A brief notice appeared on the China International Commercial Court (CICC)’s websites on 9 August, announcing that the Office of the International Commercial Expert Committee (Expert Committee) of the Supreme People’s Court (SPC) (国际商事专家委员会办公室) had been renamed the Coordination and Guidance Office (协调指导办公室) for the CICC from 21st June 2019. The main duties of the Office are described as directing and coordinating construction, adjudication management and external exchange (负责指导协调国际商事法庭建设、审判管理、对外交流; 负责国际商事专家委员日常工作等) of the CICC, and also in charge of the routine work of members of the Expert Committee. I surmise that these functions are meant to convey that the office will not only support activities related to the Expert Committee but also be responsible for a variety of matters, such as coordinating the drafting of rules and the wide variety of administrative matters that go along with any administrative entity in China, particularly one that deals with foreigners. The notice also announced that from 23rd July 2019, Ms. Long Fei, who has a Ph.D. from China University of Political Science and Law, has been appointed as the Deputy Director (Person in Charge) of the Coordination and Guidance Office. She had formerly been the Director of Department of Guidance Service, Judicial Reform Office of the SPC. She brings to the new role many years of work on diversified dispute resolution related issues.
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As I described in a detailed blogpost last December (2018), the SPC intends to increase judicial transparency. However, that does not yet extend to the gender ratio of judges at the SPC. In a recent academic article, I discussed transparency concerning information on the number of judges in a court, including the SPC (excerpted below).
The SPC has been relatively late in expanding transparency concerning its own judges for reasons explored below. Information concerning the number of judges on the SPC was not readily available until July, 2017, when reports on the implementation of the quota judge system in the Supreme People’s Court revealed that there had been 642 judges,with 367 judges designated as quota [员额制] judges. The SPC does not list the number of contract staff or other support staff on its website. When the circuit courts were established, the SPC began to publish basic information concerning all judges. Some commentators suggest that the sensitivity concerning releasing data about the number of SPC judges may relate in part to the connection with the death penalty, because releasing this information would give an indication of the number of judges engaged in death penalty reviews and possibly to the number of annual executions. Another concern that has been mooted was that minimising the transparency of information related to SPC judges would reduce media focus on the resignation of judges from the SPC.
As to the number of judges in lower courts, that appears to be increasingly transparent, as many courts begin to list the number of personnel on their staff. For example, the website of one of the Shenzhen district courts states: ‘The court has a total of 629 people on staff, among which 391 are permanent staff (including 282 political-legal staff, 109 ordinary staff); contract staff 238, 160 judges; 51 judges with graduate training, 104 university graduates;
98.1% of the judges are university graduates or above’. Corresponding information is not yet available on the SPC website.
As I discussed in an earlier blogpost, not all of the professional staff at the SPC is permanently employed by the SPC, as the SPC compensates for headcount limits imposed by the Central Staffing Commission (another institution that awaits clear exposition in English) by borrowing staff from the lower courts. Lower courts compensate for headcount limits by hiring contract support staff. (I look forward to someone setting out in clear language (Chinese or English) the way in which Chinese courts are funded in the new era).
It could be that transparency concerning the number and identities
of judges is linked to transparency developments by the Central Staffing Commission [中央机构编制委员会办公室], a Party-State organisation that regulates staffing in Party and state entities. As suggested below, the entire regulatory structure concerning court staffing, and the control of staffing of political legal
institutions does not itself appear to be very transparent.
….In 2015, the Central Staffing Commission issued a document on
reforming the treatment of political-legal staff, including judges, but the
document itself has not been made public.
So in March (connected with a presentation I gave in Beijing at Peking University’s Yenching Academy’s conference on the role of women in China), I did an informal survey. As you can see from the judges listed among SPC leaders, only Justice Tao Kaiyuan (pictured above) is a woman.
There have previously been other women SPC vice presidents, including Justice He Rong, now head of the Supervision Commission and deputy Party Secretary of Shanxi Province (apparently she has been transferred to that role on the principle of cadre rotation). Justice Huang Ermei has retired.
Some of the many reasons that the SPC has so few women in senior leadership positions is that in the first years that Chinese law schools accepted students, relatively few women studied law. Moreover, women in China face an earlier retirement age. And then there is the issue of having the correct portfolio of leadership skills for the system.
Based on my unofficial research, the civil divisions appear to be at least 50:50. The #4 Civil Division has a woman as head of the division (Judge Wang Shumei), who has replaced Judge Zhang Yongjian (apparently he will be retiring), with Judge Gao Xiaoli (also a woman, and featured in these blogposts) remaining as deputy head of the division. It appears that the SPC has an increasing number of women in deputy division head roles (apart from women academics, such as Wang Xiumei,who are working at the SPC under the guazhi program. Scholars working at the SPC under that program are designated as deputy division heads). It is understood that the trial supervision division has more women, while the administrative division has more men. The five criminal divisions are said to have more men than women. The enforcement bureau is said to have more men than women.
One informed person suggested that at least some of the reasons relate to the need to travel when working in the criminal divisions, and women having to fulfill traditional gender roles in taking care of children and the elderly. A more scholarly analysis of this issue is found here, for those with the tools to access academic articles behind paywalls.
As to future trends, most Chinese law schools have more women than men students, with some lower courts trending to 50:50 men/women judges. Recruiting judges from current judicial assistants likely to mean the gender balance moves increasingly towards more women, particularly as all studies I have seen, including one done in 2018, involving judges resigning indicate many more men leaving the judiciary than women. At the lower level there is an increasing number of women court presidents. Professor Sida Liu of the University of Toronto and two collaborators published the academic study on the feminization of the Chinese judiciary cited above and summarized here.
Former President of the Supreme People’s Court (SPC) (and former Minister of Justice) Xiao Yang passed away on 19 April 2019). His funeral was held on 22 Apri. State leaders, including Xi Jinping attended. From the photos and reports I have seen, large numbers of legal professionals attended (one report was of over 1000 attendees), including several hundred from the SPC.
I’ve seen tributes to him in articles published in Chinese social media, personal tributes by many who worked at the SPC during his term in office and a poem composed in his honor. I list below some of the articles in Chinese social media:
- 肖扬：人大法律人的家国情怀 (In this article, Xiao recalls that because his primary school teacher was hatted as a rightist, he was under suspicion and unable to join the Party until several years after graduating from Renmin University)
- 缅怀 · 致敬：政法战线的杰出领导人肖扬
- 缅怀| 肖扬谈法院、法官与司法改革
- 肖扬同志遗体在京火化 习近平李克强栗战书汪洋王沪宁赵乐际韩正王岐山等到八宝山革命公墓送别
I’d like to focus one small aspect of his work that likely won’t be considered important enough to be included in his obituaries in either the Chinese or foreign media–his vision, as SPC president, that internationalizing the education of Chinese judges would be beneficial to China. It was done because he was able to take the view at that time that learning about foreign law was beneficial:
In rule of law construction, it is not possible to close the door; copying and blindly transferring [what is done abroad] is not possible: therefore, as for foreign legal civilization, we must creatively absorb the content that conforms to the general principles of the rule of law according to our situation. In fact, a considerable part of our rule of law construction achievements in the past 40 years have been achieved on the basis of absorbing foreign advanced experience. When we formulated the General Principles of Civil Law, the Contract Law, the Property Law, and even the General Principles of Civil Law, we absorbed a lot of advanced concepts and systems from the civil law system and even the Anglo-American legal system. The principle of crime established in the Criminal Law of 1997 is also modern, contains commonalities with the modern rule of law.搞法治建设，关起门来不行，照搬照抄也不行；因此，对外国法律文明，我们要根据自身情况创造性地吸收借鉴那些符合法治一般规律的内容。事实上，四十年来我们的法治建设成就，有相当一部分是在吸收借鉴外国先进经验的基础上取得的。我们制定民法通则、合同法、物权法乃至民法总则时，就大量吸收了大陆法系甚至是英美法系的先进理念和制度；我们在1997年《刑法》中确立的罪刑法定原则，也正是现代法治中共通性的内容。[please feel free to make corrections to this translation]
He considered sending judges abroad an accomplishment that should be included in reports to the NPC:
- More than 200 outstanding young and middle-aged judges have been selected from the national courts to study abroad and in the Hong Kong Special Administrative Region. More than 100 people have returned from their studies and become the backbone of foreign-related trial operations. (从全国法院选送200多名优秀中青年法官到国外和香港特别行政区进修深造，目前已有百余人学成归来，并成为涉外审判业务骨干.)（2002）
- Continue to organize judges to study and exchange in the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and abroad.(继续组织法官到香港特别行政区、澳门特别行政区以及国外学习交流。)
It is hard to calculate the number of judges at either the SPC or from the lower courts who studied abroad in degree or long-term training programs when Xiao Yang was SPC president. They do include the CICC judges:
- Gao Xiaoli:
- Xi Xiangyang;
- Song Jianli;
- Ding Guangyu;
- Shen Hongyu.
But the number of SPC judges who studied abroad during the Xiao Yang era is not limited to that handful and all who remain at the SPC are considered “backbone cadres” (骨干) (core staff).
Another group of now senior SPC and lower court judges are graduates of LLM programs that are cooperative arrangements between Chinese and foreign universities, such as that between Temple University and Tsinghua. On the Temple University program, in 2002 former Dean Reinstein testified:
We were originally approached in 1995 by the Ministry of Justice and a
national law school, the China University of Political Science
and Law. They wanted us to consider starting a Masters of Law
Program in Beijing for Chinese lawyers to learn about American
and international law along the lines of a program that we had
already developed in Japan. They said they needed this because
with the development of a market economy in China, they
understood the need to develop a legal system. The route they
wanted to take in developing a legal system was to educate a
core of very highly trained lawyers and government officials
who would learn about the American legal system and
international law and other Western legal systems and adopt
what they thought was appropriate, from that education, and use
that to develop their legal system.
When we started to develop the program, we began to receive
requests from the Supreme People’s Court, and a number of
government ministries to send students. We did start our first
class in 1999 with 35 students, that class included 8 judges
who had been sent by the Supreme Judicial Court, they had
actually nominated 18, we only had scholarship funding for 8.
Many of the ongoing exchange or training programs involving the Chinese judiciary and educational institutions abroad date from the Xiao Yang era, such as the degree programs between the National Judges College and the City University of Hong Kong and the National Judges College and the University of Montreal and it is understood that few students in the Tsinghua/Temple University program are now from the judiciary.
The Supreme People’s Court (SPC) is gradually building the infrastructure for the China International Commercial Court (CICC). An important part of it was put into place in December 2018, when the SPC issued the Procedural Rules for the China International Commercial Court of the Supreme People’s Court (For Trial Implementation) (CICC Procedural Rules). Other rules are yet to be issued. From the Chinese original of the CICC Procedural Rules, they were issued by the SPC’s General Office 最高人民法院办公厅关于印发《最高人民法院国际商事法庭程序规则（试行）》的通知 (document number (法办发〔2018〕13号). The SPC’s judicial committee discussed the draft CICC Procedural Rules in late October, indicating the importance that the SPC leadership attaches to the CICC. However, the SPC did not issue the CICC Procedural Rules as a judicial interpretation.
As to why they were issued with the indication “For Trial Implementation” and by the SPC’s General Office rather than as a judicial interpretation, the Monitor has her theories (readers are welcome to propose alternative explanations). As for why “For Trial Implementation,” it is likely that the SPC intends to further amend the CICC Procedural Rules once it has greater experience using the rules and has more reaction from counsel that has litigated before the CICC and the market generally. As to why the SPC issued the CICC Procedural Rules as a General Office normative document rather than a judicial interpretation, it may be surmised that it is linked to the SPC practice of issuing judicial interpretations when judicial policy has stabilized (this practice is discussed in another article in the academic article production pipeline), and the judicial interpretation can be in place for a relatively long period. Additionally, issuing the CICC Procedural Rules as a judicial interpretation would involve more formalities and scrutiny under the 2007 SPC rules on judicial interpretation work.
As this blog (and other commentators have mentioned), the drafters of the China International Commercial Court rules had to draft carefully to remain within the constraints of existing law and judicial interpretations, as judicial normative documents (司法规范性文件) of which this is an example, may not conflict with either source of law. The CICC Procedural Rules reflect a number of themes seen in SPC cross-border matters:
- a focus on efficient dispute resolution;
- institutional rather than individual judge orientation;
- interaction with mediation and arbitration (as part of the SPC‘s Diversified Dispute Resolution policy);
- on-line procedures (part of the SPC’s intelligent (smart) courts project);
- promoting the use of Chinese institutions (part of the push to move the locus of China-related (and Belt & Road) dispute resolution to China (as mentioned earlier)); and
- reference to beneficial experience in other jurisdictions.
As noted here also, The CICC Procedural Rules are not long (40 articles), with one-quarter of its provisions devoted to mediation. In comparison, the DIFC court rules. Singapore International Commercial Court (SICC) Practice Directions, and Netherlands Commercial Court Rules of Procedure are much longer. But the length of the CICC Procedural Rules is consistent with the length of other SPC rules.
A few specific comments and general comments follow below.
Article 8 lists the documents that a plaintiff needs to provide when filing suit, highlighting the new and old in Chinese cross-border dispute resolution. The old is the documentary requirements that a foreign (offshore) plaintiff and his/her foreign agent must provide. Because China has not yet acceded to the Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents, an offshore plaintiff must provide notarized/certified and legalized versions of corporate or individual identification documents,
As to what is new, requiring a plaintiff to submit a Pretrial Diversionary Procedures Questionnaire (in addition to a statement of claim and other such documents) is a type of document that is often required by courts in other jurisdictions and reflects background research that the drafters had done on other jurisdictions.
The CICC emphasizes the importance of mediation and promotes the concept of a one-stop integrated model through integration with the leading foreign-related mediation organizations within China. The three international commercial court rules mentioned above also encourage the use of mediation but do not limit the mediation institution used to domestic ones.
Article 17 and 18, Pre-trial Mediation: Article 17 relates to a case management conference called by the Case Management Office of the relevant CICC rather than the judge assigned to the case, as set out the SICC Practice Directions (and other international commercial courts). The institution of a case management conference appears to be a concept borrowed from outside of China. It is to be convened within seven working days from the date of the service of the plaintiff’s documents on the defendant. In other jurisdictions, however, case management conferences are generally scheduled after the defendant has served his documents on the plaintiff. Query whether an exchange of documents would be more conducive to effective mediation.
Article 17 mentions that the time limit for mediation should generally not exceed twenty working days. This deadline puts pressure on the mediators and parties to come to an agreement quickly. It appears “generally should not exceed” language contains flexibility so that if parties are in negotiations, the deadline could be extended. As to what occurs in practice, Danny McFadden, Managing Director of the Centre for Effective Dispute Resolution (CEDR) Asia Pacific, well-known as a mediator (and trainer in mediation) )and former interim UN Director of Mediation) commented that in his experience: “When parties are keen to hold a mediation it can be administered and take place within a matter of days. However on average, from when CEDR is initially contacted by the parties/lawyers, the mediator and date of the mediation is agreed, mediation documents are exchanged and to the end of the actual mediation, it takes 5 to 6 weeks.”。
Under the CICC Procedural Rules, mediation will be conducted by one or more members of the CICC Expert Committee or one of the Chinese mediation institutions designated by the CICC. The case management conference is to be held online (assuming the videolink from the CICC will be good enough). The resulting memorandum is then issued by the Case Management Office. Under the SICC Practice Directions (and rules of some of the other international commercial courts), the case memorandum is prepared by the parties. It is not mentioned in the CICC Procedural Rules whether the parties will have an opportunity to comment on the memorandum.
The section on trial procedures primarily focuses on the pre-trial conference. Article 27 contains a long list of items that should be included in the pre-trial conference (indicating the drafters of the CICC Procedural Rules made reference to the practices of other international commercial courts.) Either the entire collegial panel or a single judge may convene the pre-trial conference, which may be held either online or in person.
Article 31 sets out the procedure under which the collegial panel can request one or more member of the International Commercial Expert Committee (Expert Committee) provide an expert opinion on international treaties, international commercial rules, or foreign law.
Trial procedures, therefore, will follow those set out in the Civil Procedure Law.
A few (and not comprehensive) general comments follow below.
Challenges for the CICC
There are no small matters in foreign affairs (外事无小事)( Zhou Enlai’s saying) –both domestically and internationally, foreign-related matters, because they involve relations with other countries and the prestige of the Chinese state, are sensitive. For the CICC judges, particularly the leaders, this imposes particular pressure to handle these disputes in a way that is acceptable to SPC leadership and to the outside world.
CICC judges have many other cases to deal with–As may be apparent from the previous blogpost on the CICC, the CICC is not a full-time job for any of the judges involved. That means that judges need to deal with possibly complex international commercial cases on a part-time basis.
Limitations of Chinese substantive law–To the extent that the CICC needs to apply Chinese substantive law, that also presents a challenge. As CICC Judge (and deputy head of the #1 Circuit Court) Zhang Yongjian mentioned almost three years ago: “there are numerous types of foreign-related cases, with many difficult cases. On the one hand, there are many legislative “blank spaces.” 涉外案件类型多样化，疑难案件层出不穷.一方面，会出现更多的立法空白.” Chinese contract law (even with related judicial interpretations) is considered by Chinese legal professionals to lack insufficient detail（see comments here, for example。
To the extent that a CICC judgment needs to be enforced outside of China, it will involve enforcement issues (previously discussed on this blog).outside of China. One important development since the blogpost is the conclusion of the Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters by the Courts of the Mainland and of the Hong Kong Special Administrative Region. Implementing legislation has not yet been promulgated in Hong Kong.
Opportunities for the CICC
Piloting new rules and procedures–The CICC also presents the SPC with opportunities to pilot new rules and procedures in cross-border cases and to make appropriate reference to foreign beneficial experience. (For the avoidance of doubt, the Monitor is not advocating that the SPC import foreign law wholesale (照搬外国法).) This earlier blogpost mentions my encounter several years ago with a senior Beijing academic who made this accusation against some SPC personnel).
One important area that would be beneficial for the CICC to focus on is discovery procedures. CICC judges are aware of US lawyers and overly broad requests for documents in discovery, but they should be able to find an appropriate solution that fits Chinese reality, perhaps using the pre-trial case management conference as a forum to require parties to provide documents and other evidence to opposing counsel. Without some sort of discovery, foreign plaintiffs may be reluctant to use the CICC as a forum.
I plan to come back to the topic of the CICC from time to time, as more information about CICC cases becomes available (and as I have my own personal experience with CICC operations),
The author is a member of the CICC’s Expert Committee but her views do not represent the committee, the CICC, or the SPC.
Although the redraft of China’s Judges Law has the potential to have an impact on many in the world outside of China, few people have taken an interest, judging by the pageviews of its translation on Chinalawtranslate.com (62). (I’m indebted to Jeremy Daum and others for translating it). Judging by a search on Wechat, the same is true in China. The workshop pictured above, organized by the China Law Society, appears to be one of the few in which views on the draft were aired. There must have been strong views on the draft, but the report did not provide any details (and it is apparent no foreigners participated). The draft was released before the Communist Party (Party) Central Committee’s 2019 Political-Legal Work Conference and therefore does not reflect the most current political signals. The draft is open for public comments until 3 February and over 800 comments have been submitted as of 25 January. An earlier draft was made available for public comment (as well as related institutions) for comment and the China Law Society organized comments on that draft as well. The current draft incorporates input from various sources.
The law, if enacted in its current form, will have short and long term implications for the Chinese judiciary. As the Chinese judiciary seeks to be increasingly connected with the outside world, through its work in negotiating the (draft) Convention on the Recognition and Enforcement of Foreign Judgments at the Hague Conference on Private International Law, the Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters between mainland China and Hong Kong, as well as other more controversial involvement, the questions it raises for outside observers (and Chinese ones as well) is–what vision does it convey of the Chinese judge? What rights and responsibilities does a Chinese judge have under this law? Will this law, if enacted in its current form, encourage competent people to remain in the judicial system and promising young people to enter it? When I first flagged the redrafting of the law in 2015, I commented–“how to reorganize the Chinese judiciary and what professional status Chinese judges should have and work under will affect how judicial reforms are implemented and less directly, more fundamental issues concerning China’s economy and society.”
Some brief (not comprehensive) comments follow:
It consolidates the framework of the old law, incorporates legislative changes and many judicial reforms, leaves some flexibility for future reforms, and reflects current Communist Party (Party) policy towards political-legal institutions and their personnel as set forth in the 2019 Party regulations on political-legal work.
The Judges Law does not stand on its own. It is connected with other legislation, such as the recently amended Civil Servants Law the amended court organizational law, and of course, relevant Party rules. The initial drafting was led by the SPC, in particular, its Political Department (as the Party is in charge of cadres).
This section with broad statements is longer than the previous version. Among the notable amendments.
Article 1, concerning the purpose of the law: “advance the regularization, specialization, and professionalization of judges; to strengthen the management of judges; to ensure that the people’s courts independently exercise the adjudication power; to ensure judges’ performance of their duties in accordance with law; to ensure judicial fairness; and to preserve the lawful rights and interests of judges”–sends signals concerning the professionalization of the Chinese judges, with principles of independence (better read as autonomy) and fairness not listed first. It should be noted that during the 2019 Political-Legal Work Conference, the “revolutionization” of political-legal teams was listed before regularization and professionalization (加快推进政法队伍革命化、正规化、专业化、职业化建设，忠诚履职尽责). (“Revolutionization” appears to meant to signal the absolute leadership of the Party.) SPC President Zhou Qiang gave a speech at a meeting to implement the spirit of that Political-Legal Work Conference which also listed “revolutionization” first, but he stressed the greater importance of professionalization (加快推进队伍革命化、正规化、专业化、职业化建设，把专业化建设摆到更加重要位置来抓) as the operation of and public confidence in the Chinese court system depends on retaining and attracting professionals. The establishment of the CICC, the Shanghai Financial Court and the Intellectual Property Court of the Supreme People’s Court all represent professionalization and specialization.
Article 2 mentions various types of judicial personnel, the functions some of which are defined in the court organizational law, but for others, such as division chiefs and deputy division chiefs, mentioned without definition. A Chinese court has many administrative characteristics, but it would be helpful for the Chinese and offshore public to flag some basic principles regarding the functions of persons with these different titles, as these are found scattered in various SPC regulations.
Article 4: Judges shall treat parties and other litigation participants justly. The law is applied equally to any all individuals and organizations. But the law treats different types of parties differently (embezzling money from a private enterprise vs. state-owned company) and other provisions of law treat cases involving senior officials differently from ordinary people (see this article on the principle of trying criminal cases involving high officials in a jurisdiction outside which the case arose).
On Judicial duties, Articles 8 and 9, on the duties of ordinary judges and ones with a title do not clarify what participating in trials and being responsible for their cases mean (the latter is linked to the 2015 responsibility system that (as this blog has mentioned), gives judges a great deal of stress. Perhaps the German Judiciary Law could be a source of inspiration on judicial duties.
This chapter incorporates a number of policy changes that have been implemented under the judicial reforms and also explains why the China International Commercial Court (CICC) will not be able to appoint foreign judges, unlike its counterparts in Singapore and Dubai.
Article 12 is a revised version of old Article 9, requiring judges to be PRC citizens, uphold the PRC constitution, and have a good political and professional character. Article 65 mentions that new judges must have passed the legal qualification examination.
This chapter mentions the establishment of Judicial Selection Committees (also a borrowing from abroad) and which must have some linkage to Party organizational departments. The chapter mentions recruiting judges from outstanding lawyers and academics (thus far, proving more difficult than anticipated), and requiring higher court judges to be recruited from those with experience in the lower courts. I described the “classic” appointment system in my 1993 article on the Supreme People’s Court, in which fresh graduates were assigned directly to the SPC. As mentioned in my earlier blogpost on the court organizational law, court presidents are required to have legal knowledge and experience.
This chapter has expanded conflict of interest rules for judges considerably. that had previously been set out in a separate chapter of the Judges Law. Some of these had mostly been contained in subsidiary rules that the SPC has issued but are now being incorporated into the Judges Law itself.
This chapter flags a number of issues, including the quota judge system, pre-career judicial training and the resignation of judges.
Article 24 states that a personnel ratio system is implemented for managing judges. This codifies the quota judge system, but it does not explain how it works and whether is any way to challenge the determination of the personnel ratio.
Article 30 provides that a uniform system of pre-career training is to be carried out for new judges. This is an innovation in which the SPC has looked to what is done in Japan and Taiwan, and was flagged several years ago in this blog. As mentioned in that earlier blogpost, training is likely to include both ideological and professional aspects.
Article 34 provides that”judge’s applications to resign shall be submitted in writing by themselves, and after approval, they are to be removed from their post in accordance with the legally-prescribed procedures.” It is unclear from this article what the procedure is for resignation and the standards for approving or rejecting a judge’s application. But it is meant to harmonize with the Civil Servants Law，2017 regulations of the Party Organization Department and two other authorities on the resignation of civil servants, and SPC regulations implementing the latter regulations (discussed here). From Wechat postings and other discussions in Chinese legal circles, it is not unusual for the senior management of a court to delay decisions on permitting a judge to leave for a year or more.
This chapter sets out the outlines of the recent judicial reforms regarding the evaluation of and disciplining of judges.
Article 45 on punishment of judges–while many of the provisions are found in many other jurisdictions, some are unique to China and could be worrisome to judges, as they could be widely construed–such as “(5) Causing errors in rulings and serious consequences through gross negligence; (6) Delaying handling cases and putting off work.” There is considerable concern among judges about the standard for “errors” in rulings because that standard may evolve over time (see this earlier blogpost) and the reason for delay may not be solely a legal one.
Articles 48-50–In contrast to the previous version of the Judges Law, this draft provides for disciplinary committees (rules to be drafted by the SPC) under which the judge will have the right to be represented and to provide evidence in his defense.
This section, on professional protections for judges, also flags the limitations on and weaknesses of those protections, with inadequate procedural protections against unfair determinations made against judges.
Article 52, providing that “Judges may not be removed from the trial post except…”–also does not provide a mechanism for judges to challenge a decision or determination made against them.
Article 64: Where there are errors in judicial sanctions or personnel dispositions, they shall be promptly corrected; where it causes reputational harm, the reputation shall be restored, the impact eliminated, and formal apologies made; where economic harm is caused, compensation shall be made. But there is no mention of how a judge can challenge the judicial sanctions or personnel disposition, or request that he (or more likely she) be reinstated. Dispassionate analysis of the responsibility system by both academics and judges (previously mentioned on this blog) describes the responsibility system as a “Sword of Damocles” hanging over the heads of judges and lists some cases in which judges were prosecuted and found not guilty, with another one reported by another Wechat account.
A final word
It is unclear at this stage of the draft whether comments on the draft will have any impact on the final draft. Presumably, some of the comments made at the workshop mentioned above will be accepted, as the participants included a group of senior experts either working within or retired from “the System” or academics whose expertise is recognized and valued.
In the last few months of 2018, the Supreme People’s Court (SPC) and China International Commercial Court (CICC) took measures to enable the CICC to start operating, although the CICC was established earlier in 2018. As SPC President Zhou Qiang reported to the National People’s Congress (NPC) in March 2018 that the CICC would be established, I expect that he will report to the NPC in March of this year that the SPC established the CICC and it has successfully begun operating. (It is likely that the National Appellate IP Court will merit a place in Zhou Qiang’s report as one of the SPC’s 2018 accomplishments, but see fellow blogger Mark Cohen (and co-authors)’s post on that development). This blogpost will summarize (and provide some commentary on) some of the recent CICC developments.
Those developments included:
- issuing rules on the international commercial expert committee;
- personnel measures–designating the heads of the of the #1 and #2 CICCs and the heads of the case management offices in the two offices and appointing seven additional judges;
- designating several (mainland) Chinese arbitration and mediation institutions to be part of its integrated one-stop dispute resolution;
- accepting several cases;
- issuing rules on CICC operations (to be discussed in a following blogpost).
Rules on the international expert committee
On December 5 the SPC General Office issued the working rules of the international commercial expert committee (expert committee) (approved by the SPC judicial committee in late October) (最高人民法院国际商事专家委员会工作规则). The date of the notice of the General Office is 21 November. It answers some frequently asked questions about the expert committee. My comments are in italics.
What do members of the expert committee do?
1) preside over mediations (Article 3 (1): This was clear from the CICC Provisions. It remains to be seen how many expert committee members will feel comfortable mediating disputes. It could be that some of the Chinese members will feel more comfortable mediating disputes than the foreign or Hong Kong-based members, as some of those members have long experience as arbitrators in China, where combining mediation and arbitration (med-arb) is usual. A significant number of expert committee members are from jurisdictions where being a mediator and mediating us regarded as separate profession and skill from arbitration and adjudicating. Articles 9-13 describe the mechanics for doing so.
(2) provide an advisory opinion on specialized legal issues such as those relating to international treaties, international commercial rules, finding and applying foreign law [foreign and greater China jurisdictions] relating cases heard by the CICC and the People’s Courts at all levels (Article 3 (2): This contains a surprising expansion of the role of the experts on the committee by authorizing Chinese courts at various levels to request an expert committee member to provide an advisory opinion on international legal, international commercial and foreign law issues. A note on terminology–the English version on the CICC website uses “foreign law” while the Chinese original uses the term “域外 ” (extraterritorial), intended to include the jurisdictions of Hong Kong, Macau, and Taiwan as well as the law of foreign jurisdictions. This blogpost will use the term “foreign law” as meaning “域外 ” extraterritorial law.
The fact that expert committee members have been so authorized indicates that ascertaining (determining) foreign law is a significant practical problem for Chinese judges. I previously mentioned in this 2017 blogpost that Judge Zhang Yongjian listed ascertaining foreign law（he uses the term 外国法·) as one of many problems confronting Chinese judges hearing cross-border issues. Several articles on the Chinese version of the CICC website (plus one on the English version (by CICC Judge Gao Xiaoli) discuss this problem. Judge Gao gently pokes fun at some Chinese scholars who fail to understand relevant judicial interpretations on ascertaining foreign law. The CICC website lists the methods available to a Chinese court in ascertaining foreign law. Among the alternatives include designating one of four authorized centers to provide an expert opinion on foreign law. Articles 14-15 describe some of the mechanics by which one or more expert committee experts can provide an advisory opinion.
Under Article 15, a litigant may request through the CICC’s Expert Office that the expert appear in court to explain his or her opinion. It is up to the expert to decide whether to appear. Presumably, expenses involved, including travel and translation, would be the responsibility of the requesting party.
The rules do not clarify a number of practical questions related to this. Could a court request an advisory opinion from an expert and from a designated discernment center, and if so, what relative weight will be attached to each? Presumably, a court would give it greater weight than an opinion from an expert provided by a party. It is unclear whether experts can charge for these services. Another concern for experts could be liability, and the standard for an opinion found to be negligently made. Additionally, for the many foreign experts on the committee who do not know Chinese, it is unclear who will be responsible for translation. Presumably, the court that requested the opinion or the International Expert Committee office (see 6 (2), which states that the office provides services to experts. Perhaps the forthcoming Code of Ethics of the Expert Members will address these questions.
(3) provide advice and suggestions on the development of the International Commercial Court; (4) provide advice and suggestions on the formulation of judicial interpretations and judicial policies of the Supreme People’s Court; (5) Other matters entrusted by the International Commercial Court; The first two provisions set out a formal structure for foreigners to provide advice, suggestions, and comments on judicial interpretations, judicial policy and other developments to the SPC, a first. Article 18 anticipates that the Expert Office will direct requests for comments or advice on specific draft judicial interpretations, policies, etc. to one or more experts, as the CICC considers useful rather than expert committee members being informed about ongoing developments. However, it does enable expert committee members to make suggestions or proposals on their own initiative.
The last few months have seen a number of CICC personnel developments, including the appointment of seven additional judges. In early November, Judge Zhang Yongjian, deputy head of the #1 Circuit Court and head of the #4 Civil Division, was appointed as head of the #1 CICC and Judge Zhang Ming, deputy head of the #6 Circuit Court, was appointed head of the #2 CICC.
Judges Xi Xiangyang and Ding Guangyu, presiding judges on the #1 and #6 Circuit Courts respectively, and CICC judges, were at the same time appointed heads of the case management offices of the two courts.
Judge Song Jianli has been appointed the head of the CICC Expert Office.
The additional seven judges are:
- Wang Shumei (deputy head of the SPC’s #4 Civil Division, specializing in maritime law);
- Wei Wenchao, who has had a number of roles at the SPC, most recently as deputy head of the #5 Circuit Court. He had previously served as deputy head of the Environmental and Natural Resources Division;
- Song Jianli, head of the Experts Office, who studied at Southampton Institute (now Solent University) (in addition to his studies in China), and was a visiting scholar at Cambridge, the University of Pennsylvania, and the Max Planck Institute of Comparative and International Law, and has primarily worked in the SPC’s #4 Civil Division;
- Zhang Xuemei, of the SPC #2 Civil Division (domestic commercial issues);
- Yu Xiaohan, also of the #4 Civil Division, and like Wang Shumei, a maritime law specialist;
- Ding Guangyu, who studied at the University of Manchester and has had a number of roles at the SPC, including at the China Institute of Applied Jurisprudence, and in the #4 Civil Division;
- Guo Zaiyu, who spent many years at the Hubei Higher People’s Court before transferring to the SPC’s #4 Civil Division.
It is clear from these announcements that at this time, the CICC is a part-time responsibility for the judges involved, who have their ongoing responsibilities at the SPC, either at one of the Circuit Courts, the new Intellectual Property Court, or SPC headquarters. And some senior people, such as Judge Zhang Yongjian, have triple administrative roles.
One-stop diversified dispute resolution mechanism
As an earlier blogpost flagged, the institutions clearly intended to be part of the one-stop diversified dispute resolution mechanism were the leading Chinese arbitration and mediation institutions handling foreign-related matters. Most of these institutions sent senior representatives to attend the first meeting of the experts committee, so I was not surprised to see the following institutions listed:
- China International Economic and Trade Arbitration Commission (CIETAC);
- Shanghai International Economic and Trade Arbitration Commission;
- the Shenzhen Court of International Arbitration (SCIA);
- Beijing Arbitration Commission;
- China Maritime Arbitration Commission;
- the Mediation Center of China Council for the Promotion of International Trade (CCPIT); and
- Shanghai Commercial Mediation Center.
SCIA has an arrangement with the Hong Kong Mediation Centre since 2014 by which Mediation Centre settlements may be enforced in mainland China through a consent award issued by SCIA.
At the end of December 2018, the CICC accepted several cases, all of which can be categorized as general international commercial disputes, with none specifically related to Belt & Road projects. The disputes include: an unjust enrichment dispute involving Fujifilm and several Chinese companies, a product liability dispute involving Italian pharmaceutical company called Bruschettini (which sells its products through Sinco Pharmaceuticals Ltd., a Hong Kong-listed company), several disputes related to Thailand’s Red Bull (from this report, I surmise that the case was referred by the Beijing Higher People’s Court), and several disputes involving the validity of arbitration clauses, including one involving China Travel Service (Hong Kong) and one of its hotels. ____________________________
The author is a member of the international commercial expert committee but her views do not represent the committee, the CICC, or the SPC.
The National People’s Congress (NPC) Standing Committee recently revised the Organic Law of the People’s Courts （People’s Courts Law, English translation available at Chinalawtranslate.com), the framework law by which the Chinese courts operate. The NPC took the lead in drafting it, rather than the Supreme People’s Court (SPC). It retains the framework of the old law, incorporates legislative changes and many judicial reforms, leaves some flexibility for future reforms, and updates some of the general principles in the old law that apparently are on the dust heap of history (历史的垃圾堆). Some of the principles newly incorporated reflect the reorientation of the Chinese courts, over the past 40 years while others represent long-term goals. Some provisions originally in earlier drafts have been deleted because the NPC Constitution and Law Committee considered that the time was not ripe for incorporating them.
The law contains some oddities, such as using two terms for judges, both “审判员” (shenpanyuan) (used four times) and “法官” (faguan)(used 38 times). None of the official commentary has explained the reason for the mixed terminology. My own guess is that it is linked to the use of “审判员” in the Constitution, but anyone with more insights into this is welcome to provide clarity.
The People’s Courts Law does not stand on its own. It is connected with other legislation, such as the Judges’ Law (amendments under consideration, with the drafting led by the SPC (this 2017 article criticizes some of the disconnects between the two) .the three procedure laws, the Civil Servants Law, as well as with Communist Party (Party) regulations. As the courts are led by the Party, its regulations also affect how the amended People’s Courts Law will operate when it becomes effective on 1 January 2019.
Some of the principles newly incorporated into the law reflect the reorientation of the Chinese courts over the past 40 years towards more civil disputes and an increasing number of administrative disputes, while others represent long-term goals.
Article 2 has relegated some of the dated language from what was previously Article 3 to the dust heap of history–references to the “system of the dictatorship of the proletariat,” “socialist property,” and the “smooth progress of the socialist revolution”). Those have been replaced by language such as “ensuring the innocent are not prosecuted,” “protecting the lawful rights and interests of individuals and organizations,” preserving national security and social order, social fairness and justice, and the uniformity, dignity, and authority of the state’s legal system.
The principle of “ensuring the innocent are not prosecuted” makes its first appearance in the People’s Courts Law. I recommend this new article by a member of the Beijing Procuratorate, (in part) criticizing the poisonous effect of the “declared innocent” performance indicators of procurators on Chinese criminal justice.
On protecting the “lawful interests of individuals and organizations,” rapidly changing judicial policy and inconsistencies between criminal and civil law may mean that what is recognized as valid under civil law may be considered a bribe under criminal law. Additionally, although the People’s Courts Law deletes language that distinguishes among owners of different types of Chinese companies, Chinese criminal law still does (see this chart setting out sentencing guidelines, for example).
Article 6, on judicial fairness, contains language on respecting and protecting human rights. Foreigners may think it is directed at them, but it is more likely aimed at Chinese citizens.
Article 7 calls for the courts to carry out judicial openness, except as otherwise provided by law. It is generally recognized that the courts are much more transparent than before, although specialist analysis in and out of China points out that there remains much to be done.
Article 8 incorporates judicial responsibility systems into the law (a prominent feature of the recent judicial reforms), described by two judges as the “sword of Damocles hanging over judges” (( 法官办案责任追究是时刻悬挂在法官们头上的“达摩克利斯之剑”) and a topic regarding which more dispassionate analysis is making its way into print.
Article 11 has important language about the right of the masses (i.e. ordinary people, that term is alive and well) to know of (知情), participate in (参与·), and supervise the courts (according to law). However, the devil is in the details, as procedures for exercising these rights remain limited and sometimes lacking.
Organization (set up and authority) of the courts
Article 15 mentions some of the specialized courts that have been established over the last thirty years:
- Maritime courts, legislation found here; translation of SPC regulations on jurisdiction found here.
- Intellectual property courts, legislation found here, a summary of SPC regulations on jurisdiction found here.
- Financial courts, see the SPC’s regulations on the Shanghai financial court.
- The military courts still lack their own legislation (an earlier discussion of this issue is found here).
Article 14 relates to the special Xinjiang Construction & Production Corps (Bingtuan) courts (not a specialized court under Chinese law, rather a court with its own special jurisdiction). Those interested can look to its NPC Standing Committee legislation, SPC more detailed regulations, and Professor Pittman Potter’s research on these courts.
Article 16 incorporates the new China International Commercial Court’s first instance cases.
Article 18 incorporates the guiding case system into the law.
Article 19 crystallizes the SPC’s circuit courts (tribunals) into law (SPC regulations on the jurisdiction of those courts found here).
Articles 26 and 27 give courts some flexibility on their internal structure (courts in remote areas with few cases need not establish divisions, while large city courts can have multiple specialized ones. (Earlier blogposts have mentioned establishing bankruptcy divisions, for example.) Article 27 also mentions establishing (or not) comprehensive divisions (the administrative departments of courts, that according to a recent academic article can constitute close to half the headcount in a court and that some court leaders value more highly than operational divisions (the divisions hearing cases).
This section of the law incorporates the current judicial reforms in several ways, including:
- In Article 30, on the operation of collegial panels and requiring the court president to be the presiding judge when s(he) participates in a collegial panel;
- Mentioning in Article 31 that dissenting opinions are to be recorded and that members of the collegial panel (or sole judge) are the ones to sign their judgments and the court is to issue it;
- Article 34 gives space for eliminating the role of people’s assessors to determine issues of law, linked to Article 22 of the People’s Assessors Law;
- Articles 36-39 includes new provisions on judicial/adjudication committees. It consolidates current reforms by crystalizing specialist judicial committees (civil/criminal). An important reform is requiring the views of the judicial committee to be disclosed in the judgment (the view is binding on the collegial panel that has submitted the case. These articles also include related stipulations such as quorum requirements and making judicial committee members responsible for their views and votes. (See previous scholarship on this important institution).
- Article 37 incorporates into law previous SPC regulations on judicial interpretations, specifying that they must be approved by the full (plenary) SPC judicial committee while guiding cases can be approved by a specialized committee of the SPC judicial committee.
This section of the law uses the terminology :”审判员” (shenpanyuan) and “法官” (faguan). It also incorporates the personnel reforms set out in the judicial reform documents in several ways: quota judge system; selecting higher court judges from the lower courts; the roles of judicial assistants and clerks (changed from the old model); other support personnel in the courts; a new career track for judges, including judicial selection committees; preference to hiring judges with legal qualifications;
Article 47 requires court presidents to have legal knowledge and experience. It has long been an issue that court presidents have been appointed more for their political than legal expertise. Under the Chinese court system, an effective court president requires both sets of skills.
It appears that the reform of having judges below the provincial level appointed by the provincial level is not yet in place,
Safeguards for the courts’ exercise of authority
This section of the law links with the Judges Law and the People’s Police Law (in relation to judicial police).
Article 52 gives courts the right to refuse to engage in activities that violate their legally prescribed duties (will this end the phenomenon of judges sweeping streets?);
Article 53 relates to reforms relating to enforcement of judgments (and the social credit system);
Article 56 indicates that headcount for court personnel is subject to special regulation（人民法院人员编制实行专项管理, distinct from other civil servants.
Article 58 incorporates into the law President Zhou Qiang’s focus on the informatization (including the use of the internet and big data) of the Chinese courts.
The drafting process (the explanation and other articles have the details) reflects the drafting of much Chinese legislation (further insights about the process from Jamie Horsley here). The SPC Party Group designated personnel to research specific issues and engage with the drafters. The drafting involved several years of soft consultation by the drafters of relevant Party and government authorities, plus limited public consultations. Among the central Party authorities consulted were: Central Commission for Discipline Inspection, Central Organizational Department (in charge of cadres); Central Staffing Commission (in charge of headcount); Central Political-Legal Committee. On the government side: Supreme People’s Court and Procuratorate; State Council Legislative Affairs Office; Ministry of Finance, National People’s Congress Legal Work Committee. Investigations and consultations were also done at a local level.
I am prefacing this blogpost with a statement that nothing in it (or future blogposts, for that matter) represents the Supreme People’s Court (SPC), the China International Commercial Court (CICC), or its newly established International Commercial Expert Committee (Expert Committee).
As can be seen from the above photo taken in the SPC, with President Zhou Qiang, Vice President Luo Dongchuan and others, I was among the first group of experts appointed to the CICC’s International Commercial Expert Committee. Former World Trade Organization Appellate Judge Zhang Yuejiao and I were the only two women who attended the initial meeting on 26 August. I’ll set out some comments on the Expert Committee and the initial meeting.
The Expert Committee is the first official SPC committee that includes foreigners and others from outside of mainland China, and it may be the first of its nature within the Chinese justice (司法) system. The Expert Committee was established as a way to involve foreigners in the CICC. As I wrote earlier this year, unlike Singapore or Dubai, because of the restrictions of Chinese law, the CICC could not invite foreign judges to serve on the court. Among the 32 experts appointed to the Expert Committee include many leading specialists in international arbitration and dispute resolution, including judges, arbitrators, scholars and practitioners from inside and outside China. The detailed rules on how the CICC and the Expert Committee will operate (and interact) are still being drafted. The provisions on the establishment of the CICC anticipate that the experts on the Expert Committee will be able to mediate disputes and provide opinions on foreign law, among other functions.
The initial meeting was held on a Sunday morning, likely to accommodate President Zhou Qiang’s schedule or that of the other senior officials who attended the meeting. SPC newly appointed Vice President Luo Dongchuan chaired the proceedings. Future events will reveal his relationship, if any with the CICC. He had previously headed the SPC’s #4 Civil Division and was most recently the head of Xinjiang’s Supervision Commission. The senior officials who attended from outside the SPC included Mr. Xu Hong, head of the Department of Treaties and Law of the Ministry of Foreign Affairs (MFA), several officials from the Department of Treaties and Law of the Ministry of Commerce (MOFCOM), as well as representatives from China’s major arbitration institutions. A large group of officials from the SPC also attended, seated in the row behind the experts. The CICC judges sat separately. President Zhou Qiang presented all the experts present with their letters of appointment, followed by speeches by officials from MFA and MOFCOM, and several of the most prominent experts on the Expert Committee, including Huang Jin, President of the China University of Political Science and Law, Sir William Blair, former High Court judge and judge in charge of the Commercial Court in London, and Rimsky Yuen, former Hong Kong Secretary for Justice.
The remaining two hours of the meeting consisted of brief presentations by some of the SPC judges involved and several experts, while other experts provided comments. Both Judge Zhang Yuejiao and I spoke. My brief presentation was on “the CICC: An Important Step in the Internationalization of the Chinese Courts.” I raised a few of the legal issues that I had raised in earlier blogposts. I concluded by reminding the attendees that the CICC could be a great opportunity to train a new generation of Chinese international judicial personnel, and that I was looking forward to the CICC giving a chance to some of my students at the Peking University School of Transnational Law to intern there!
The Supreme People’s Court (SPC) has a yearly plan for drafting judicial interpretations, as set out in its 2007 regulations on judicial interpretation work , analogous to the National People’s Congress (NPC) and its legislative plans. Judicial interpretations, for those new to this blog, are binding on the SPC itself and the lower courts, and fill in some of the interstices of Chinese law (further explained here).
On 10 July, the SPC’s General Office issued the document above. It sets out a list of 48 judicial interpretation projects for 2018 (with several for 2019) for which the SPC judicial committee’s had given project initiation/approval (立项) designating one or more SPC divisions/offices with primary drafting responsibility (this process to be detailed in a forthcoming article). It appears to be the first time this type of document was publicly released (please contact me with corrections). If so, it is a concrete step in increasing the SPC’s transparency (addressed in part in one of my forthcoming academic articles). The projects, deadlines, and some brief comments (some longer than others) follow below.
(“Project initiation”/”project approval” is a procedure well-known to those of us who have been involved in foreign investment projects in China, where it involves approval from the planning authorities, primarily for infrastructure projects, but is an initial procedure used by regulatory authorities of all types, Party and state. For the SPC, it reflects one of the planned economy aspects of the way it operates.
The document classifies the 48 projects into three categories:
- 2018 year-end deadline;
- 2019 half-year deadline;
- 2019 deadline.
This post will discuss the projects in the second and third categories, the ones with deadlines in 2019.
From these we can see which projects are the highest priority and where the SPC sees gaping regulatory holes need to be filled, reflecting its political-legal priorities. Often specific issues have already been on the agenda of the relevant division of the SPC for some time before they have been officially been approved by the SPC’s judicial committee.
As discussed in my previous blogpost, several of the interpretations listed for 2018 have already been issued. It is unclear which other drafts will be made public for comment, as the 2007 regulations do not require it to do so. Making this list known may put some pressure on the SPC to undertake more public consultation. Few if any interpretations in the area of criminal or criminal procedure law have been issued for public comment.
First half of 2019 deadline
- Standardizing the implementation of the death penalty (规范死刑执行). Apparently this will focus on more setting out more detailed guidelines concerning how the death penalty is implemented, linked to the Criminal Procedure Law and the SPC’s interpretations of the Criminal Procedure Law.
This article on a legal website sets out the steps in implementation and notes that parading of the persons to be executed is prohibited (although this rule seems to be ignored in too many localities). A recent scholarly article provides some detail (in Chinese). It is possible that 2008 regulations on suspension of the death penalty will be updated. Responsibility of the #1 Criminal Division. Given the sensitivity of issues related to the death penalty, it is significant that the SPC leadership decided to make this list public, given that this interpretation is on the list.
2. Judicial interpretation on harboring and assisting a criminal. These provisions occur in various parts of the Criminal Law and are also mentioned in the organized crime opinion discussed in this earlier blogpost. Drafting responsibility of the #4 Criminal Division.
3. Interpretation relating to the protection of heroes and martyrs. With the incorporation of the protection of heroes and martyrs in the Civil Code and the passage of the Heroes and Martyrs Protection Law earlier this year, drafting of a related judicial interpretation was expected. Responsibility of the #1 Civil Division.
4.Interpretation on technical investigators in litigation. Responsibility of the #3 Civil Division) (IP Division). I look forward to Mark Cohen’s further comments on this.
5. Interpretation on the recognition and enforcement of foreign court judgments. This blog flagged this development last year. Judge Shen Hongyu of the # 4 Civil Division, who wrote this article on issues related to the recognition and enforcement of foreign court judgments, is likely involved in the drafting. Drafting responsibility of the #4 Civil Division.
6. Disputes over forestry rights, apparently an area with many disputes. The Environmental and Natural Resources Division is responsible for drafting.
7.Regulations on responsible persons of administrative authorities responding to law suits, relating to new requirements in the amended Administrative Litigation Law. and the 2018 judicial interpretation of the Administrative Litigation Law. The Administrative Division is in charge of drafting.
8.Regulations on the consolidated review of normative documents in administrative cases. The Administrative Division is in charge of drafting this.
9. Regulations on the consolidated hearing of administrative and civil disputes, apparently related to item #22 in the previous blogpost. Responsibility of the Administrative Division.
10. Application of the criminal law to cases involving the organization of cheating on state examinations (linked to Amendment #9 to the Criminal Law). The Research Office is responsible for drafting.
11. Application of the criminal law to crimes involving network use and aiding persons in such crimes (cyber crimes). This article discusses some of the issues. The Research Office is responsible for drafting this.
End 2019 deadline
- Jointly with the Supreme People’s Procuratorate, Interpretation on Certain Issues Related to the Application of Law in Criminal Cases of Dereliction of Duty (II), likely updating interpretation (I) in light of the anti-corruption campaign and the establishment of the National Supervision Commission.
- Interpretation on limiting commutation during the period of the suspension of death sentences. See related research in English and Chinese. The #5 Criminal Division is responsible for this.
- Interpretation on the trial of labor disputes (V), likely dealing with some of the most pressing labor law issues facing the courts that are not covered by the preceding four interpretations or relevant legislation. The #1 Civil Division is in charge of drafting.
- Regulations on maritime labor service contracts, likely connected with China’s accession to the 2006 Maritime Labor Convention and a large number of disputes in the maritime courts involving maritime labor service contracts. The #4 Civil Division is in charge of drafting.
- Regulations on the hearing of administrative cases, likely filling in the procedural gaps in the Administrative Litigation Law and its judicial interpretation. The Administrative Division is responsible for drafting this.
- Personal information rights disputes judicial interpretation, linked to the Civil Code being drafted. Implications for individuals and entities, domestic and foreign. Responsibility of the Research Office.
- Amending (i.e. updating) the 2001 Provisions of the Supreme People’s Court on Certain Issues Concerning Application of Urging and Supervision Procedure, relating to the enforcement of payment orders by creditors. Responsibility of the Research Office.
The Supreme People’s Court (SPC) has a yearly plan for drafting judicial interpretations, as set out in its 2007 regulations on judicial interpretation work (I have not been able to locate a free translation, unfortunately), analogous to the National People’s Congress (NPC) and its legislative plans. Judicial interpretations, for those new to this blog, are binding on the SPC itself and the lower courts, and fill in some of the interstices of Chinese law (further explained here). On 10 July, the SPC’s General Office issued the document above. It sets out a list of 48 judicial interpretation projects for 2018 (with several for 2019). The document details the projects for which the SPC judicial committee had given project initiation/approval (立项), designating one or more SPC divisions/offices with primary drafting responsibility (this process to be detailed in a forthcoming article). It appears to be the first time this type of document was publicly released (please contact me with corrections). If so, it is a concrete step in increasing the SPC’s transparency (addressed in part in one of my forthcoming academic articles). The projects, deadlines, and some brief comments (some longer than others) follow below.
(“Project initiation”/”project approval” is a procedure well-known to those of us who have been involved in foreign investment projects in China, where it involves approval from the planning authorities, primarily for infrastructure projects, but is an initial procedure used by regulatory authorities of all types, Party and state. For the SPC, it reflects one of the “planned economy” aspects of the way it operates.
The document classifies the 48 projects into three categories:
- 2018 year-end deadline;
- 2019 half-year deadline;
- 2019 deadline.
From these we can see which projects are the highest priority and where the SPC sees gaping regulatory holes that need to be filled, reflecting its political-legal priorities. Often specific issues have already been on the agenda of the relevant division of the SPC for some time before they have been officially been approved by the SPC’s judicial committee.
Several of the listed interpretations have already been issued. The SPC has solicited public opinion at least one of these draft interpretations, and it is unclear which other drafts will be made public for comment, as the 2007 regulations do not require it to do so. Making this list known may put some pressure on the SPC to undertake more public consultation.
This post will discuss the projects in the first category only, with a follow-up post discussing the projects in the second and third categories.
30 projects with a 2018 year-end deadline
- Regulations on the jurisdiction of the Shanghai Financial Court. The NPC Standing Committee decision required the SPC to do so and included some broad brush principles on the new court’s jurisdiction. As the SPC has announced that the court will be inaugurated at the end of August, this is likely to be the highest priority project. The Case Filing Division is in charge.
- Regulations on pre-filing property protection provisional measures (关于办理诉前财产保全案件适用法律若干问题的解释 ), a type of pre-filing injunction. These regulations are for non-intellectual property (IP) cases, as item 18 below addresses provisional measures in IP cases (in which a great deal of interest exists in the intellectual property rights community, as these order can affect a company’s business). The Case Filing Division is in charge. These regulations could benefit from some market input.
- Interpretation with the Supreme People’s Procuratorate on the Handling of Cases of Corruption and Bribery (II), likely updating the 2016 interpretation to reflect the establishment and operation of the National Supervisory Commission and addressing issues that have arisen in practice. Issues to be covered likely include ones discussed in issued #106 of Reference to Criminal Trial (the journal of the SPC’s five criminal divisions, mentioned here) . The #3 Criminal Division is in charge of drafting, but it is likely that the supervision commission will be/is one of the institutions providing input. As I have mentioned earlier, the SPC generally does not solicit public opinion when drafting criminal law judicial interpretations.
- Judicial interpretation on the handling of criminal cases of securities and futures market manipulation. This is linked to the government’s crackdown on abuses in the financial sector (see this report on the increase in regulatory actions) and is linked to last summer’s Financial Work Conference. The #3 Criminal Division is responsible. It is likely the China Securities Regulatory Commission will provide input during the drafting process.
- Judicial interpretation on the handling of cases involving the use of non-public information for trading (Article 180 of the Criminal Law). Guiding case #61 involved this crime. It is likely that the principle from the guiding case will be incorporated into this judicial interpretation, as frequently occurs. Again linked to the crackdown on the financial sector and again, it is a task for the #3 Criminal Division.
- Judicial interpretation on the handling of underground banking (地下钱庄) cases. Large amounts of money are being whisked out of China unofficially. Linked again to the crackdown on the financial sector as well efforts to slow the outflow of funds from China, and likely the People’s Bank of Chin. Again, a task for the #3 Criminal Division.
- Interpretation on challenges to enforcement procedures in civil cases, related to the campaign to basically resolve enforcement difficulties within two to three years. Drafting this is a task for the #1 Civil Division.
- Interpretation on evidence in civil procedure. Important for lawyers and litigants, domestic and foreign. Drafting this is a task for the #1 Civil Division.
- Interpretation on civil cases involving food safety. Food safety is an area in which public interest cases are contemplated. These cases have been politically sensitive. Drafting this is a task for the #1 Civil Division.
- Interpretation on construction contracts (II). The initial interpretation dates back to 2004. These type of disputes generally involve a chain of interlocking contracts and often regulatory and labor issues. Some of the larger cases have been heard by the SPC. Drafting this is a task for the #1 Civil Division.
- Interpretation on the designation of bankruptcy administrators. Issues surrounding bankruptcy administrators have been ongoing in the bankruptcy courts, as has been discussed in earlier blogposts. Drafting this is a task for the #2 Civil Division.
- Regulations on the consolidating the bankruptcy of company affiliates, again an area where regulation is insufficient, posing issues for bankruptcy judges (as has been discussed in earlier blogposts). Drafting this is a task for the #2 Civil Division.
- Regulations on the civil and commercial cases relating to bank cards. The drafting of this interpretation has been underway for several years, with a draft issued for public comment in June. There have been a large number of disputes in the courts involving bank cards. Drafting this is a task for the #2 Civil Division.
- Interpretation on legal provisions relating to financial asset management companies acquiring, managing, and disposing of non-performing assets. The legal infrastructure related to non-performing assets is inadequate, as has been pointed out by all participants, including judges. The Shenzhen Intermediate Court has run several symposia bringing together leading experts from the market. Drafting this is a task for the #2 Civil Division.
- Interpretation on the trial of internet finance cases (civil aspects), as existing judicial interpretations inadequately address the issues facing the lower courts. Drafting this is a task for the #2 Civil Division.
- Judicial interpretation on the statute of limitations in the General Provisions of the Civil Code (just issued), which was the responsibility of the #1 and #2 Civil Divisions as well as the Research Office. The General Provisions changed the length of the statute of limitations.
- Judicial interpretation on administrative cases involving patent authorization and confirmation. It appears to be the counterpart in the patent area of a 2017 judicial interpretation relating to trademarks. I look forward to “brother blogger” Mark Cohen’s further comments on this. Drafting this is a task for the #3 Civil Division.
- As mentioned above, pre-filing injunctions in intellectual property cases (知识产权纠纷诉前行为保全案件适用法律若干问题的解释 ), a type of pre-filing injunction. There is great deal of interest in the intellectual property rights community concerning these injunctions, as these orders can affect a company’s business. I look forward to Mark Cohen’s further comments on this. Drafting this is a task for the #3 Civil Division.
- Regulations on issues relating to the International Commercial Court. Those were the responsibility of the #4 Civil Division and the interpretation was issued at the end of June. See the previous blogpost for further comments.
- Regulations on the scope of environmental and natural resources cases, with drafting responsibility placed on the Environmental and Natural Resources Division. These relate to current government efforts to improve the environment. I would anticipate that these would include provisions on cross-regional centralized jurisdiction, so that pressure from local government will be reduced. Several provinces have already introduced such guidelines.
- Interpretation on compensation for harm to the environment, also with drafting responsibility placed on the Environmental and Natural Resources Division. This is related to an end 2017 Central Committee/State Council General Office document on reforming compensation for harm to the environment. Again, Drafting responsibility with the Environmental and Natural Resources Division.
- Regulations on the trial of administrative agreements. There is a tension between the administrative and civil/commercial specialists, as reflected in the area of Public Private Partnerships (PPPs)(see this earlier blogpost). This has practical implications for both the domestic and foreign business community, as the government is seeking to expand the use of PPPs and avoid local government abuse of them. Drafting responsibility with the Administrative Division and the Ministry of Finance is likely to be providing input.
- Regulations on administrative compensation cases, drafting responsibility with the Administrative Division.
- Interpretation related to agency issues in retrial (再审) cases. With the many governance problems of Chinese companies, these issues frequently arise. Drafting responsibility with the Judicial Supervision Division.
- Interpretation on the enforcement of notarized debt instruments. Lenders often use this provision to seek more efficient enforcement. This is related to the campaign to improve enforcement as well as government policy relating to the financial sector. This research report by one of Beijing’s intermediate court shows that asset management companies are often the creditors and the large amounts of money are involved. Drafting responsibility with the Enforcement Bureau.
- Interpretation relating to the enforcement of cases involving company shareholding. Given the complexities of shareholding in China, including the frequent use of nominee arrangements, these are difficult issues for judges to deal with. See a recent presentation by one of the circuit court judges on this issue. Drafting responsibility with the Enforcement Bureau.
- Regulations on reference pricing when disposing of property. This too is related to the enforcement campaign as well as efforts to clean up the enforcement divisions of the local courts by requiring more transparent procedures.
- Interpretation on the Handling of Cases of Crimes Disturbing the Administration of Credit Cards (II), updating the SPC’s 2009 interpretation, found here. Responsibility of the Research Office, which can coordinate with criminal divisions involved as well as interested authorities such as the China Banking Regulatory Commission.
- Interpretation on cases involving both civil and criminal issues. This is a longstanding issue, and with the crackdown on the private lending sector, this has come to the fore. Among the many issues include: if the defendant is criminally prosecuted first and assets are confiscated, how can affected borrowers or other parties be compensated. Drafting responsibility with the research office, likely involving several civil and criminal divisions.
- Regulations on the implementation of the People’s Assessors Law. As the law and the follow up SPC notice are too general for courts to implement, more detailed rules are needed. The Political Department (it handles personnel related issues) and Research Office are involved in drafting.
See the next blogpost for a discussion of interpretation in the second and third categories.
At the end of June, the Supreme People’s Court (SPC) held ceremonies to mark the establishment of its international commercial tribunals (国际商事法庭)(this post will use the phrase “international commercial court,” or “CICC” as the official media are using both terms). The provisions establishing the international commercial courts went into effect on July 1. As I wrote earlier this year, political and technical requirements shaped the CICC, as will be explained below.
These (partial) comments do not set out an overview of the court, as that has already been done by several law firms (and there are likely to be more), including Zhong Lun (published on the Kluwer Arbitration blog) and Herbert Smith Freehills.
In my view, those drafting the structure of the CICC were constrained by Chinese law, the nature of the Chinese court system and related regulatory systems. Although some Chinese commentators have referred to the CICC privately as a “mini-circuit court,” the CICC incorporates innovations, some of which have not been recognized by commentators thus far and provisions from the latest round of judicial reforms. The brief judicial interpretation establishing the CICC leaves related questions unanswered, some of which I will raise below. I expect some of those questions to be gradually answered as regulations underpinning the CICC are issued.
The small team of judges and limited jurisdiction of the court are likely to mean that overall trends in Belt & Road dispute resolution are unlikely to be significantly affected by its establishment. As a court focused on international commercial issues staffed by some of China’s most knowledgeable judges in that area, the court is likely to have a positive effect on the competence of the Chinese judiciary regarding international trade and investment issues, particularly as the SPC leadership knows that the international legal community is monitoring the court’s operation. It is unclear from recent reports whether the SPC will allocate additional resources to support its operation, which to this outside observer would be a shortsighted approach to take, as even something as apparently simple as translating judgments into English (as appears to be the intention of the court) is time-consuming.
Structure of the court
From Judge Gao’s press interview earlier this year (the subject of that earlier blogpost, a full English translation of which is found on the CICC website,) it is clear that she and her other colleagues involved in drafting the judicial interpretation were well aware of international commercial courts that had been or were being established elsewhere in the world. This research was provided by the China Institute for Applied Jurisprudence, the SPC’s in-house think tank (briefly described in this earlier blogpost).
However, the political imperatives of establishing the CICC as a priority matter meant that the SPC was constrained by the realities of current Chinese law. Because judicial interpretations of the SPC cannot contravene the civil procedure, judges and other national law (National People’s Congress legislation) [and there appeared to be insufficient time and possibly appetite for promulgating legislation piloting exceptions to these provisions]. This meant that the language of the court could not be English, the procedural law had to be Chinese civil procedure law, and the judges had to be judges so qualified under current Chinese law.
Jurisdiction of the court
As has explained elsewhere, under Article 2 of its Provisions, the CICC has jurisdiction over five types of cases, three of which are rather flexible (cases under a higher people’s court jurisdiction that it applies to have the SPC hear; first instance international commercial cases that have a nationwide significant impact; any other international commercial cases that the SPC considers appropriate to be tried by the CICC). This enables the CICC to control its caseload, as the eight judges on the CICC are likely to have their existing caseload in the SPC division or circuit court in which they are working, plus major obligations in drafting judicial interpretation or analogous judicial guidance. I am personally unaware of cases in which a higher people’s court has required the SPC to hear a case within its jurisdiction (please contact me if you have such information) but it can be anticipated that a higher people’s court may prefer to rid itself of a difficult case (either legally or more likely institutionally) to avoid a mistaken decision.
Judges of the court
As has been noted elsewhere, the eight judges appointed to the CICC are all SPC judges, although Article 4 of the CICC provisions appears to permit qualified judges from the lower courts to be selected. Those provisions do not mention whether a selection committee (one of the current judicial reforms) was used to select the current CICC judges, or whether a selection committee will be used for future appointments. There are in fact experienced judges in some of the lower courts who are able to use English as a working language. However, the exigencies of needing to appoint judges in a brief period of time (and possible SPC headcount restrictions, after the SPC has cut headcount under the quota judge system) meant that all CICC judges are from the SPC. This means a number of judges are relatively junior.
The expert committee to be established (rules yet to be issued) is an innovation under Chinese court practice. Unlike many other major jurisdictions, the Chinese courts lack user committees or advisory committees. This could be a useful way of bringing international input before the Chinese courts in a formal way. although the usefulness of the institution may depend on how often the committee meets and how familiar its members are with the Chinese court system. Presumably acting as a mediator or providing an expert opinion on a matter of foreign law will be optional (further details to be revealed when those rules are issued). Some persons may prefer to provide general advice to the SPC rather than involve themselves in the specifics of a particular dispute.
Evidence before the court
The CICC will not require translations into Chinese of evidence, if the parties so agree, or require evidence to be notarlized and legalized. As I wrote previously, China has not yet acceded to the Hague Convention Abolishing the Requirement of Legalization for Foreign Public Documents, so in Chinese court litigation, notarization and legalization of documents is often required., starting when a party files suit or when a foreign party responds. It is not clear whether the CICC will require notarization and legalization of foreign party authorization of counsel. It is an innovation possible within the constraints of current law, that the CICC will consider evidence even if evidence from outside of China has not been notarized and legalized. Notarization and legalization costs time and money and a great deal of effort. It is understood that China is considering acceding to the Hague Legalization Convention.
Mediation and arbitration linking mechanism
The mechanism to link mediation, arbitration and litigation is an important part of the judicial reform measures (mentioned in this blogpost on diversified dispute resolution). Which mediation and arbitration institutions will link to the CICC are unclear (and the rules for selecting those institutions), but the policy document underpinning the CICC refers to domestic rather than foreign or greater China institutions. The Shenzhen Court of International Arbitration and Hong Kong Mediation Centre have entered into a cooperative arrangement to enable cross-border enforcement of mediation agreements, so presumably, this is a model that can be followed for Hong Kong.
The CICC provisions do not add new content on the enforcement of their judgments. As this earlier blogpost mentioned, enforcement of its own (and that of Chinese lower courts abroad) and foreign court judgments in China is on the SPC’s agenda. As I have written (and spoken about) previously, China (with SPC participation in its delegation) has been taking an actively part in negotiations on the Hague Convention on the Recognition & Enforcement of Foreign Judgments, (the link includes the draft convention) and has signed but not yet ratified the Hague Convention on the Choice of Courts Agreements.
Borrowing beneficial ideas from abroad
It appears that the drafters of the CICC provisions considered some of the practices of Frankfurt High Court International Commercial Chamber in their draft: No translation of documents which are drafted in the English language (if there is consent); witnesses can be heard in English;and extensive use of video conferencing or other electronic means.
Some outstanding questions
- Will the mediation and arbitration linking mechanism be able to link with jurisdictions outside of mainland China? Under Chinese law, preliminary measures (interim measures) such as injunctions, property or evidence preservation are not available for offshore arbitration. Will the CICC mechanism be able to change this, or will changes to current law be required, as seems more likely?
- Will difficult issues before the CICC be referred to the SPC’s judicial committee or other institutions within the SPC? As I wrote about a year ago, the SPC has adopted new judicial responsibility rules, setting out guidance under which cases heard by a collegiate panel are referred to a professional judges committee or the SPC’s judicial committee. Query whether difficult cases that have been discussed by the entire body of CICC judges will be referred further. The CICC includes several of the SPC’s most knowledgeable judges on cross-border matters (as well as the head (chief judge) and deputy heads of the #4 Civil Division, the division focusing on cross-border/international matters). These details are likely to be worked out over time.
- Will the two CICC courts have their own support staff? Will it have its own case acceptance office? Is the intention to give more work to existing staff, or will there be an increase in headcount to support the new institution? The CICC judges need resources to support their work, whether it be in translation or research assistance. If the consequence of the establishment of the CICC is to give additional work to existing personnel, it is not out of the question that someone involved may collapse from overwork. SPC President Zhou Qiang noted in his most recent report to the NPC that there have been deaths from overwork in the lower courts. Some of the Chinese courts’ most experienced and knowledgeable judges in the area of cross-border commercial law have been appointed to the court.
The establishment of the court and its English language website gives foreign outside observers a chance to monitor how a Chinese court deals with and decides commercial cases, creating even greater pressure on the SPC and a small team of its most competent international commercial judges.
In my view, the establishment of the CICC will not affect how highly sophisticated lawyers draft dispute resolution clauses for large-scale Belt & Road projects. Many of those lawyers will still draft clauses providing for offshore arbitration because of the New York Convention (and the corresponding arrangement between Hong Kong and the mainland) and some concern about Chinese arbitration institutions. I have personally found it is difficult to get an accurate grasp of what current practice is with Belt & Road related dispute resolution clauses, given the range of deals under the Belt & Road Initiative. It is difficult to predict how the CICC may change those practices. The CICC and its associated dispute resolution mechanism provide an alternative to existing dispute resolution mechanisms. Will it show itself to be a more attractive way to resolve international commercial disputes, efficient and cost-effective, while maintaining high quality? We will need to monitor how it develops.
Many thanks to those who commented on earlier drafts of this blogpost.
Susan Finder has been observing the Supreme People’s Court for over 25 years. In August 2018, she was appointed a member of the international commercial expert committee of the China International Commercial Court (CICC) of the Supreme People’s Court. All views expressed on this blog are her own and none should be attributed to the CICC or the Supreme People’s Court.
She is the Distinguished Scholar in Residence at the School of Transnational Law of Peking University (Shenzhen) and in the fall of 2015 was an Adjunct Professor with the Faculty of Law of the University of Hong Kong and is affiliated with its Centre of Chinese Law. She speaks often on Chinese legal issues (in Hong Kong, mainland China, the United States, and Europe), and works on Chinese law related consulting projects and arbitrations from time to time. Occasionally, she writes for The Diplomat, the South China Morning Post, and the Global Military Justice Reform blog. She is starting to publish articles in academic journals, where she is often cited. Her writings have also been published in China, including in several prominent Wechat public accounts. Major media that have sought her comments on Chinese legal developments include: New York Times, Wall Street Journal, The Economist, Financial Times and Reuters. Earlier in her career, she taught Chinese law and other subjects in the Law Department of the City University of Hong Kong, where she began focusing her research on the Supreme People’s Court, leading her to write the first close analysis of its operations. She then put her knowledge of Chinese law to work in the China practice group of the international law firm Freshfields, Bruckhaus Deringer and several other law firms and institutions.
She had the good fortune to study with three of the early pioneers of Chinese legal studies (in the United States): Jerome Cohen, R. Randle Edwards, and Stanley Lubman and to have many leading practitioners and legal academics among her classmates at Harvard Law School (J.D.) and Columbia Law School (LL.M).
Susan Finder speaks and reads (Mandarin) Chinese and Russian and some German.
She can be contacted through the comment function or at firstname.lastname@example.org.