports in the professional and academic press. In August, SPC Vice President Tao Kaiyuan, (link to her speech at the Brookings Institution in 2015) who appears to have assumed responsibility for the #4 Civil Division and foreign-related commercial and maritime matters, published a short article in one of the SPC’s media outlets. For those able to read the language of SPC official documents, her article provided insights into future developments, ongoing issues, expanding the Chinese courts’ circle of friends, and the qualities that Chinese judges must possess.

Future Developments

Justice Tao released information on the following developments:

  1. The SPC will issue a Conference Summary on the 2021 National Symposium on Foreign-Related Commercial and Maritime Trial Work (2021年全国涉外商事海事审判工作座谈会会议纪要) to resolve difficult issues in practice and unify judgment standards.  She did not further detail the difficult issues that need unifying in the Conference Summary. As mentioned here, although conference summaries are not judicial interpretations and cannot be cited in a court judgment document as the basis of a judgment, it is generally recognized that provide important guidance to the work of the courts and judges will decide cases according to its provisions.  Generally, they are issued to address issues regarding which the lower courts have inconsistent views, but time or the fluidity of the situation does not permit a judicial interpretation to be issued.
  2. The SPC is in the process of researching and drafting a judicial interpretation on the application of international treaties and international practices (研究制定涉外民商事案件适用国际条约和国际惯例). This topic has been mentioned in previous Belt & Road- related opinions. I surmise that it was finally realized that this topic needed to be addressed if the Chinese courts are to be increasingly engaged with the outside world, as is signaled by the Party’s Five-Year Plan for Constructing the Rule of Law (2020-2025);
  3. The SPC is drafting a judicial interpretation on the ascertainment (determination) of foreign (extraterritorial) law in foreign-related civil and commercial cases. This, too, is a long outstanding issue, mentioned in earlier blogposts including one from 2014;
  4. SPC and the Supreme People’s Procuratorate are researching and drafting a judicial interpretation on compensation for damages to marine natural resources and the environment. I surmise the interpretation will address cases with both criminal and civil aspects, relating to compensation for harm to the environment.
  5. Justice Tao mentions that SPC judges will continue to participate in the UNCITRAL  Working Group VI draft convention on the judicial sale of ships, the Hague Conference on Private International Law Jurisdiction Project, and the other drafting international rules.  As I have previously mentioned, while sometimes the SPC sends one of its judges to participate in the Chinese delegation negotiating an international convention, in other projects other central institutions take the lead in negotiation and consult with the SPC on issues relating to the courts.  She did not mention the hard work needed to harmonize Chinese legislation with international conventions.

Ongoing Issues

Justice Tao also mentioned that the SPC will continue to research parallel proceedings, cross-border bankruptcy, cross-border data transfer, sovereign immunity, and other such issues.  I surmise that cross-border bankruptcy is high on the research priority list, as the National People’s Congress Standing Committee has started work on amending the Bankruptcy Law, but cross-border data transfer is an important one as well. Parallel proceedings, in my view, are likely to become a greater, rather than a lesser point of tension between China and certain other jurisdictions.

Expanding the SPC’s Circle of Friends

Justice Tao has a paragraph on China deepening international judicial cooperation and continuing to expand the Chinese judiciary’s “circle of friends”(朋友圈). She mentions actively creating opportunities for Chinese judges to enter the international judicial stage, participate in important international conferences and international forums, learn about the experience of foreign counterparts in the rule of law, strengthen the external communication of China’s judicial system, judicial culture, and judicial reform.

As seen from my perspective, many opportunities for Chinese judges to speak exist, but overly complicated bureaucratic procedures with which they must comply set formidable obstacles preventing them from directly communicating with the outside world. I’ll eventually have more to say on the SPC and its communication with the outside world, but others could use the SPC’s English language website  (about which I previously commented) as one of many measures of the quality of its foreign discourse.  I have heard a number of SPC judges speak to foreign audiences.  Some, particularly those who have spoken at Hong Kong International Arbitration Centre or other arbitration-related events, have a keen sense of their foreign audience, but others package five or ten minutes of insightful remarks, generally at the end, preceded by twenty minutes if not more of press release type information, by which time they have lost the audience.  Justice Tao does not mention interactions going in the other direction, that is, expanding their circle of friends by welcoming foreigners to the Chinese courts as interns or affiliated scholars. The Chinese courts continue to benefit from the Federal Judicial Center’s hospitality to (the late) Judge Zou Bihua and other Chinese judges.  

Qualities of Foreign-Related Judges

In the concluding section, Justice Tao addresses the need for training (about which I have written recently) and the qualities required of  Chinese judges focusing on foreign-related commercial and maritime matters.  Those qualities mirror current policy on judicial personnel, as previously discussed on this blog–they must be both politically and professionally competent and ethical.

China’s Civil Code to have a Contract Part Judicial Interpretation

photo of workshop

Because the Supreme People’s Court (SPC) has not released its judicial interpretation agenda for 2021 (as previously mentioned), the observer seeking to determine what is on that drafting priority list must rely on occasional reports in the professional and academic press.  Last month, several academic Wechat accounts reported on discussions of a draft of a judicial interpretation of the Contract Part of the Civil Code  民法典合同编司法解释(草案). The one I’m relying upon contains the more detailed report on the discussion, including the names of those discussing the draft on behalf of the SPC.  I’ll flag from this article why this discussion was held, what can be learned from the report on the discussion, and a quick preview of the interpretation itself.  But first, a few words about why this interpretation is needed and what it is intended to do.

Background on judicial interpretations

Through judicial interpretations, the SPC is seeking to “unify court judgments,”  to ensure that court decisions throughout the country and at various levels of courts are more consistent.  This principle is set out in the current and previous judicial reform plans. Establishing a Chinese case law system assists in this, but is insufficient.  As seen from the SPC, judicial interpretations are intended to address issues in which statutory law is either ambiguous or contains a gap, causing judges to misunderstand (the law) and issue decisions inconsistent with legislative intent (see more below).  The SPC  identifies those issues through the multiple stages in the judicial interpretation drafting process.

.Judges, particularly at the basic level, need to issue judgments efficiently in commercial cases. They face a combination of a large number of cases and relatively short deadlines in domestic civil procedure.  Recent reforms to the jurisdiction of the courts will require basic level courts to deal with even more cases.   They cannot assume that most cases will settle, as shown by my own research (concerning certain courts) and those of some others  (in certain courts) . The Contract Part of the Civil Code is not detailed enough for judges to rely upon to decide contract cases efficiently and consistently.  A more active National People’s Congress (NPC)  (and its Standing Committee) is not able to fill in the gap.  Therefore the SPC must be the one to do so.

As I have written before in this blog and in my recent book chapter, the SPC and the NPC, and NPC Standing Committee (NPCSC), most often the NPCSC Legislative Affairs Commission (LAC), communicate during the course of judicial interpretation drafting.  SPC rules require that a judicial interpretation draft be submitted to the relevant committees of the NPC or relevant department of the NPCSC to solicit their views before the final draft is submitted to the SPC judicial (adjudication) committee. Additional relevant guidance cited in my chapter reminds drafters that “liaison with the NPCSC LAC must be timely, and after major revisions to the judicial interpretation draft after consulting with the NPC LAC, the view of the NPCSC LAC  should be solicited again.”  Therefore the views of the two institutions are harmonized before the judicial interpretation is finalized by judicial committee approval.

Broad Consultation of Opinions

As I wrote in my recent book chapter, discussions of draft judicial interpretations by specialists are a regular part of the SPC’s judicial interpretation drafting process.  I described this as “broad consultation outside the gated community.”  The reason workshops are organized is to solicit the views of experts on specialized or technical subject matter. Those invited for these meetings tend to be senior academics, either from the country’s major universities or CASS, as was the case here.

The workshop was held at Renmin University, while a second similar workshop was held at CASS.  Participants included experts from the NPC LAC,  Renmin, Peking and Tsinghua Universities, China University of Political Science and Law,  China Academy of Social Sciences, Jilin University, Beijing Institute of Technology, Central University of Finance and Economics, University of International Business and Economics among others.

The normal practice is for SPC drafters to assess the views given by those experts at the workshops and consider whether they should be adopted or further taken into consideration. Professor Wang Liming, who is a member of the China International Commercial Court expert committee, was one of the leaders who spoke.

It can be determined from the workshop report which personnel at the SPC were involved in drafting and what the issues are.  As to personnel, Justice Liu Guixiang spoke at the beginning of the workshop, which means he is the most senior SPC judge responsible for the draft interpretation. Justice Liu is a full-time member of the judicial committee with vice-ministerial rank. Others from the SPC who spoke included Judge Guo Feng, deputy head of the Research Office,  Chen Longye, head of the civil section of the Research Office, Jiang Jiadi, a staff member of the same section, Judge Lin Wenxue, head of the #2 Civil Division (responsible for domestic commercial issues) and Judge Zeng Hongwei, a judge in the #2 Civil Division.  The #2 Civil Division hears appeals and retrials (再审) (and applications for retrial), unlike the Research Office, and therefore sees first hand some of the issues arising in the lower courts.  I surmise that Chen, Jiang and Zeng are the ones who are shouldering the bulk of the drafting work.  Judges Guo and Lin would have many other responsibilities.  The persons primarily involved in drafting discussed their parts of the interpretation.

Preview of the Interpretation

The first chapter of the draft interpretation is “General Provisions,” in which Chen Longye of the Research Office took the lead.  Judge Zeng Hongwei took the lead in discussing the second chapter on contract establishment. Issues included:

  •  contract interpretation;
  • trade practices;
  • application of non-contractual obligations;
  •  contract formation;
  • contract terms;
  • form of the contract; and
  • agency contracts,

Chapters 3 and 4 of the draft relate to the validity of and the performance of contract. Also, the #2 Civil Division took the lead in drafting because Judges Lin Wenxue and  Zeng Hongwei spoke.  From the discussion, it appears that the controversial questions were the oldies but goodies, the ones that occur in practice:

  • contract validity and  the obligation to report for approval;
  • defective contracts;
  • contracts in violation of mandatory provisions;
  • consequences of validity;
  • signing related issues, involving corporate seals and individual fingerprints;
  •  debtor’s right of defense in the transfer of creditor’s rights;
  • repayment of debts, debts by shares, joint debts, indivisible debts;
  • contract performance by a third party or to a third party or repayment by a third party;
  • Repayment by third parties; and
  • changes in circumstances.

Chapters 5 and 6 concern preservation of contract (保全), contract modification and transfer.  Judge Guo Feng and Jiang Jiadi of the  Research Office took the lead.  Issues included:

  • scope of rights,
  • scope of rights exclusive to the debtor
  •  right of subrogation
  • right of cancellation in “contract preservation;”
  • Contract modification and transfer;
  • role of a third party in the litigation of the creditor’s rights and debt transfer disputes,

Chapters 7 and 8 relate to  “Termination of Contract Rights and Obligations, Liability for Breach of Contract”.   Chen Longye took the lead in discussing the following issues, among others:

  • liability for compensation for contractual obligations after the breach;
  •  termination and its consequences;
  • the timing of termination;
  • determination of losses due to breach of contract;
  • liquidated damages, deposits, delay in receipt; and
  • force majeure.

When will the Interpretation be Issued?

As to whether this judicial interpretation will be issued by the end of this year, I personally have my doubts.  I have not found any reports of discussion of this draft in the lower courts or with the NPCSC LAC.  These steps are a usual part of judicial interpretation drafting.  Contract law is fundamental to business.  Those in SPC leadership are unlikely to approve this interpretation unless they think it meets the target of dealing with the unclear issues that lower courts and practitioners frequently encounter in practice.  The scope of consultation is unknown, such as whether some lawyers or companies will be consulted, or whether the entire draft will be issued for public comment. It is also unknown whether selected foreign contract law specialists have or will be approached for their comments.  We have to wait for further developments.

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Many thanks to certain anonymous readers for their insightful comments on earlier versions of this blogpost. They are not responsible for any errors or “erroneous views.”

Why I Research China’s Supreme People’s Court

I was honored to be invited by the New York University School of Law’s U.S. Asia Law Institute to contribute a short essay to their Perspectives blog, entitled Why I Research China’s Supreme People’s Court

 Many thanks to those involved in the entire process, including those who commented on earlier drafts!

What’s on the Supreme People’s Court’s financial law agenda?

Justice Liu Guixiang Speaking

This year, the Supreme People’s Court (SPC) has not released its judicial interpretation agenda to the general public, so observers concerned about what the SPC is doing in specific areas of law must be attentive to what SPC leaders mention in either speeches in major conferences or articles in the media.  Justice Liu Guixiang, a member of the judicial committee with deputy ministerial status, spoke in early September at the 4th Annual  Conference on Serving Small and Medium Sized Investors .  His speech was one of many leader’s speeches  (visible in the link领导人讲话) delivered at this conference sponsored by the China Association for Public Companies, Securities Association of China and other securities industry associations. (For the careful listener (or reader) his speech provides insights on what can be expected from the SPC in the near future in the area of financial law.  It is linked to  China’s development of its securities market and dealing with the increasing number of financial fraud cases and civil disputes. Some of what he told the audience illustrate, in the area of financial and securities law,  how the SPC operates in the New Era.  Those include:

  1. the SPC plans to issue a new conference summary on financial trials (金融审判座谈会纪要) before the end of the year, to unify trial standards. This is linked to government policies on the prevention and resolution of financial risks;
  2. the SPC plans to amend the 2003 interpretation
    Some Provisions of the Supreme People’s Court on Trying Cases of Civil Compensation Arising from False Statement in Securities Market, as it is outdated, particularly the requirement of an administrative penalty before investors can file suit. The interpretation is inconsistent with the amended Securities Law;
  3. the SPC will guide the lower courts on the hearing of securities group cases  (证券集体诉讼制度), particularly focusing on financial fraud, providing better relief to investors, and assisting to stabilize the market in its transition to a registration based listing system.  He stressed that the SPC would require lower courts to apply the principle of harmonizing standards for fault and administrative penalties in financial fraud cases, distinguishing different types of fault, and “striking hard” in cases of intentional financial fraud (要求人民法院在处理财务造假等案件中,基于“过错与处罚相一致”原则,区分过错类型,依法严厉打击故意造假行为过错与处罚相一致);
  4.  The SPC will provide guidance to the local courts on strictly applying new rules (in the Civil Code and the SPC’s judicial interpretation) on guarantees provided by listed companies and will also provide further guidance on the bankruptcy (and reorganization ) of listed companies.  
  5. The SPC will cooperate further with relevant government organs and other institutions to further develop non-litigation solutions to securities disputes. One example Justice Liu likely had in mind was the recently promulgated notice jointly issued by the General Office of the SPC and the China Securities Regulatory Commission (CSRC) on establishing an online system for linking the CSRC’s electronic platform with the SPC’s mediation electronic platform, to enable mediated settlements within the securities and future mediation systems to become enforceable through judicial confirmation online (在线申请司法确认或出具调解书等诉调对接工作) This August 2021 document is entitled Notice on Establishing a Linkage Between Mediation and Litigation “General to General” Online Securities and Futures Disputes Mechanism  最高人民法院办公厅 中国证券监督管理委员会办公厅关于建立“总对总”证券期货纠纷在线诉调对接机制的通知.  That document, which implements the Party Center’s concept — social governance pattern of co-construction, co-governance and sharing (建立共建共治共享社会治理格局)includes a joint meeting system between the two institutions and affiliated organizations, with the CSRC’s Investor Protection Bureau and the China Securities Small and Medium Investor Service Center Co., Ltd. taking an important part. The linkage between mediation and litigation is part of diversified dispute resolution. It calls for analogous linkage at the local level between offices of the CSRC and the courts. The SPC has issued other documents previously,  particularly the Supreme People’s Court and the China Securities Regulatory Commission of Issuing Opinions on Comprehensively Advancing Establishment of Diversified Resolution Mechanism of Securities and Futures Disputes. The SPC’s 2021  bilingual report on its diversified dispute resolution reforms (2015-2020) provides more details on this and other reforms.
  6. Finally, Justice Liu called for promoting the securities representative litigation mechanism (mentioned in Article 95 of the Securities Law and further developed in a 2020 judicial interpretation, Provisions of the Supreme People’s Court on Several Issues Concerning Representative Actions Arising from Securities Disputes). The Shanghai Financial Court has taken the lead in these cases. What Justice Liu means is using the results in representative litigation to resolve outside of the courts other similar securities & futures disputes, particularly group disputes. This is an example of implementing the SPC’s diversified dispute resolution policies. This mechanism is can also be characterized as linking to the Party Center’s current policy of mediating first and resolving disputes at their source to reduce the quantity of litigation  (党中央关于“将非诉讼纠纷解决机制挺在前面,从源头上减少诉讼增量), as discussed in greater detail in the bilingual report.

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Those with more specialized knowledge in Chinese securities law should provide corrections or comments by using the blog’s comment function.

The 996 typical cases

Document heading for the 996 typical cases

On 26 August 2021, the Ministry of Human Resources and Social Security (MHRSS) along with the Supreme People’s Court (SPC) issued a second set of typical (典型 model/exemplary cases). As I have explained before, these are summaries or edited versions of cases, not original labor arbitration or court decisions. These are on overtime labor and personnel disputes (人力资源社会保障部、最高人民法院联合发布超时加班劳动人事争议典型案例) that I’ll call the “996 typical cases,” a central level institutional response to the widespread use of 996 overtime work in the technology sector and elsewhere. The cases themselves are entitled “the second set of typical personnel and labor disputes cases (劳动人事争议典型案例(第二批). The version that the SPC published on its two websites (court.gov.cn and chinacourt.org) lacks the document headers that accompanied the release of the cases. That version had the mutually agreed statement about the cases (joint statement) and the cases themselves. Thankfully for this analysis, the Inner Mongolian Higher People’s Court released a version that includes the headers. The comments below focus not on the rules embedded in the typical cases, but on the SPC’s use of typical (model or exemplary) cases.  These cases are:

  • a product of institutional joint cooperation, as memorialized in a 2017 document mentioned in the joint statement;
  • a typical use of typical cases in the New Era; and
  • Used by the labor arbitration tribunals under the MHRSS system and the courts to unify legal standards.

Institutional joint cooperation

The 996 typical cases are a product of cooperation between the MHRSS and the SPC, as memorialized in the policy documentOpinions of the MHRSS and the SPC on Strengthening the Building of a Mechanism of Connection between Arbitration and Litigation of Labor and Personnel Disputes,  (No. 70, MHRSS)(《关于加强劳动人事争议仲裁与诉讼衔接机制建设的意见》(人社部发〔2017〕70号).  Two quick comments on the cooperation are as follows.

  1. More such cooperation can be predicted in general.  Greater cooperation between the SPC and other government and Party departments is a feature of the New Era, as I mentioned earlier this year. Coordination with other central Party and state organs is a customary function of the SPC that is being repurposed, in part, in the New Era. Coordination with other central organs appears to be an increasingly important part of New Era governance.  Therefore, the statement accompanying the cases stated the following:

In recent years, the MHRSS and the SPC have actively guided the implementation of the “Opinions on Strengthening the Construction of a Cohesive Mechanism for Labor and Personnel Dispute Arbitration and Litigation” , and the cohesion mechanism for adjudication and adjudication has been realized… In the next step, the two departments will continue to jointly develop guidelines, publish cases, and strengthen information comparison, and continue to promote the convergence of adjudication procedures and the unification of the application of law, so as to better achieve an efficient and orderly connection between arbitration and justice, and realize labor disputes. The dispute resolution is an organic unity of political, legal and social effects.

2.  As can be seen from the statement above, we can expect further cooperation between the MHRSS and the SPC in the form of joint guidelines, more typical cases, and information sharing.  All of these are flagged in the 2017 Opinion mentioned above.

What we can see from the document numbers of the 2017 Opinion, the first set of joint typical labor cases and the 996 typical cases is that they all have an MHRSS document number.  (See analysis of the first set of cases here.)That means both the Opinion and the typical cases are an initiative of the MHRSS that required concurrence by the SPC. The Opinion  sets out the agreement between the two institutions:

The departments of HRSS shall positively and voluntarily strengthen communication and coordination with the people’s courts. The people’s courts shall specify that a tribunal [division] or office [庭室] is uniformly responsible.

So we can see from this language that at each level of court, a division (tribunal) or office (likely to be the Research Office) is responsible for liaising with the HRSS authorities.  At the level of the SPC, it is understood to be the Civil Division #1, which is responsible for labor-related issues among many other civil law issues, and within that division, a group of people (likely judges with special competence in labor issues) was involved with liaising with the MHRSS to agree upon a draft version of the statement and the typical cases.  Given the administrative nature of the SPC and previous practice, it seems likely that what was agreed upon at the staff level was reviewed by the head or deputy head of the Civil Division #1 and approved by the SPC vice president in charge of the Civil Division #1. It is likely the cases were cleared at an analogous senior level at MHRSS as well.

As to why these particular cases, it is likely that they are scenarios that regularly occur in the labor arbitration tribunals and the courts, but where decisions are inconsistent because the law is unclear.

Use of Typical Cases in the New Era

The release of the 996 typical cases is a typical use of typical cases in the New Era.  As discussed in further detail last year,  this is part of popularization of law (普法教育), an old development repurposed in the post 4th Plenum of the 19th Party Congress New Era. I first wrote about typical cases in 1993:

 

 

The release of these 996 typical cases is linked to the popularization of law responsibility system set out in this document: General Offices of the Party Central Committee and State Council Opinions on a Popularization of Law Responsibility System of State Organs Regarding “whoever enforces that law, explains the law.” (中共中央办厅 国务院办公厅印发《关于实行国家机关“谁执法谁普法”普法责任制的意见》Section 6 calls for judge, procurators, administrative enforcement personnel, and lawyers to establish a “using cases to explain the law” system.

Therefore MHRSS personnel are encouraged to use cases to explain the law, and the 2017 Opinion encourages MHRSS personnel to cooperate with the SPC in doing so. The message to the general public as set out in the joint statement is:

On the one hand, it reminds employers of the risks of illegal activities and promotes the regulation of labor according to law; on the other hand, it clarifies the expectations of workers’ rights protection and guides workers to protect their rights in a rational way.

Releasing these cases also hits another target for those involved: fulfilling their obligations under the current Party history study and education campaign: “I do real things for the masses”(“我为群众办实事,” therefore in the first sentence of the joint statement).

 996 Typical Cases Used to Unify Legal Standards

What the SPC’s version of the 996 typical cases omitted (likely unintentionally) is guidance from the two institutions on how the 996 typical cases are to be used:  “local [labor] arbitration agencies and people’s courts,  shall refer to it in handling cases.”

Last year’s guidance on case searches clarifies that the lower courts must search  SPC typical cases when doing a similar case search and that these cases are not binding, but for reference, or quite persuasive. These cases will provide guidance to both labor institutions and courts, providing a more unified standard on these overtime issues.  It will also indirectly pressure employers to amend their labor handbooks and change other labor practices to be consistent with these cases.

Concluding thoughts

These cases are not expected to completely resolve the overwork culture in Chinese companies. They are intended to set a clearer standard for the labor arbitration commissions and courts to apply (and lawyers or other advocates to meet), as well as to reduce the number of cases in which courts overturn labor arbitration commission determinations related to overtime and overwork. They also provide societal guidance (社会导向)by providing a timely signal to companies and Chinese society on these issues. They also evidence that the SPC is “strengthening judicial safeguards of people’s livelihood” (加强民生司法保障). Most importantly it shows that the MHRSS and the SPC are doing “real things for the masses.”

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Many thanks to those who commented on an earlier version of this blogpost.

A blog discussing China's highest court