Category Archives: Communist Party and the Courts

Why I Research China’s Supreme People’s Court

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

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

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

Justice Liu Guixiang Speaking

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

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People’s Court on Trying Cases of Civil Compensation Arising from False Statement in Securities Market, as it is outdated, particularly the requirement of an administrative penalty before investors can file suit.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

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

The 996 typical cases

Document heading for the 996 typical cases

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

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

Institutional joint cooperation

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

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

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

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

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

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

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

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

Use of Typical Cases in the New Era

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

 

 

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

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

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

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

 996 Typical Cases Used to Unify Legal Standards

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

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

Concluding thoughts

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

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

Integrating socialist core values into court judgments

On 18 February 2021,  the Supreme People’s Court (SPC) issued the Guiding Opinions on Deeply Promoting the Integration of  Socialist Core Values into the Analysis and Reasoning of Adjudicative Instruments (关于深入推进社会主义核心价值观融入裁判文书释法说理的指导意见 the SCV Guiding Opinion).  This Guiding Opinion is intended to guide the way SPC  and lower court judges write their court judgments and rulings (and any other judicial document issued to the public) to better incorporate the use of socialist core values and for those judgments to be better understood by the general public. 

For close observers of the SPC and the Chinese court system, the SCV Guiding Opinion came as no surprise.  That this Opinion would be issued was clear from phrases in several Party and SPC documents issued in recent years.  The SCV Guiding Opinion is important not only for what it says about the use of socialist core values in judgments and also for its guidance to judges on the analysis and reasoning in court judgments, rulings, and other documents.  

This blogpost is not intended as an extended academic analysis of socialist core values and the law, of which there are several excellent ones by Sue Trevaskes and Delia Lin.  It will address some more modest questions, such as:

  • what it says, including what it requires of SPC and lower court judges;
  • the documents linked to the SCV Guiding Opinion
  • how the SCV Guiding Opinion should be classified & whether it is binding or persuasive;
  • what a quick sampling of judgments containing socialist core values uncovers,
  • the vision of the court system portrayed by the SCV Guiding Opinion.

I have italicized my comments.

Summary of the SCV Guiding Opinion

The background for the SCV Guiding Opinion is that it is part of what is required by the Party Center to integrate socialist core values into the legal system and to promote their use in national governance.  This has been a theme in writings of Xi Jinping about the law, the Party  Plan on Building the Rule of Law in China (2020–2025), previous Party documents, and related SPC documents.  Some of those background documents are listed in a later section of this blogpost.

Article 1 provides that the underlying principles of the SCV Guiding Opinion are:

  1. a fusion of law and morality, which is linked to their fusion in traditional legal thought ( 法治与德治相结合); 
  2. people-oriented (以人民为中心), meaning that judgments should be clear to ordinary people and serve the purpose of educating them; and
  3. the organic unity of political, legal, and social effectiveness (政治效果、法律效果和社会效果有机统一 ), because by strengthening the guiding role of socialist core values it will enhance the legal, social, and rational recognition of judicial judgment.

The summary below highlights some of the principal points for Chinese judges.

Article 4 specified the types of judgments in which the use of socialist core values should be increased:

  1.  Cases involving national interests, major public interest, and widespread public concern;
  2. Cases involving epidemic prevention and control, emergency rescue and disaster relief, protection of heroes, brave actions for righteousness, legitimate defense,  and other such cases may trigger social moral evaluation;
  3. Cases involving the protection of vulnerable groups such as the elderly, women, children, and the disabled, as well as groups that have major disputes and may cause widespread concern in the society;
  4.  Cases involving public order and good customs, customs, equality of rights, ethnic religions, etc., where the parties to the litigation have major disputes and may cause widespread concern in the society;
  5. Cases involving new situations and new issues that require in-depth interpretation of legal provisions, judicial policies, etc., to guide social trends and establish value orientation;
  6. Other analogous cases.

What this means is that in cases where there is a great deal of public concern, judges should seek to use socialist core values.  Some of these, especially with national interest, major public interest, types of cases that attract Party leadership attention, or wide public concern are likely to be those in which the higher levels of the courts, or local political-legal commissions provide their views.

A significant part of the SCV Guiding Opinion contains guidance to lower court judges. I surmise that the guidance is directed towards less experienced and educated judges. My understanding is that more sophisticated judges, who are highly knowledgeable about political matters in addition to being technically highly competent, would consider the guidance unnecessary.

Articles 5-6 address judgment drafting.  These provisions relate to the  2018 SPC Guiding Opinions on Strengthening and Standardizing the Analysis and Reasoning in Adjudicative Instruments. Article 5 gives Chinese judges rules of interpretation generally in cases involving socialist core values., directing them to first look to a normative legal document (law or judicial interpretation) as the basis for judgment, the legislative intent, and supplement it with socialist core values.  Article 6 gives directions to judges in civil and commercial cases where there is no normative legal document as the direct basis for the judgment. Judges should use socialist core values ​​as the guide and custom and the most similar legal provisions as the basis for the judgment; if there is no most similar legal provision, judges should make judicial decisions in accordance with the spirit of the legislation, legislative purposes, and legal principles, and make full use of the core socialist values ​​in the judgment documents to explain the basis and reasons for the judgment.  It is this principle that has attracted dry comments from some of the legal professionals with whom I am acquainted.

Article 7 gives guidance to judges in cases involving multiple socialist core values, directing them to consider the spirit of the legislation, legal principles, provisions, and law and legal provisions to balance and select the relevant principles and values.   Article 8 directs judges to respond, if possible, orally in court, to the use of socialist core values by parties in court.

Article 13 directs judges handling cases that fall into one of the Article 4 categories, to emphasize socialist core values, in situations in which cases are discussed in professional judges committees or judicial (adjudication) committees.

Article 14 encourages socialist core values to be included in judicial training, particularly that related to the Civil Code, and Article 16 encourages competitions to find the best judgments that cite socialist core values.

Flagging the SCV Guiding Opinion

Several recent Party and SPC documents flagged the SCV Guiding Opinion.  Among them are:

  • the April 2020 Opinions of the Supreme People’s Court on Thoroughly Implementing the Spirit of the Fourth Plenum of the 19th Party Congress to Advance the Modernization of the Judicial System and Judicial Capacity– (最高人民法院关于人民法院贯彻落实党的十九届四中全会精神推进审判体系和审判能力现代化的意见)–improve and promote the in-depth integration of socialist core values ​​into the supporting mechanisms for trial and enforcement (完善推动社会主义核心价值观深度融入审判执行工作配套机制). My blogpost on that document briefly mentioned socialist core values;
  • the 2020 Plan on Building the Rule of Law in China (2020–2025), mentioned above
  • the 2019 5th Five Year Judicial Reform Plan Outline; and
  • the 4th Plenum of the 19th Party Congress.

This Guiding Opinion can be considered the progeny of the SPC’s 2015 Opinions on Cultivating and Practising Socialist Core Values at People’s Courts. 最高人民法院关于在人民法院工作中培育和践行社会主义核心价值观的若干意见, after which the SPC issued typical cases, both discussed in Sue Trevaskes’ and Delia Lin’s academic articles linked above. Their articles also discuss other related documents. As I wrote in 2018, the SPC issued a five-year plan, never made public, to incorporate socialist core values into judicial interpretations.

How to Classify the SCV Guiding Opinion

As to which basket of SPC documents the SCV Guiding Opinion should be placed, that relates to the catalog that I set out in a November 2020 blogpost on the SPC’s soft law. I classified a number of the SPC’s documents into different categories.  According to my classification, the SCV Guiding Opinion should be classified as Opinion Type 1, although the criteria I mentioned don’t fit perfectly.

As I defined it, that type of Opinion is one issued solely by the SPC, which create and transmit to the lower courts new judicial policy, update previous judicial policy, and establish new legal guidance that may be eventually crystallized in judicial interpretations and direct the lower courts, but cannot be cited in judicial judgments or rulings. They are generally linked to an important Party or state strategy or initiative. 

The SCV Guiding  Opinion is linked to an important Party and state strategy or initiative, that of promoting socialist core values. As a “guiding opinion,” it is intended to push policy forward. Article 17 of this document directs the SPC itself and lower courts to issue occasionally socialist core value-related model cases. From a quick search of recent lower court model cases, local courts have taken account of this.

Socialist Core Values in Chinese court judgments 

Chen Liang, one of my current students, sampled cases from basic level courts in various parts of China as set out in this spreadsheet. He originally found over 6000 cases that used “socialist core values.”In his research, he found three ways that courts invoke socialist core values:

  1.  elaborating a legal standard (such as Case No. 1), a trend that I had found in my own research);

In this case, the defendant (a government branch) rejected the plaintiff’s application to recognize his father, a KMT military officer, as a martyr who died in the Anti-Japanese War, and the plaintiff sued to correct this decision. The Court invoked the SCV to emphasize the importance of the recognition of someone as a martyr, and then affirmed the defendant’s strict scrutiny of the application.

2.invoking socialist core values as a way to allocate liability (such as Case No. 9); 

The plaintiff was hit by the defendant, and was in hospital. After 15 days in hospital, the doctor recommended him to leave, but he refused by claiming he had headache. Then, the plaintiff stayed in hospital for 110 days, and sued the defendant for compensation of medical fees of 110 days. When considering the exact duration to be compensated, the Court noted that the plaintiff’s action was wasting public medical resources, which was a violation of the SCV, and then confirmed that the defendant only had to compensate for the medical fees of 15 days in hospital.

3. invoking socialist core values as a way to educate people (or to promote total social welfare) (such as Case 10).

The plaintiff and defendant agreed to jointly operate a restaurant, and they had disputes during the operation. The plaintiff sued for damage. During the trial, the parties insulted with dirty words against each other. Given that, the Court asked the parties to contemplate on their behaviors considering the whole society was promoting SCV.

This use of cases to educate the public, noted in the academic articles mentioned above, also links to a more recent line of documents about which I wrote in July 2020, relating to using cases to explain the law and the popularization of law responsibility system (普法责任制). As mentioned in that blogpost, Sue Trevaskes has also written about the history of the popularization of law (pufa).

In my view, following this document, we are likely to see many more cases mentioning socialist core values, likely falling in all three categories mentioned above.

Vision of the Chinese Court System

This Guiding Opinion can be seen as a part of the “socialist core valueization” of Chinese law and the legal system, and in particular, the judiciary. It is one important piece of how the judiciary is being further transformed in the Xi Jinping era.

Article 1 is part of official legal ideology so that the drafters of this Guiding Opinion (the  SPC’s Judicial Reform Office) must incorporate those principles. The Party Center requires this to be done.   As  Sue Trevaskes and Delia Lin mentioned in their writings, as in the traditional legal state, “morality here is treated in a particular normative sense whereby claims are made about the unified nature of socialist values held by China’s rulers and the ruled.”  This long-time observer of Chinese society would question whether the moral values across Chinese society are as unified as this ideal has it. 

An aspect the drafters of this document may not have considered is  whether this approach to law and court judgments is consistent with China’s desire to promote the use of Chinese law overseas, which the SPC has promoted in its Opinion on Further Providing Judicial Services and Guarantees by the People’s Courts for the Belt and Road Initiative (BRI Opinion #2, discussed in this blogpost).  The fusion of law and morality in cases involving multinational commercial parties seems problematic. 

These principles see the public as a body to be educated, and that judgments need to further incorporate socialist core values to be better accepted by the public.  Writing judgments in language the public can understand–plain language judgments–is a worldwide concern of domestic courts, but incorporating socialist core values may or not be the way to achieve that.

As I mentioned above, a significant part of the SCV Guiding Opinion contains guidance to lower court judges. I surmise that the Judicial Reform Office decided that this guidance was needed for less experienced and educated judges in less developed parts of China. The more experienced judges, with many years of experience and training, both substantive and ideological, are unlikely to need such guidance set out in an SPC document.

The reality of Chinese society that Chinese judges face, particularly at the local level, is not the one that matches the socialist core values ideal. That can be seen from cases discussed in the Chinese professional media (and some cases that have caught Chinese media attention) about some of the difficult issues that they face when needing to incorporate socialist core values. A few of those cases could include:

cases involving the status of children whose parents are not married under the Chinese legal definition of marriage to one another. That may be gay or lesbian couples or one in which a married man fathers a child with a woman with whom he is not married;

Cases involving disputes between a gay or lesbian couple that has split over mutually-owned property; 

Cases involving the rights of single women who wish to have children without being married.

The SCV Guiding Opinion can be seen a signal of the direction towards which the Chinese courts are being guided.  The more sophisticated judges will know how to balance the above requirements with the need to issue a judgment that parties in cases that involve fundamental personal rights find acceptable.

 

 

How the Supreme People’s Court Coordinates With Other Party & State Organs

3rd meeting of the Inter-Ministerial Conference Combatting Illegal Trade in Wild Plants and Animals

A little-discussed aspect of the work of the Supreme People’s Court (SPC) is coordinating with other Party and state organs to better serve the greater situation and resolve specific policy issues.   At some point, I will set out a fuller description of this distinctive function of the SPC and its background history, but that will need to wait until I have plumbed the SPC’s past regulatory documents and conducted a more complete survey of practices in SPC divisions.   I examined one aspect of the way that the SPC coordinates with other departments in a book chapter to be published in the fall of 2021. That chapter focuses on the drafting of criminal procedure judicial interpretations. The  “never-ending” academic article that I am writing touches upon one aspect, briefly. This blogpost highlights some formal frameworks for coordination and at least some of what is involved. 

 Coordination with other central Party and state organs regarding specific legal issues is one of the unrecognized functions of the SPC. It  is hard to assess how much coordination work is done in comparison to other functions of the SPC, such as hearing cases or drafting judicial interpretations.  Because the Collection of the Supreme People’s Court’s Judicial Rules, a handbook for judges, places the principle “establish coordination mechanisms, properly resolve administrative disputes” in the section of general principles of administrative law, I surmise that coordination is a very important function of the administrative division. From my research below and discussions with knowledgeable persons,  some judges in the civil and commercial divisions are involved in work under these frameworks, and likely also the Research Office. Some issues involve multiple divisions of the SPC.

My understanding is that coordination with other central Party and state organs is a customary function of the SPC that is being repurposed, in part, in the New Era. For that reason, I surmise that more of this will take place in SPC headquarters in the future. This is based on two factors. The first is that SPC hears most commercial and administrative cases in the circuit courts. Second, coordination with other central organs appears to be an increasingly important part of New Era governance.  That was flagged in several statements of Liu Zheng, deputy head of the SPC’s Judicial Reform Office, in a February, 2021 press conference, where the SPC released its report on online mediation. Liu Zheng stated:

promote the improvement of the social governance pattern of joint construction, co-governance and sharing…(促进完善共建共治共享的社会治理格局)

In describing the accomplishments of the SPC in promoting diversified dispute resolution, he stated:

We strengthened our communication and coordination with Central departments (ministries) and commissions, we held three coordination meetings at the ministry level, and established a joint action mechanism (加强与中央部委的沟通协调,3次召开部委层面协调交流会,建立联动机制 ).

  At the central Party level, clearly coordination occurs at the level of broad policy through the Central Political Legal Commission and the Building Ping’an (peace and safe)-China Coordination Small-Group about which Li Ling wrote last year.  Other coordination occurs through leading small group offices (工作领导小组办公室).  I describe one below.  This blogpost will focus on State Council Inter-Ministerial Joint Conferences because it is through those that much of the more specific coordination occurs.  Thankfully for the researcher, State Council transparency is quite good and I found many approval documents for Inter-Ministerial Joint Conferences. From my research thus far, the SPC participates in many Inter-Ministerial Joint Conferences established by the State Council. I note that some other jurisdictions have Inter-Ministerial Council Conferences as well, not involving the judiciary. In some instances, ministries or commissions of the State Council create coordination mechanisms with the SPC, while the SPC initiates some.  Some coordination is done more formally on an as-needed basis, as Liu Zheng mentioned and that requires separate research. It is understood that within the framework of the formal structures, interaction and coordination occur at the staff level.

Leading Small Group Coordination Offices

As mentioned above, the Party Center has established some leading small group coordination offices to coordinate specific central Party and state organs policies and measures. Because of the nature of the matter, the SPC is a member. One example is the following office.

The Pursuit of Fugitive [Officials] Pursuit of Stolen Assets Working Office of the Central Anti-Corruption Coordination Leading Small Group (中央反腐败协调小组国际追逃追赃工作办公室), established in 2015, of which the SPC is a member.  The 2017 judicial interpretation on asset recovery is likely related to the SPC’s work in this group.  The SPC is involved in the yearly Skynet operation. Through this office,  the SPC  participates in related campaigns under this mechanism, such as a 2015 one against offshore companies and underground banks.

Inter-Ministerial Joint Conferences

The State Council has established many Inter-Ministerial Joint Conferences (部际联席会议), in which other Central-level ministries take the lead (牵头) and the SPC is one of many other Party and state organs involved. For those unfamiliar with Inter-Ministerial Conferences in China, the Office of the Central Staffing Commission has an authoritative explanation (amended Google translate):

The inter-ministerial joint conference  is established to negotiate and handle matters involving the responsibilities of multiple departments of the State Council. It is established with the approval of the State Council. The member units communicate in a timely manner and coordinate differing opinions. It is a work mechanism for enabling the smooth implementation of a task (responsibility). It is the highest-level joint meeting system of administrative agencies. The establishment of inter-ministerial joint conferences should be strictly controlled. For matters that can be resolved through coordination between the sponsoring department and other departments, inter-ministerial joint conferences are generally not established. The establishment of inter-ministerial joint conferences must be submitted to the State Council for approval. The lead department shall ask for instructions, clarify the name, convener, lead unit, member unit, work tasks and rules, etc., and submit it to the State Council for approval after approval by relevant departments. After the task of the inter-ministerial joint conference is completed, the lead department shall submit an application for cancellation, stating the establishment time of the inter-ministerial joint conference and the reasons for its cancellation, etc., and submit it to the State Council for approval after the approval of the member units. The newly established inter-ministerial joint conference which is led by the leading comrades of the State Council, may be entitled ” State Council… ” , and the other joint conferences are collectively referred to as ” inter-ministerial joint conferences . ” The inter-ministerial joint conference does not engrave a seal or formally issue documents. If documents must be formally issued, the name of the leading department and the seal of the leading department may be used, or the relevant member units may jointly issue a document.

SPC and Inter-Ministerial Joint Conferences

Sometimes the SPC is a founding member of an Inter-Ministerial Joint Conference. In other situations, it is recognized that the expertise of the SPC is needed and the SPC is invited to join after the Inter-Ministerial Joint Conference has been in operation for several years. Some examples are:

  1. The Inter-Ministerial Joint Conference on the Implementation of the Intellectual Property Strategy of the State Council,  headquartered at the China National Intellectual Property Administration, of which the SPC is one of many members. It is directed towards achieving the National Intellectual Property Strategy and unusually, has its own website.  A previous version was established in 2008, but that was superseded in 2016 when the State Council revamped the Inter-Ministerial Joint Conference, likely to better achieve China’s Intellectual Property Strategy.  Justice Tao Kaiyuan is designated as a member of the Joint Conference on behalf of the SPC.  The Joint Conference meets from time to time and issues an annual plan, allocating responsibilities to members according to their authority.  Among the matters allocated to the SPC in the 2020 plan is promoting three-in-one hearing of intellectual property cases and drafting a Guiding Opinion for Three-in-one Work ( 深入推进知识产权审判“三合一”工作,制定“三合一”工作指导意见。(最高人民法院). ” (For those unfamiliar with Three-in-one hearings,” they refer to integrating jurisdiction over civil, administrative and criminal intellectual property cases. It is understood that discussions occur at staff level to coordinate and promote policies. 
  2.  The Inter-Ministerial Joint Conference on Combating Illegal Plant and Wildlife Trade (打击野生动植物非法贸易部际联席会议), established in 2016. The SPC (and the Supreme People’s Procuratorate (SPP)) was invited to join the conference in  2020., which likely means that the organizer, the State Forestry Administration, did not realize that the expertise of the SPC and SPP were necessary. The SPC is one of 27 Central-level organs. It is likely that the 2020 Guiding Opinions on Punishing the Illegal Trade of Wild Animals issued by the Supreme People’s Court, the Supreme People’s Procuratorate, the Ministry of Public Security, and the Ministry of Justice is a product of this Inter-Ministerial Mechanism.
  3. The Inter-Ministerial Conference on Money Laundering (反洗钱工作部际联席会议制度).  The State Council established it in 2004.  The People’s Bank of China takes the lead. National Money Laundering Strategies are drafted under its auspices. The role of the SPC is to supervise and guide the trial of money laundering crimes and formulate judicial interpretations in a timely manner in response to relevant legal issues encountered (督办、指导洗钱犯罪案件的审判,针对审理中遇到的有关适用法律问题,适时制定司法解释)It is understood that at a staff level, discussions take place regularly, and the SPC has issued several judicial interpretations as a result.
  4. As mentioned in a blogpost in 2020, in 2017 the State Council approved an Inter Ministerial Joint Conference on the Popularization of Law, with Zhang Jun, then head of the Ministry of Justice, as head and the SPC as one of the parties.

SPC established coordination mechanisms

The SPC establishes coordination mechanisms with other government and Party departments such as:

  1. The family trial method and work joint conference mechanism (家事审判方式和工作机制改革联席会议), established in 2017 with Central Political-Legal Commission consent; and
  2. Under the framework of Inter-Ministerial Joint Conferences, specific coordination mechanisms may be established. One likely product of ongoing policy discussions under the framework of the Intellectual Property Inter-Ministerial Joint Conference discussed above was the January 2021 establishment of a mediation coordination mechanism between the SPC  and the China National Intellectual Property Administration.

Legal basis

The legal basis of coordination appears to be Article 2 of the Organic Law of the People’s Courts in which the courts are called upon to “guarantee the smooth progress of the building of socialism with Chinese characteristics.”

Comments

In the New Era, we can expect to see more and more coordination by the SPC, much of it invisible to those of us outside the system.  It appears to be a recognition of the technical competence of the SPC in resolving a broad range of technical issues required to be resolved in furtherance of the governance of the country.  The State Council and its ministries and commission need the SPC’s expertise to deal with a large variety of legal issues–criminal, civil, administrative, enforcement.  The SPC coordinates with other central Party and state organs because it needs them to resolve specific issues. Given China’s state-run governance model, establishing mechanisms to better coordinate and promote national strategies and targets, and better draft policies and measures are considered an efficient way to accomplish governance targets and serve the needs of the Party and country.

 

 

Happy Niu 🐂Year!

 

 

 

 

 

 

 

Happy Niu 🐂Year to all blog followers and readers! Best wishes to all for good health, success in work and study, and all else!

In recent weeks I have been focusing on several longer pieces of writing and am still in “focus mode.”

While most of the Supreme People’s Court  (SPC) has been taking a break, based on previous year’s reports, it is likely that the team of people working on drafting President Zhou Qiang’s speech to the National People’s Congress (NPC) are hard at work.  I surmise that they will draw on January’s Central Political-Legal annual work conference, where responsibilities for implementing this year’s major tasks were allocated, and guidance from President Xi was transmitted. At that time, the Party leadership heard work reports from the SPC’s (and Supreme People’s Procuratorate’s) Party Group, so it seems likely that the report to the NPC will draw on that report as well.

Among the content that I expect to be included in the report is:

  • successful transition to the Civil Code, including review  of old judicial interpretations (and other judicial normative documents), canceling and amending old ones;
  • successes in meeting the challenges that Covid-19 meant for the courts, including the increased use of online proceedings;
  • smart courts and informatization;
  • accomplishments of the Supreme People’s Court’s Intellectual Property Court, including its first anti-suit injunction;
  • the issuance, for the first time, of reports on the judicial review of arbitration in 2019 and judicial assistance in civil and commercial matters between the Mainland and Hong Kong.  The full text of the two reports has not yet been released to the public, so I surmise that they will be released during the NPC meeting;
  • In the area of criminal law, likely the effective use of criminal proceedings in the battle against Covid-19;
  • successes in the saohei (organized crime) campaign;
  • successes in the area of environmental law, such as the recent signing of a framework agreement between the SPC and the leading small group on the protection of the Yellow River and the June, 2020 policy document on providing judicial services and guarantees to the protection and high quality development of the Yellow River;
  • furthering of socialist core values, such as the guiding opinion issued on 18 February on integrating those values into judgments (最高人民法院印发《关于深入推进社会主义核心价值观融入裁判文书释法说理的指导意见) and
  • judicial reforms such as the recently approved establishment of the Beijing Financial Court (the Shanghai Financial Court has been very busy since it was established) and the piloting of reforms to separate simple and complicated cases (the SPC recently submitted a midterm report to the NPC Standing Committee on the pilots).

We’ll see next month how accurate the above guesses are. In the meantime, additions or corrections are welcome.

______________________________________

The SPC New Year’s greetings are ©the SPC, found in this short video 

Supreme People’s Court’s new guidance on similar case search

Screenshot 2020-07-27 at 8.49.14 PMOn 27 July 2020,  the Supreme People’s Court (SPC)  issued Guiding Opinions Concerning Strengthening Search for Similar Cases to Unify the Application of Law (Guiding Opinions) (关于统一法律适用加强类案检索的指导意见(试行)),  effective on 31 July.  It is not a judicial interpretation, rather it is guidance intended to make judicial decisions more consistent, an ongoing issue in the Chinese court system.  The SPC is approving the practice of judges using principles derived from prior cases to fill in the gaps in legislation and judicial interpretations.  The Guiding Opinions codifies many of the practices of the Chinese courts and imposes some new requirements. It does not mean that China has become a common law legal system.  As explained further below, although the Guiding Opinions do not address this question, comments by an SPC judge suggest that the special status of cases selected by the SPC by its operational divisions remains in place.

It also illustrates two larger points–that discrete judicial reforms aimed at more consistent judgments continue to be implemented even as the role of Party leadership and oversight continues to be stressed. It is also an illustration of how long it can take judicial reforms to be implemented. in my view, this discrete, technical reform has implications greater than the drafters of the Guiding Opinions realized, including a possible impact on Chinese legal education. It has the potential to make litigation a more predictable process for parties.

Case Search Requirements

What are similar cases?

Article 1 defines that–the cases that are already effective and are similar in their basic facts, disputed points, issues of law, etc. (指与待决案件在基本事实、争议焦点、法律适用问题等方面具有相似性,且已经人民法院裁判生效的案件).

When is similar case search required? (Articles 2 and 7)

  1. When a case is proposed to be submitted to a professional or specialized  (presiding) judges meeting (generally all the judges in a division) or the judicial/adjudication committee for discussion;
  2. Relevant judicial principles are unclear or conflicting;
  3. A court president or division head requires it under his or her supervision authority;
  4. Other relevant situations.

That is, similar case search is not required in all cases, only when the relevant “law” is unclear.

Similar case search should be set out in the trial report for the case or in a separate precedent (similar case) report (类案检索报告) and included in the case file. As noted in my earlier blogpost, trial reports are confidential and not accessible to parties or their lawyers. Article 8 requires that the search report must include details on the platform, means of search, etc. and how the search was used.

Who searches and how?

The judge in charge of the case (承办法官) is in charge of undertaking the search and is responsible for doing it accurately and properly, using either the SPC’s database or other case databases, focusing on cases from the last three years, except for guiding cases.

Judges can use methods such as keyword search, legal provision (article of the relevant law), or related case search.

What must be searched?

These rules (in Article 4) are in line with what I have previously written:

  1.  SPC guiding cases;
  2. SPC typical (model) cases (典型案例) and judgments or rulings of the SPC;
  3.  Reference cases issued by provincial-level higher people’s courts  and decisions by those courts;
  4.  Higher-level courts in the jurisdiction in question and judgments of that court.

Except for the guiding cases, priority is given to the search of cases or cases in the past three years; if a similar case has been searched in the previous order, no search is required. Article 5 provides that judges can use methods such as keyword, legal article-linked, and case-based searches.

My understanding is that these are general principles, but the specific scope of cases that need to be searched will depend on the specifics. As I have previously written, the SPC Circuit Courts have issued cases that guide the lower courts in their circuits.  The special authority of those cases remains in place. Judges reviewing issues related to the enforcement of foreign arbitral awards in China will need to look to a special set of cases (described here), for example.

I had previously written about cases selected by the operational divisions of the SPC providing guidance to the lower courts.  Those retain their special authority, as indicated by comments by Senior Judge Yu Tongzhi, an editor of Reference to Criminal Trial (the joint publication of the SPC’s five criminal divisions). He noted in an article published on 31 July, that as far as criminal justice is concerned, without a doubt, the first choice for searching similar cases is to search the guidance cases contained in their publication, setting indices to the guidance cases for the convenience of readers.

Are precedents binding?

Precedents are not binding, but guiding cases should be 参照 “referred to” (the link is to SPC Research Office Deputy Director  Judge Guo Feng’s authoritative explanation) unless the case conflicts with subsequently issued law or judicial interpretations. Other types of cases are not binding, but for judges to consider(参考).

How judges must respond

Article 10 imposes a new requirement on courts, if procurators, parties, their representatives (their lawyers) submit guiding cases or other cases in support of their legal position (as I had previously written had been the practice).  For guiding cases, courts are required to state in the reasoning section of their judgments whether or not the guiding case was referred to and why.

For all other types of cases, the court can use its power of clarification/explanation and other means (释明等方式) to respond.  It is understood that this is meant to give judges flexibility in responding to (non-guiding) judgments provided by parties–so the court may respond in its court’s judgment or in other ways. Those other ways may include:  responding to the cases submitted pre-hearing, during a hearing, after a hearing, as the court considers most appropriate.  We will need to observe what is done in practice, for example, whether courts respond primarily in their judgments or orally.  This will be the way that a party can monitor whether the search accurately reflects prior cases, as neither a party or its counsel has access to the trial report. Other unknowns are how this system will influence administrative proceedings such as those at the Trademark Review and Adjudication Board.

Link to Inconsistent Decision Mechanism

Article 11 contains a link to the inconsistent decision mechanism discussed here, which I described as a microcosm of themes reflecting how the SPC operates, given its high bureaucratic nature.

Why case law reform?

As this blog has discussed, in the New Era, the role of Party leadership and oversight continues to be stressed (see this blogpost, for example).  This discrete judicial reform is aimed at more consistent judgments. It is a critical tool that judges are already using because Chinese legislation lags behind the needs of the courts, and judicial interpretations are insufficient as well. Party policy would have an indirect impact on those cases, as would foreign law principles (mentioned here).

“Slow-cooking” judicial reform

The issuance of these rules shows the strength of the case law system and how long it can take a single judicial reform to be implemented. As mentioned in the June, 2019 blogpost, when Professor Hu Yunteng(until recently Justice Hu Yunteng, formerly a full-time member of the SPC’s judicial committee, now retired) recollected the history of the case system with Chinese characteristics, he mentioned that Jiang Huiling, then his colleague at the China Institute for Applied Jurisprudence (now Dean of the Tongji University School of Law) had looked to jurisdictions outside of China to advocate that China establish a case law system. Professor Hu Yunteng doesn’t specify whether Dean Jiang Huiling was looking to case law systems in civil or common law jurisdictions in the “West.”).  In his 2016 Harvard Law Review student note, Mark Jia (now clerking on the Supreme Court), cited Li Shichun of the China Law Society to the effect that it was the National People’s Congress that opposed those seeking to establish a Chinese case law precedential system. That opposition has been overcome by widespread professional usage (as described in my 2017 Tsinghua Law Review article). It is unusual in that the practice came first and was not a top-down reform (顶级设计).

Concluding Comments

This discrete, technical reform is an important one for the rules relating to judicial decision-making better harmonized with judicial practice.  There are a number of unknowns.  One is whether it will result in judges feeling more comfortable in setting out their reasoning,  knowing that other judges may look to it.  An important question is how the practice of responding to cases will evolve–will judges tend to respond in their judgments, or as I suspect, do it orally. (As to why I think that–it is related to the desire of Chinese judges to reduce their risk under the judicial responsibility system).

In my view, this reform has the potential to make Chinese litigation a more predictable process. It is a bit of evidence of the gradual harmonization of the operations of the Chinese courts with the rest of the world,  as current circumstances permit.

 

Supreme People’s Court’s Bench Memoranda?

Screenshot 2020-07-17 at 2.05.58 PM
Trial report and criminal judgment, from a Shantou district court

Justice Ginsburg’s article “Workways of the United States Supreme Court” and recent correspondence with brother blogger Mark Cohen has led me to reflect on what is known (and what I know) about how cases progress through the Supreme People’s Court (SPC). It is from the small details that it is possible to obtain greater insights about a judicial system.

In discussing the sources of law (meant broadly) to which SPC judges look when considering cases,  some knowledgeable persons reminded me of the existence of something called a “trial report (审理报告 or 审查报告 (for retrial cases)).  I analogize these to bench memoranda (as used in United States appellate courts),  although the analogy is imperfect. It seems also somewhat analogous to the Votum of the German Constitutional Court, although the analogy is imperfect. Perhaps a search through Soviet (or Russian) civil procedure legislation will reveal a better counterpart.

As to what a trial report is, it is a memorandum prepared by the judge in charge of the case ( 承办人), prepared for internal discussion within the court. That internal discussion is in the first instance by the collegial panel that heard the case.  If the collegial panel feels they need greater guidance (or other related factors are relevant, such as the case being “difficult” or “important”), the trial report may be used in discussion by the specialized judges meeting or if necessary, among the documents included in the package of documents submitted to the judicial (adjudication) committee (or specialized judicial (adjudication) committee).

A search of the Chinalawinfo (北大法宝) database revealed that the same term is used for internal memoranda prepared in the course of administrative penalty proceedings and Party disciplinary and other analogous proceedings.

The outside observer is handicapped in analyzing trial reports in great detail because few examples are available to those outside the system, as explained further, with a few found in specific databases. As for the reason for the handicap, that relates to a number of regulations that keep trial memoranda confidential, some mentioned in my article on judicial transparency.  Those include:

  • 2013 joint regulations by the SPC and the National Archives Administration (State Secrecy Bureau) requiring such memoranda to be placed in the supplemental file (副卷). Items in the supplemental file are confidential, as discussed in that article.  The article also discusses proposals within the Chinese court system for public access to the supplemental file;
  • regulations on work secrets, also discussed in my article.

Trial reports are mentioned in a number of SPC regulations and in documents issued by the SPC’s Judicial Reform Office. It is clearly one of the many discrete matters about which reform is being considered.

The trial report is a memorandum in which the judge in charge of the case sets out the facts of the case, evidence provided and facts determined; prior rulings or decisions in the case; issues in dispute; background information; proposed resolution of the case and rationale. The judge is not bound by the restrictions in the sources of law that may be cited, with some judges stating that the results of discussions with experts or foreign principles of law or cases are sometimes included.

Some reports I have seen have a section on “issues to explain” (需要说明的问题)–that raises non-legal factors, such as the impact of enforcement of an international arbitral award on the local economy. The rationale in the report may be more detailed than that in the judgment or ruling that is issued to the parties. As has been mentioned in earlier blogposts, only certain sources of law may be cited as the basis of a judicial ruling or judgment. The trial report apparently can take a broader approach to legal sources, which would be in keeping with the holistic approach that Chinese judges take to deciding cases. The trial report, unlike the judgment or ruling, is confidential. The SPC has issued forms of trial reports, such as this one for administrative retrials; others for first-instance administrative cases; second instance administrative cases; state compensation cases.

SPC rules of operation call for a judge‘s assistant to be responsible for preparing a draft of a trial report, with the judge in charge of the case responsible for it.  Interns may be involved in preparing a preliminary draft for the judge’s assistant to whom they are attached (as I know from my own students who have interned at the SPC). The judge’s assistant will review the intern’s draft thoroughly. There are proposals to require search of relevant prior cases, but this is something that likely is general practice at the SPC (see my article on case law).

A recent article by an experienced Chinese judge (at the local level) points out problems with the trial report system (at the local level). In his experience, since the last round of judicial reforms, most judges do not care much about drafting a trial report, in their rush to process cases on time. They, therefore, fail to provide a holistic report on the case. That complicates matters for the second instance judge reviewing the case file. Because the trial report does not describe fully the scope of factors that entered into judicial thinking, the second instance judge lacks a full understanding of the case. He says that for a Chinese judge, in addition to the facts and law, among the other factors to consider include:  judicial policy; petitioning and stability maintenance; the impact of media; the impact of the decision; interference and inquiries from either inside or outside the court; value judgments of individual judges.  In his experience, at least, the responsible second instance judge will meet face to face with the lower court judge to seek to understand the whole picture, rather than solely relying on the case file.  He points out that this practice has its drawbacks.   The author suggests using a system that he entitles “explanation of the situation regarding the decision” (裁判情况说明) rather than a trial report.

Concluding comments

The fact that little is known about trial reports speaks to how little scholars (in China or elsewhere) focus on the details of how the Chinese legal system operates.

As to whether judges would favor making trial reports public–an unscientific sample says no. One suggestion that I have heard was that a broader approach should be taken to sources that could be cited in a judgment, so that a judge could cite to persuasive scholarly works. But what if it is revealed that judicial thinking on a particular issue has been influenced by foreign theories?  The thoughtful Chinese judge wants to be both politically and legally correct.

Using cases to explain the law in the New Era

Screen Shot 2020-07-08 at 3.32.23 PM
News conference to announce the issuance of 10 exemplary cases promoting socialist core values

As readers of this blog know, I have a special interest in the use of cases in the Chinese court system. I wrote most recently on the SPC’s use of cases in December, 2019, when I wrote How the Supreme People’s Court guides the lower courts through cases in its publications (1). In this blogpost, I am taking another look at two aspects of this topic in the post 4th Plenum of the 19th Party Congress New Era. A consolidated version will need to wait for an opportunity to write on this at greater length.

The SPC uses case law in two broad ways.  The first is to guide the lower courts, as previously mentioned in several previous blogposts and my 2017 academic article. Those developments are continuing. I’ll discuss one new example.  What I have not previously discussed very much, and will be the focus of this blogpost is how the SPC uses case law to popularize law (普法).

Guiding the Lower Courts

One example that I have not previously discussed, but is relevant to many practitioners, is the case law of the SPC’s Intellectual Property Court (SPCIPC, literally the SPC’s Intellectual Property Tribunal). A measure of the importance that the SPCIPC attaches to its cases in that the following paragraph was the first substantive section of its 2019 annual report [scroll to the bottom of the link for English]:

Ⅰ. Focus on the function of trial [court hearings] to strengthen typical exemplary effect of model cases and further unify the standards for adjudicating technology-related IP cases
Unifying the standards for adjudicating patent and other technology-related IP cases is the primary goal of the IP Court. In 2019, the IP Court focused on the function of trial and concluded a number of closely technology-related IP cases justly and efficiently in accordance with the law. A number of model judgments that have typical exemplary effect were made, and the “systematization project to unify judicial standards” has been implemented, further promoting the unification of judicial standards for technology-related IP cases. ( 一、立足审判职能,加强典型示范,进一步统一技术类知识产权案件裁判尺度
统一专利等技术类知识产权案件裁判标准,是法庭设立的重要目标。2019年,法庭立足司法审判职能,依法公正高效审结了一批专业技术性较强的知识产权案件,形成了一批具有典型示范作用的标杆性判决,建设实施“统一裁判标准系统工程”,进一步推动了技术类知识产权案件裁判尺度的统一。

In 2020, we can expect the SPCIPC to continue to use case law to unify judicial standards in technology-related IP cases.  This is one small example of the SPC’s work in this area.  The report speaks of its contribution of Chinese wisdom to the development of international IP law, but a person taking a closer look at some of the SPCIPC decisions will see that research of foreign law by SPC IP judges and interaction with persons with foreign law expertise has contributed to the development of Chinese wisdom.

Popularizing law (普法)

The second development is the popularization of law, an old development repurposed in the post 4th Plenum of the 19th Party Congress New Era. The close observer of these documents, implementation, and related activities can detect a repurposing of popularization for specialist purposes.

Popularizing law is mentioned in the policy document Opinions of the Supreme People’s Court on Thoroughly Implementing the Spirit of the Fourth Plenum of the 19th Party Congress to Advance the Modernization of the Judicial System and Judicial Capacity (Implementing the 4th Plenum of 19th Party Congress Opinions), the subject of my May, 2020 blogpost. The last sentence in section 5 of the opinion, on improving the implementation of socialist core values and the ideological responsibility system stated:

Conscientiously implement the responsibility system for publicizing knowledge about law (普法) of “whoever enforces the law, explains the law”; strengthen public opinion guidance, perfect the mechanism for issuing typical cases; establish rules of conduct through fair decisions [judgments and rulings], promote [positive] social customs, and create a good environment for the rule of law.”认真落实“谁执法谁普法”普法责任制,加强新闻舆论工作,健全完善典型案例发布机制,以公正裁判树立行为规则、弘扬社会风尚,营造良好法治环境.

The responsibility system for publicizing knowledge about law (普法) of “whoever enforces the law, explains the law” relates to pufajiaoyu (普法教育) (educating the public about law).(For those with access to an academic library I recommend Susan Trevaskes’ related book chapter) on how pufajiaoyu has developed over time).

Background to this system

This pufajiaoyu responsibility system is mentioned in section V of the 4th Plenum Decision of the 18th Party Congress and is one of many different types of responsibility systems mentioned in that Decision. This responsibility system for publicizing knowledge about law is linked to broader Xi Jinping era Party initiatives to expand the responsibility of Party and government cadres.   In this context the SPC appears to be treated as any other state or Party organ.

The phrase in the 4th Plenum Decision has been built into a responsibility system for the courts through two documents and a joint ministerial system. The framework was set out in a joint Party-State Council document in 2017  “General Offices of the Party Central Committee and State Council Opinions on a Popularization of Law Responsibility System of State Organs Regarding “whoever enforces that law, explains the law.” (中共中央办厅 国务院办公厅印发《关于实行国家机关“谁执法谁普法”普法责任制的意见》Section 6 calls for judge, procurators, administrative enforcement personnel, and lawyers to establish a “using cases to explain the law” system (建立法官、检察官、行政执法人员、律师等以案释法制度). The document calls on judges, etc. to collect, sort, research and issue cases and establish a database, using exemplary/model/typical cases to guide, standardize, and as prevention  and for education.  典型案例的收集、整理、研究和发布工作,建立以案释法资源库,充分发挥典型案例的引导、规范、预防与教育功能。So from this one line in document it is possible to see popularization used for specialist purposes (standardization).

Later in 2017, the State Council approved the establishment of an interministerial joint conference on the popularization of law, with Zhang Jun, then head of the Ministry of Justice, as head and the SPC as one of the parties. At the end of 2017, the SPC issued its own document to implement the Party-State Council document, 人民法院贯彻落实〈中共中央办公厅 国务院办公厅关于实行国家机关“谁执法谁普法”普法责任制的意见〉的实施意见》(SPC Explaining the Law Opinions).   This document is the one guiding the work of the SPC most closely.

Section 9 of the Explaining the Law Opinions focuses on the use of cases for both popularization and specialist purposes.  It calls for establishing a system for judges to explain the law in the cases they hear (as a form of popularization). On the specialist side, it calls for judges to upload cases to the SPC case database according to regulations and increase the reasoning (说理) in their judgments. The latter can have both specialist and popularization and “rule of law” impacts.  If parties or the general public are convinced by the reasoning in a judgment, they are more likely to accept it as fair. However many factors (to be explored in a later blogpost and my students’ forthcoming articles) lead to judgments with thin reasoning. This document also calls for collecting, sorting, researching and issuing exemplary cases and organizing news conferences if useful. These exemplary/model/typical cases can have both specialist and popularization impacts.  One example, that I would recommend is a recent article by an SPC judge who studied at the University of Vermont, who published an article in the Vermont Journal of Environmental Law article on a case that was designated one of the ten top mining rights typical cases.

So it seems that the Implementing the 4th Plenum of 19th Party Congress Opinions will be further implementing the provisions in the responsibility system for publicizing knowledge about law (普法) of “whoever enforces the law, explains the law” for both specialist and popularization purposes. In a later blogpost, I’ll explore the provisions in the pufajiaoyu 普法教育 responsibility system relating to judicial interpretations and judicial transparency.

Supreme People’s Court’s New Vision for the Chinese courts

Screenshot 2020-05-02 at 6.35.07 PM
Publicity related to the document analyzed below

The month of April saw the Supreme People’s Court (SPC) issue many judicial policy documents, consistent with the commitment made in January 2020 to Party leadership to better serve the Party and state.

To the outside observer, a document issued on 1 April appears to signal the way that the Chinese judicial system will develop in the post-19th Chinese Communist Party (Party) Congress Fourth Plenum New Era.  The document is entitled Opinions of the Supreme People’s Court on Thoroughly Implementing the Spirit of the Fourth Plenum of the 19th Party Congress to Advance the Modernization of the Judicial System and Judicial Capacity (最高人民法院关于人民法院贯彻落实党的十九届四中全会精神推进审判体系和审判能力现代化的意见) (Implementing the 4th Plenum of 19th Party Congress Opinions). It implements “Implementing Opinions on Comprehensively Deepening Reform in the Political-Legal Field” (the text of this January 2019 document 关于政法领域全面深化改革的实施意见 has not been issued publicly) and “The Fifth Five-Year Reform Outline of the People’s Court (2019-2023) and obviously, the Decision of the 4th Plenum of the 19th Party Congress (4th Plenum Decision). The fact that the first document has not been issued publicly means that outside observers can identify its implications only through summaries in the press and implementing documents. The Party’s regulations on transparency (explained here) do not cover documents of this sort.

The Implementing the 4th Plenum of the 19th Party Congress Opinion is a framework document in which the Supreme People’s Court (SPC) identifies principles and goals for the Chinese judicial system and judicial capacity after the 4th Plenum of the 19th Party Congress. This blogpost will identify some of them and their link to the 4th Plenum, with related comments in italics. I expect that the SPC will issue specific judicial policy documents and judicial interpretations, as appropriate, to implement specific measures.

New Era Governance

The document needs to be seen as part of the larger picture for China’s governance set out in the 4th Plenum Decision.  Section 1 states that  “modernization of the judicial system and judicial capacity is an important part of the modernization of the national governance system and governance capability” and is needed, among other matters, to provide judicial services and guarantees for societal and economic development. One aspect of the importance of its judicial services is the fact that there were 28 million cases in the Chinese courts in 2018, most of them civil and commercial.

Political correctness

Several sections relate to political correctness.  This is linked to the clear requirement in the 4th Plenum Decision,  under the topic “perfecting the comprehensive leadership of the Party  (健全党的全面领导制度.)”  The 4th Plenum Decision also requires implementing the ideological responsibility system integrating socialist core values into law and social governance. This document, therefore, contains corresponding provisions.

Party leadership

Consistent with last year’s National People’s Congress report and other documents, this document states that the most important goal is to uphold and implement the Party’s absolute leadership of the courts and persist in putting the Party’s political construction first. It restates tasks for the courts, some of which were earlier flagged on this blog:

  • effectively implementing the Party’s leadership in all areas and aspects of the work of the people’s courts and ensuring the independent and fair exercise of judicial power under the leadership of the Party.  Related language is found in the 4th Plenum Decision. This requirement is found in the latest judicial reform plan and elsewhere, including judicial training (as discussed here);
  • Improve the system for implementing major decisions of the Party Center (完善党中央重大决策落实机制) (found in the 4th Plenum Decision and documents thereafter);
  • strictly implementing the [Party] system of reporting and seeking approval for major matters [also known as requests for instructions](严格落实重大事项请示报告制度)(the Party regulations on reporting and seeking approval for major matters) (mentioned here);
  • strengthening improvements from political inspection (see my blogpost on the inspection of the SPC) and judicial inspection (强化政治巡视和司法巡查整改) (discussed in my forthcoming article) (related content found in the 4th Plenum Decision. Judicial inspection is an old institution repurposed in the new era);
  • implementing the Party’s reporting and inspection system (督察落实情况报告制度, mentioned in the 4th Plenum report and thereafter).

As mentioned in a recent blogpost, this means implementing Party principles concerning the appointment of personnel, particularly those in a leadership position. These trends are linked to broader policies related to civil servants (this recent academic paper by Holly Snape has good insights).

Socialist Core Values and the Ideological Responsibility System

Section 5 focuses on socialist core values and the ideological responsibility system, both of which the 4th Plenum Decision stressed.

  • On the ideological responsibility system, this (authoritative) article (the author was then at the Party’s Central Compilation and Translation Bureau), unfortunately behind the publisher’s high paywall), sets forth an authoritative explanation of this concept in Xi Jinping New Era Governance that some of us need. The author defines the ideological responsibility system as follows:  it “is part of the political reforms and aimed at maintaining and improving the loyalty of the Bureaucracy, as well as maintaining their ideological unification…Under the current Xi administration, the CCP wants its cadres to be politically reliable, professional and competent, morally self-regulated, and preferably trusted by the people…
  • Resolutely prevent and oppose the eroding influence of Western mistaken thinking (坚决防范抵制西方错误思潮侵蚀影响).  This phrase has evolved from the one used several years ago and mentioned on this blog: “resolutely opposing erosion by the mistaken Western rule of law viewpoint” (坚决抵制西方错误法治观点侵蚀).  Related language appears in the 4th Plenum Decision: have a clear-cut stand opposing various types of erroneous views (旗帜鲜明反对和抵制各种错误观点 ). This observer surmises that this phrase appeared in the 2019 Party document mentioned above. This does not create obstacles to Chinese judges continuing to consider useful “Western” legal concepts and mechanisms and the SPC continuing to have exchanges and cooperation projects with major “Western” jurisdictions.
  • Implement socialist core values in the work of the courts. This has multiple aspects and continues an ongoing theme, including in judicial interpretations–see my 2018 blogpost). Some high-level conferences organized by the Case Research Institute of the National Judicial College have been on the subject of promoting socialist core values through cases.

Practically oriented

The more practically oriented sections (4, 6-8) reveal priority areas of SPC leadership concern. Those particularly relate to economic development, social stability, judicial reform, and technological upgrading, all topics found in the 4th Plenum Decision., while the section on public health emergency management relates to Party decisions and Xi Jinping speeches during the Covid pandemic.

These sections mention short, medium, and long-term areas of concern and development.

Section 4 of the document lists some of the priority matters relating to economic development facing the SPC and the lower courts, many of them mentioned in this year’s judicial interpretation list or recently announced judicial reforms. A curated version (translation is modified Google translate):

  •  Improve risk monitoring and the early warning mechanism in financial trials,  properly hearing financial disputes, and actively preventing and resolving financial risks (therefore we have seen the establishment of the Shanghai Financial Court and specialized financial tribunals in certain major cities. More detailed observations on this will come in the future);
  • fully implement the environmental public interest litigation system, improve the environmental remediation system, improve the environmental protection injunction system, improve the jurisdiction provisions in environmental cases. (The 4th Plenum Decision had a section on environmental protection and a July 2019 press conference linked to the fifth anniversary of SPC’s Environmental and Natural Resources Division mentioned these measures.)
  • Use evaluation indicators such as “enforcing contracts” and “handling bankruptcy”,  to improve trial management, mechanism, quality, and efficiency to create a stable, fair, transparent, and predictable legal business environment. (This is linked again to the 4th Plenum Decision and China’s ranking on the World Bank’s Ease of Doing Business scorecard).
  • Intensify the review of the legality of administrative actions, strengthen the substantive resolution of administrative disputes (also linked to the strengthening of administration by law in the 4th Plenum Decision, therefore also on the 2020 judicial interpretation agenda).
  • Strengthen the judicial protection of property rights. See earlier blogposts on this.
  • Formulate judicial interpretations for cases of infringement of trade secrets, and continuously improve the level of judicial protection of intellectual property rights (IPR). (Improving trade secrets protection is mentioned in the 4th Plenum Decision. Also see Mark Cohen’s recent blogpost on this).
  • Formulate judicial interpretations of punitive damages for intellectual property rights, promote the establishment of a tort damages compensation system that reflects the market value of IPR (IPR is stressed in the 4th Plenum Decision and punitive damages in IPR cases is mentioned. Also see Mark Cohen’s blog on this.  This also relates to evidentiary issues in IPR cases).
  • Mediation and diversified dispute resolution (including giving non-litigation methods of dispute resolution priority, improving the separation of disputes and the creation of one-stop dispute resolution and litigation service that is efficient and low cost) is mentioned in this document as well.  It is unclear what this means for the development of a commercial mediation system in China.  Local courts have been working on better cooperation with institutions that can mediate specialized disputes, such as the Shanghai Financial Court’s arrangements with the Shanghai Stock Exchange and other institutions. The provisions here derive from language in the 4th Plenum Decision on improving an effective system in the new situation for the correct handling of internal contradictions among the people (完善正确处理新形势下人民内部矛盾有效机制) as well as the Fengqiao Experience. Xi Jinping has mentioned the Fengqiao Experience since 2013, if not earlier. The phrase about internal contradictions appears to derive from the 1959 Mao essay, On the Correct Handling of Contradictions Among the People.
  • Promote capacity building for foreign-related commercial and maritime trials, equally protect the legitimate rights and interests of Chinese and foreign parties in accordance with law, improve the diversified dispute resolution mechanism for international commercial disputes, serve the joint construction of the “Belt and Road” and the construction of free trade pilot zones and free trade ports ( The 4th Plenum Decision promotes a high-quality Belt & Road Initiative, so these measures implement the 4th Plenum Decision. Also, see my earlier blogpost on this.  To better improve diversified dispute resolution in cross-border cases, China needs to work on institutional arrangements enabling it to ratify the Singapore Mediation Convention. Those are many and complex, as I had a chance to learn in December, 2019. One matter that would assist foreign parties litigating in the Chinese courts (and Chinese parties litigating outside of China) would be for China to accede to the Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents.  The SPC’s new evidence rules reduce the scope of documents that a foreign litigant (or domestic litigant providing foreign evidence) must notarize and legalize, but it is a troublesome and expensive process.
  • Improve the adjudication mechanism involving Hong Kong, Macao and Taiwan, build a centralized and professional trial system, explore and improve the diversified settlement mechanism for [civil/commercial] disputes involving Hong Kong, Macao and Taiwan. (The centralized system seems to be analogous to foreign-related cases. The intent is to have more competent judges consider these. Another issue is parallel proceedings in these cross-border cases. These issues deserve further analysis.)
  • Deepen the international judicial exchange and cooperation mechanism, participate in the reform of the global governance system and formulate rules of international law, and contribute more Chinese wisdom to the maintenance of the multilateral trading system and the international rule of law. (See my earlier blogpost on this).

Public health emergency management

Section 6 relates to the role of the courts in the public health emergency management system, in the short and long terms.  It mentions the courts providing judicial services to the joint prevention and control system, preventing mass events, and group prevention and control (群防群治工作机制, an old system to which Xi Jinping has given new meaning during the pandemic. That section mentions shorter-term issues, such as punishing the manufacturing and sale of fakes during the pandemic and longer-term issues, such as the courts being involved in improving the legal system in the area of public health.

Judicial Reform

Section 7 highlights some of the tasks in the current judicial reform plan. Those include:

  • Deepening the judicial responsibility system, for judges hearing cases solely or in a collegial panel, the members of a judicial committee, and the supervision of judicial power.  As mentioned on this blog several times, judges are concerned about the scope of the judicial responsibility system, and recent cases that have appeared in the Chinese press would only amplify those concerns. I have more on this in a forthcoming book chapter.
  • Improving the disciplinary mechanism for judges. The forthcoming book chapter is on this. The SPC is working on related regulations.
  • Promoting the improvement of the policies relating to the selection of judges level by level. The controls on the number of “quota judges,” judges with the title of “judge,” in many courts, means that some number of qualified personnel have become judges assistants. It has created a fair amount of frustration.  Another issue is that the new policies mean it takes longer for judges to be promoted, but at the moment, most judges need to retire at 60, so that the pool of judges eligible to be promoted eventually to the SPC will shrink. We can expect related policies issued in the medium term.
  • Improving the working mechanism of the circuit courts and promote the Supreme People’s Court’s Intellectual Property Court (SPCIPC) and the China International Commercial Court (CICC). Promote the strengthening of the organization system of intellectual property courts, and improve the specialized trial system so that it complies with the principles for the judicial protection of IPR. (It is understood that the circuit courts are hearing most SPC cases.  But it still leaves unanswered what the role of the SPC in hearing cases is.  Should it best focus on considering a smaller number of cases more thoroughly, as other supreme courts do? The SPCIPC and CICC both have captured SPC leadership attention (and the attention of the outside world). It is clear that the SPC has provided much more support to the SPCIPC than the CICC (most obviously the SPCIPC operates full time, while the CICC does not). China’s IPR enforcement system is a topic of worldwide concern (the Phase 1 Trade Agreement and the United States Trade Representative Office’s recent 301 Report both evidence this), so it is likely that this means the SPC leadership will focus more on intellectual property issues.
  • Deeply promote the reform of the trial-centered criminal justice system (this is a continuation of reforms initiated in the previous round of judicial reforms).  This topic requires a separate analysis, to consider the impact of the National Supervision Commission, among other issues.
  • Improve and deepen the judicial transparency mechanism including promoting the transparency of judgment documents, court hearings, trial process information, and execution information. See my earlier blogpost and Mark Cohen’s more recent one on his concerns in the area of intellectual property law.  Professor He Haibo has done important empirical work on judicial transparency.

Technology

Section 8 relates to technology and implementing the courts’ five-year plan on informatization (人民法院信息化建设五年发展规划).  It mentions promoting AI, big data, cloud computing, blockchain, and 5G. Litigants should know that the SPC is promoting online case filing, litigation, mediation, judicial blockchain, and the mobile micro-court.  A reality check is needed for China’s online litigation publicity.  One is provided by a popular Wechat article published last month “A month of online court hearings, judges and lawyers have all gone crazy” 云庭审上线一个月,法官律师都疯了Technology is an important area of SPC leadership concern, as it sees it as an area in which China can take the lead.

Take-aways?

What is the impact of this vision and program for the Chinese courts, for litigants (in China or elsewhere), and for others, including judiciaries in other countries and jurisdictions. Is this a “China model” for courts, as raised by some? It does not appear to be so, but rather an outline for the courts to be conveyed within China, rooted in the Chinese political, cultural, and social environment of 2020, which will change along with Party priorities and events.  Some aspects described above are common to judiciaries around the world, such as the trend towards greater online justice.  Will it deliver the results it promises?

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

Controlling Judicial Headcount in the New Era

Screenshot 2020-03-19 at 4.32.02 PMIn the middle of March 2020, the Supreme People’s Court (SPC) Party Group convened a meeting (pictured above) to discuss the topic of “strengthen the awareness of the system, maintain the authority of the system, make stricter the management of the system, build a tougher court team, and work hard to build a model organization on which the Party Center can rely and that satisfies the masses (强化制度意识,维护制度权威,严格制度管理,打造过硬法院队伍,努力建设让党中央放心、让人民群众满意的模范机关).  Part of this phrase appeared in several of my blogposts in the past year (not surprisingly), and also can be seen across used by other Party and state institutions in 2019 (not surprisingly).  Although the discussion at the meeting centered around two topics–judicial headcount (bianzhi 编制) and selecting leaders (领导干部选拔任用, nomenklatura)–this short blogpost will focus on judicial headcount (bianzhi).

Chinese law, unlike legislation in many countries (see German legislation, for example), does not state clearly how many judges are on its highest court. It is also unclear how many persons work in the operational divisions of the SPC (the ones that decide cases) vs. the administrative (general, 综合部门) of the SPC.  As I wrote in an earlier blogpost, it is unclear how many judges in the SPC have been “borrowed” from the lower courts.  And as I wrote earlier about the SPC judicial committee, it appears that likely that the Central Staffing Commission regulates the number of persons who can be SPC vice presidents. I surmised that Justices Hu Yunteng, Liu Guixiang, Pei Xianding, and He Xiaorong were given the title of  “专委“ (full-time members of the judicial committee) to give them a bureaucratic rank equivalent to being an SPC vice president, with attendant privileges. The bianzhi system supplies the reason.

The bianzhi system provides insights into the thinking of the Chinese political leadership about how it views legal institutions, including the courts. It appears to treat the SPC as just another Party/state institution whose functions, internal institutions, and personnel the Party must set (the jargon in Chinese is the “three sets”(“三定”)(职能配置、内设机构和人员编制). It also shows the bureaucratic nature (官本位) of the SPC.  The bianzhi system illustrates that the SPC has a different role in the Chinese political system from the supreme courts of other major jurisdictions. This discussion and other ongoing discussions within the SPC on its “three sets” plan illustrates how the Party is reshaping legal institutions in the New Era. The Supreme People’s Procuratorate (SPP) has already been reshaped. This is part of the post-18th Party Congress (and 19th Party Congress) reshaping of Party and state institutions, to ensure the correct implementation of Party leadership.

The bianzhi system

The bianzhi system is a system for creating and eliminating Party/government/state-owned enterprise/institutional posts by identifying the necessary functions the system needs to fulfill. Those in the SPC are part of the government (政务) civil service/Party/government) system.  The bianzhi system is administered by the Central Staffing Commission. The Central Staffing Commission has an office (常设办事机构) that administers staffing matters, and it, in turn, is administered by the Party’s Organization Department.  Those whose posts are within the bianzhi system have civil service benefits and are said to “eat imperial grain.” (More scholarship on the bianzhi system can be found here and here). I should mention, however, that since 1982 the bianzhi system has given those in the political-legal institutions special status and special (专项) bianzhi. In 2015, the Central Staffing Commission issued a document on reforming the treatment of political-legal staff, including judges, which I mentioned in my 2019 article on transparency.

As to why the SPC Party Group discussed bianzhi in March, 2020, it is linked to new regulations on bianzhi work issued by the political leadership in August, 2019 (中国共产党机构编制工作条例) and apparently ongoing work on reshaping the internal institutions of the SPC, linked to those new regulations. (For those interested in cross-straits comparisons, please see analogous legislation from Taiwan.

In 2018, the SPC and the Central Staffing Commission issued regulations on the bianzhi of the lower courts, and some of the same principles in those regulations can be expected to applied when the SPC draws up its own “three-set” plan.  Those regulations were intended to control the number of internal institutions within a court, allocate more personnel to operational divisions, and standardize the functions and titles of internal institutions across provinces and nationally.  From my informal discussions with leaders in some busy local courts, they say that relying on bianzhi staff does not give them enough personnel to run their court, and contract staff are needed.

The principles for bianzhi work, as highlighted in the 2019 regulations are: 1) Upholding Party leadership over bianzhi work, the Party shall exercise centralized and unified leadership over bianzhi work, upholding and protecting General Secretary Xi Jinping as the core…( 坚持党管机构编制。坚持党对机构编制工作的集中统一领导,坚决维护习近平总书记党中央的核心); high quality in coordination with efficiency; the binding nature (like steel) of bianzhi (坚持机构编制刚性约束); and bianzhi must be slim and healthy.

The press report only vaguely hints on what the reshaping of the SPC will look like. President Zhou Qiang mentions a “trial centered” internal institutional model and personnel model, strengthening internal responsibility and operational matters, to ensure that the people’s courts can fulfill the demands of their responsibilities according to law.  Whether this means that more headcount will be allocated to the operational divisions of the SPC rather than the General Office and other administrative offices is unclear.  Whether it means that some of the smaller divisions of the SPC will shrink further is unclear. And whether it means that fewer people will be “borrowed,” I have my grave doubts.

Another unknown is whether the SPC’s “three sets” plan will be made available to the general public.  My guess is no (some approved plans are posted on the Central Staffing Commission’s website), but we are likely to see President Zhou Qiang issue a press release or discuss it at a news conference, as Chief Procurator Zhang Jun did last year, but not for some time.

A fundamental question not raised by the reports, but perhaps was in the minds of the participants in the meeting, is whether the bianzhi system, implementing the above principles, is consistent with some of the  SPC’s policy goals. One that comes to mind is being able to accommodate changes in where personnel is needed–a policy of rigidly enforcing bianzhi restrictions would be unhelpful.  After all, SPC leaders need to be “problem-oriented” (坚持问题导向), that is address relevant practical issues facing the court system as well as being politically correct, so that may mean that headcount needs to shift among divisions from time to time.

 

Supreme People’s Court updates its Belt & Road policies

Screen Shot 2019-12-29 at 9.15.50 PMAt a press conference on 27 December (2019) the Supreme People’s Court’s (SPC) #4 Civil Division (the division focusing on cross-border commercial issues) announced it had issued three documents: a judicial interpretation and two judicial policy documents. The documents are connected directly or indirectly to the Belt & Road Initiative (BRI) and improving China’s foreign investment environment.

  1. Interpretation on Several Issues Regarding the Application of the “People’s Republic of China Foreign Investment Law” (FIL Interpretation) (最高人民法院关于适用〈中华人民共和国外商投资法〉若干问题的解释);
  2. Opinion on providing services and guarantees for the Belt & Road (BRI Opinion #2) (关于人民法院进一步为“一带一路”建设提供司法服务和保障的意见); and
  3. Opinion on providing services and guarantees for Construction of the Lingang area of the Shanghai Pilot Free Trade Zone (Lingang FTZ Opinion) (关于人民法院为中国(上海)自由贸易试验区临港新片区建设提供司法服务和保障的意见).

The two Opinions update two of the SPC’s two major policy documents on cross-border issues: the 2015 Opinion on Providing Services and Guarantees for the Belt & Road (BRI Opinion, and Opinion on Providing Guarantees for the Building of Pilot Free Trade Zones (FTZ Opinion). Policy documents do not have the force of law. They are examples of how the SPC supports the Party and government by issuing documents to support important strategies or initiatives (serving the greater situation (服务大局). In the New Era, the SPC has issued over dozen policy documents that provide “judicial services and guarantees” for major government strategies or initiatives, many more than before.  These Opinions are intended to harmonize the two earlier policy documents with post 19th Party Congress developments and priorities, including those mentioned in the Fourth Plenum Decision. I had previously reviewed the two earlier documents in detail.  My analysis of the Pilot FTZ Opinion can be found here and I have previously written and spoken about the BRI Opinion.  This blogpost draws on correspondence I had recently with Professor Vivienne Bathof the University of Sydney, but I am solely responsible for the views expressed here.  This blogpost discusses BRI Opinion #2.

2.  Belt & Road Opinion #2

This document is longer than the other two put together and has much more substantive and political content. Comments on the first section will focus on the political issues, while comments on the rest of the document will discuss the other content in the document:

  • political signaling on discrete issues;
  • judicial policy changes;
  • signaling to various audiences;
  • instructions and guidance to the lower courts;
  • highlighting future possible changes to SPC positions on legal issues;
  • promoting or supporting certain government initiatives within the courts;
  • reiterating basic policies.

New requirements and tasks (Section 1)

In keeping with post 19th Party Congress trends and the spirit of the 2019 Political-Legal  Work conference, BRI Opinion #2 has more politically oriented content and references than the 2015 BRI Opinion. As it must be harmonized with the latest Party and government policy, it includes the latest judicial policy jargon, such as “improving the business environment” and “creating an international, law-based and convenient business environment with stability, fairness, transparency, and predictability.”

The first section includes a long paragraph on working principles. For the casual reader, the principles are an odd hotpot of political, substantive, procedural, and administrative matters but in keeping with its role in the document. It is all about political signaling. To the person unfamiliar with these documents, it gives the reader the impression that if she put her chopsticks in one place in the hotpot, she would pull up support for international arbitration and if in another, support for constructing litigation service centers.

Policy changes and signaling (section 2)

This section contains seven apparently unconnected provisions. They are linked by their political and practical importance: judicial cooperation in criminal law; protecting the right of domestic and cross-border parties; supporting multilateralism; supporting the development of international logistics; supporting opening up in the financial sector; supporting the development of information technology, intellectual property, and green development. This section is a combination of signaling to the political authorities and the lower courts.

One notable provision is on judicial cooperation in the area of criminal law. Article 4 mentions the Beijing Initiative for the Clean Silk Road, and zero tolerance for corruption.  Doing something about cross-border corruption offenses is not a matter primarily of the SPC, as this analysis notes and has greater implications for state-owned enterprises (SOEs). This provision calls for the people’s courts to work with the judicial organs of other countries and regions along the “Belt and Road” to build jointly a judicial anti-terrorism mechanism, and curb the spreading of terrorism.  The link to the SPC is that we can anticipate that some staff from the SPC would be involved in negotiating regional or bilateral arrangements relevant to anti-terrorism (along with the Ministry of Foreign Affairs and Public Security Ministry). In an indirect way, it illustrates how the SPC works with other Party and government departments on legal issues, one of the distinctive functions of the SPC that rarely receives much attention.

On signaling to the lower courts, in addition to the section on financial cases, discussed in the previous blogpost, Article 6 is a reminder to the lower courts to apply the relevant rules of determining contract validity and liabilities in civil and commercial cases involving free trade agreements or cooperation documents signed between China and other countries. In any case, it is their obligation in applying relevant law.  Perhaps the SPC has issued the reminder because lower courts have failed to do too often.

Although Article 11 (on environmental protection) has received attention from a prominent environmental lawyer who saw the inclusion of cross-border environmental public interest litigation in the Opinion as ground-breaking, knowledgeable persons suggested it is a merely a reminder to local courts that they can take such cases provided current legal requirements are met, such as jurisdiction over the defendant, location of the pollution, and the social organization meeting specified requirements.

Specific policy (Section 3)

Section 3 contains signals on changes to specific judicial policies, reminders to the lower courts and also political signals, including highlighting SPC accomplishments. Article 13 signals to the lower courts some new policy on contract interpretation. It addresses situations that commonly arise when one party alleges fraud or collusion to avoid contract liability. The SPC reminds lower courts that evidence should be reviewed carefully, and the evidentiary standard should be beyond a reasonable doubt(根据排除合理怀疑的证据规则严格认定欺诈、恶意串通).  Article 13 directs courts to apply foreign law if the choice of foreign law would uphold contract validity.

This section has quite a few reminders to the lower courts to do what they should already be doing, such as: actively applying international conventions applicable to China; respecting international practices and international commercial rules; fully respecting parties’ governing law choice and explaining how they determined it; taking a restrictive approach towards declaring contracts invalid. Governing law is a sore spot in certain maritime matters, where the Chinese courts in a number of cases have set aside parties’ choice of law for a failure to have an actual connection.

Extending the influence of Chinese law abroad is a policy that received new impetus in the November, 2019 Decision of the 4th Plenum of the 19th Party Central Committee, and therefore it is found in Article 20 and again in Article 21 (in the following section).  Linked to this is language on increasing the prestige of the Chinese courts and the China International Commercial Court in particular. The language echoes and extends the 4th Plenum of the 18th Party Central Committee and BRI #1 Opinion, by calling on the people’s courts to extend the influence of Chinese law, publish typical cases tried by Chinese courts in multiple languages, lay a solid foundation for courts and arbitration institutions to correctly understand and apply Chinese laws, and strengthen the understanding and trust of international businesses of Chinese law. From the fact that the SPC envisions Chinese courts as having a role in assisting foreign courts and arbitration institutions to “correctly understand and apply Chinese law” shows that the SPC has a distinctive understanding of the role of a court.

On related accomplishments, one relates to typical cases in foreign languages and the other to the creation of the foreign law ascertainment platform. In 2019, the SPC published typical cases on cross-border issues in English, by publishing a pair of books on China Foreign-Related Commercial Cases and Maritime Cases (in China). It has also published a book of Chinese cases translated into English through Springer. On foreign law ascertainment, the accomplishment is the SPC having established a bilingual foreign law ascertainment platform, that assembles in one platform the available resources for ascertaining foreign law and a number of cases that involve ascertaining foreign law. There has been discussion in China as to whether courts should take such an active role in ascertaining foreign law, but the SPC has made a policy decision that it should.

International Commercial Court and One-Stop Dispute Resolution (Sections 4 and 5)

The BRI Opinion #2 contains several provisions related to the China International Commercial Court (CICC), with some mention of its expert committee.  Article 23 mentions working with international commercial courts outside of China to establish various types of exchanges and cooperation, including training judges. It is unclear whether this a reference to increasing cooperation under the Standing International Forum of Commercial Courts or other future initiatives.

These two sections also signals to the lower courts policy changes and policies to be stressed. One policy to be noted is implementing the policy of mediating first (贯彻调解优先原则), which is already incorporated into the CICC rules.  Some of the difficulties in mediating cross-border disputes involving state-owned enterprises were discussed in this earlier blogpost and at the workshop on implementing the Singapore Mediation Convention that I attended in December (2019).

Some new developments underway are mentioned in this section, linking to the central government’s policy of supporting Hong Kong’s role as an international dispute resolution center. Article 34 calls for support for increased cooperation with the Hong Kong International Arbitration Centre and other Hong Kong-based arbitration institutions, and appropriately involving Hong Kong-based institutions in CICC’s one-stop model. Article 35 mentions supporting offshore arbitration institutions being able to hear cases in China. (a development underway in recent months).

An important practical issue is raised in Article 31, which mentions improving the mechanism of coordinating cross-border bankruptcy (insolvency), and exploring (探索) applying the systems of the principal bankruptcy procedures and the center of the debtor’s main interests. This is likely linked to domestic development of bankruptcy law and the recognition that with BRI and thousands of Chinese companies investing abroad, some number will (or have) gone into bankruptcy (insolvency) proceedings. “Improving” and “exploring” mean that they are on the agenda of the SPC. It appears that the first related development occurred in Hong Kong in January 2020, when Judge Jonathan Harris granted recognition and assistance to mainland liquidators of CEFC (description of the case and link to judgment found here).  He concluded his judgment by stating” the extent to which greater assistance should be provided to Mainland administrators in the future will have to be decided on a case by case basis and the development of recognition is likely to be influenced by the extent to which the court is satisfied that the Mainland, like Hong Kong, promotes a unitary approach to transnational insolvencies.”

As I discussed in a recent blogpost and earlier, the SPC is seeking to use the CICC and its decisions (judgments/rulings) to guide the lower courts and to pilot reforms that are replicable (a Chinese judicial reform concept), as stated in Article 22 and 25: “the role of cases in determining rules and guiding behavior…and the role of the CICC in providing models and guidance shall be developed.  (发挥国际商事法庭示范引领作用…发挥好案例的规则确定 和行为指引作用).

Article 24 concerns presumptive reciprocity and mentions gradually promote reciprocity between commercial courts. This may signal that the judicial interpretation on enforcement of foreign court judgments is further delayed and that the SPC is taking a gradual approach by working towards mutual recognition and enforcement of international commercial court judgments, which would involve a smaller group of foreign judgments.

Themes that are not new in this section include supporting parties’ right to choose an appropriate dispute resolution forum.  It can be imagined that the #4 Civil Division judges considered that this basic principle needed repeating. Another ongoing theme, with more political coloration, is encouraging BRI dispute resolution, including investor-state dispute resolution to be heard in China. This is mentioned explicitly in Article 28, which lists measures “so that more international commercial disputes can be efficiently resolved in China.”  This is not new, but is part of a push that this blog noted as early as 2016, to move the locus of China-related dispute resolution from London and other centers in Europe (or elsewhere) to China, where Chinese parties will encounter a more familiar dispute resolution system.

Article 32 mentions investment dispute resolution, and supporting “relevant departments in improving international investment dispute resolution mechanisms and organizations, respecting the dispute resolution clauses in bilateral and multilateral investment agreements, and resolving international investment disputes in a fair and efficient manner.”  This appears to be an acknowledgment that the SPC is in discussions with the Ministry of Foreign Affairs and other institutions on dealing with difficult issues related to enforcing international investment dispute arbitration awards in China (discussed here).

Personnel & Institutional Matters

The concluding section includes a notice in Article 37 to the lower courts that they shall “strengthen and improve the mechanism of coordination and guidance, and step up communication and cooperation with the relevant entities and departments.” This is a theme seen in many of the opinions issued by the SPC and reflects one of the many functions of the Chinese courts.

As discussed in the preceding blogpost, references in Article 38 and 39 to exchanges and training send signals within the SPC and its institutions, as well as lower courts about the types of programs that may be promoted, permitted or explored. It is likely that the National Judges College, its provincial branches, and its partners will continue to train foreign judges, as has expanded greatly in recent years. It appears that there could be greater possibilities for Chinese judges to go on exchange with other countries than has been possible in recent years. From my own contacts and experience with It may also provide the basis for a local court or division of the SPC to apply for funding to hold a legal roundtable or host an international exchange.

Concluding remarks

This Opinion is typical of New Era SPC policy documents providing guarantees and support for specific Party and government strategies and initiatives.  For a reader from outside the Chinese government system (体制), it takes knowledge of a constellation of related policies and practices to decode. This blogpost has been able to identify some of them.

BRI Opinion #2 has a great deal of content, not all discussed in this blogpost. Some have practical importance for practitioners in China and elsewhere.  But a larger question to consider, that likely was not in minds of the drafters, is whether this type of policy-oriented document is useful in reassuring foreign governments, foreign state-owned companies, and commercial entities that their dispute is best heard in China?  From my discussions with practitioners in various parts of the world, they may not be aware that BRI Opinion #2 even exists.

 

 

 

 

How are Supreme People’s Court Opinions structured?

Screen Shot 2019-12-29 at 9.15.50 PM
27 December SPC Press conference:from left, Li Guangyu (spokesperson); Justice Luo Dongchuan (vice president); Judge Wang Shumei (head of #4 Civil Division); Gao Xiaoli (deputy head, #4 Civil Division)

When the Supreme People’s Court (SPC) issues an “opinion” (意见), it is not issuing a judgment or ruling.  It is issuing a policy document, without the force of law.  In the New Era, the SPC has issued over dozen policy documents that provide “judicial services and guarantees” for major government strategies or initiatives, many more than before. They are examples of how the SPC supports the Party and government by issuing policy documents to support important strategies or initiatives (serving the greater situation (服务大局). What few, if any have written about is the structure of these opinions that support important strategies or initiatives as they relate to civil and commercial law issues. Understanding the structure is key to understanding the documents. Understanding opinions is important for understanding current issues in the courts and the future direction of judicial policy.

This blogpost uses the two opinions announced at the 27 December 2019 press conference pictured above, at which Justice Luo Dongchuan and Judges Wang Shumei and Gao Xiaoli (head and deputy head of the #4 Civil Division) introduced the two opinions (and a judicial interpretation). A subsequent blogpost will highlight what is new in these three documents. All three are connected directly or indirectly to the Belt & Road Initiative (BRI) and improving China’s foreign investment environment. The two opinions are:

  1. Opinion on providing services and guarantees for the Belt & Road (2) (BRI Opinion #2) (关于人民法院进一步为“一带一路”建设提供司法服务和保障的意见); and
  2. Opinion on Providing Services and Guarantees for Construction of the Lingang area of the Shanghai Pilot Free Trade Zone (Lingang FTZ Opinion) (关于人民法院为中国(上海)自由贸易试验区临港新片区建设提供司法服务和保障的意见).

The Opinions update two of the SPC’s two major recent policy documents on cross-border issues: the 2015 Opinion on Providing Services and Guarantees for the Belt & Road (BRI Opinion, and Opinion on Providing Guarantees for the Building of Pilot Free Trade Zones (FTZ Opinion).

The BRI Opinion #2 and Lingang FTZ Opinion are intended to harmonize the two earlier policy documents with post 19th Party Congress developments and priorities, including those mentioned in the  2019 19th Party Central Committee Fourth Plenum Decision. I had previously reviewed the BRI Opinion and FTZ Opinions in detail.  My analysis of the Pilot FTZ Opinion can be found here and I have previously written and spoken about the BRI Opinion.

Lower courts may issue documents that supplement the SPC’s policy documents, as is true with these Opinions.  This is a subject that I have written about on this blog and elsewhere before. The Shanghai Higher People’s Court has already issued a guidance document that provides related services and guarantees, with important content.

The two Opinions also link to three different events or matters–the promulgation of the Foreign Investment Law; the Second Belt & Road Forum for International Cooperation; and Xi Jinping’s visit to Shanghai and establishment of the Lingang Special Area of the Shanghai FTZ.

Structure of these Opinions

The structure of the two opinions is typical for SPC civil and commercial opinions “providing judicial services and guarantees” for major government strategies and initiatives.  Opinions often (but not always) start out with a first section with titles analogous to the section titles of these two Opinions:

I. Comprehensively grasping the new requirements and new tasks in serving the “Belt and Road” Initiative

I. Enhance understanding and get aligned with the mission of offering judicial services and guarantees to the New Area

A sample of the language of the first section is quoted below, from the second paragraph of the BRI Opinion #2:

Keeping committed to the concept of further providing judicial services and
guarantees by the people’s courts for the “Belt and Road” Initiative: The people’s courts shall firmly take the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guideline; study and fulfill the spirit of the 19th CPC National Congress and the Second, Third, and Fourth Plenary Sessions of the 19th CPC Central Committee, as well as the essence of the key speech of General Secretary Xi Jinping on the Second Belt and Road Forum for International Cooperation; strengthen consciousness of the need to maintain political integrity, think in big-picture terms, follow the leadership core, and keep in alignment…

The purpose of this initial section is two-fold. The first is to notify the lower courts of the political goals, background, and principles of the Opinion. The second to signal to the political-legal hierarchy that the policies that the SPC sets out in the body of the opinion are harmonized with the latest Party/government policies.

There are no hard and fast rules concerning the body of opinions, as analogous sections may occur in different order.  It may depend on the drafters and the topic involved.

The second section of the BRI Opinion has its counterpart in the third section of the Lingang FTZ Opinion:

II. Further performing the role of judicial trials, and serving and guaranteeing the joint construction of the “Belt and Road” with high quality in all aspects

III. Strengthen judicial trial function and maintain an institutional regime in the New Area focusing on investments/trade liberalization

These sections are meant to notify the lower courts about current relevant judicial policy, and implicitly inform them of any changes from previous policy and what the lower courts must do in support of that policy goal. The policies are likely to be linked to current Party/government policy.  From the BRI Opinion #2:

The people’s courts shall support the opening-up policy in the financial sector; the exemplary role (示范作用) of financial courts shall be maximized; eligible courts shall be encouraged to build special trial teams for financial cases; the application of law in foreign-related financial cases shall be further regulated and standardized;…valuable experiences of foreign countries in efficiently hearing financial cases shall be drawn upon…

Article 10, in Section III of the Lingang FTZ Opinion calls for

closer ties and communication mechanisms with the financial regulatory authorities shall be built to facilitate the construction of an integrated and efficient financial management system, in a bid for a better environment for doing business, for prevention of financial risks and for better national financial security.

In support of the opening-up policy in the financial sector, the SPC is promoting the role of financial courts (currently Shanghai, others to follow) in providing new mechanisms or methods in hearing cases or in their operations.  That is visible from the Shanghai Financial Court’s innovations in class actions in the sphere of securities law claims (claims against issuers, underwriters, directors and management, control parties, etc. for false and misleading disclosure upon initial issuance or in periodic reporting).  The Shenzhen intermediate court has established a special trial team for financial cases but not a separate court. From Article 10 of the Lingang FTZ Opinion, it can be anticipated that the Shanghai Financial Court has or will establish special communication channels with the financial regulators.

The titles of the third section of the BRI Opinion #2 is:

III . Further improving the application of law in cases involving the Belt and Road Initiative, and building a stronger rule-based business environment that is governed by law

From BRI Opinion #2:

13. The people’s courts shall vigorously carry forward the contract spirit and the good faith principle, and determine the acts of fraud and malicious collusion based on the rules of evidence beyond a reasonable doubt. If, in a civil or commercial case involving the construction, operation, purchasing, or bidding process of a project, there is a discrepancy on contract validity between the laws of the relevant countries, the people’s courts shall apply the law that holds the contract valid without damaging the honest party or benefiting the dishonest one, and promote mutual trust and benefits between the participants in the Belt and Road Initiative.

Each article in the third section of the BRI Opinion #2 focuses on a specific policy that the SPC wants the lower courts to promote.  In article 13, the SPC is seeking to control the tendency of lower courts to find a contract invalid because of allegations of fraud or malicious collusion, likely made by a Chinese litigant seeking to avoid contractual liability.  The Lingang FTZ Opinion does not have an exact counterpart to section III of the BRI Opinion #2, but has articles that focus on specific policies to be promoted, such as “properly handling cross-border bankruptcy cases….”

The title of the final section of BRI Opinion # 2 is:

VI. Further strengthening the organizational structure and team building to coordinate efforts to serve and guarantee the Belt and Road Initiative.

The last section relates to institutional and personnel matters. Take the following paragraph in the BRI Opinion #2 as an example:

39. The role of international exchange and research platforms such as international forums, legal roundtables..shall be further strengthened, and the exchanges and cooperation with the judicial systems of other countries shall be conducted. Training and studying programs for foreign judges shall be supported, and foreign legal service providers and think-tanks for the Initiative shall be invited to China to exchange views with Chinese counterparts so as to promote the formation of a diverse and interactive platform for legal exchanges….

Content in the last paragraph of the Lingang FTZ Opinion has some analogous provisions:

Establish a study training program and talent cultivation mechanism in line with international standards…Efforts shall be made to…(2) further expand international judicial communication channels, organize international judicial forums….

These provisions send signals within the SPC and its institutions, as well as lower courts about the types of programs that may be promoted, permitted or explored.  It is likely that the National Judges College, its provincial branches, and its partners will continue to train foreign judges, as has expanded greatly in recent years.  It appears that there could be greater possibilities for Chinese judges to go on exchange with other countries than has been possible in recent years.   It may also provide the basis for a local court or division of the SPC to apply for funding to hold a legal roundtable or host an international exchange. For the Lingang FTZ Opinion, it gives the Shanghai courts priority in organizing international programs and establishing programs to send outstanding young judges focusing on cross-border commercial issues on educational programs either in China or abroad.

The official report states that the SPC Party Group approved the two Opinions.  It appears from my previous research that pre-19th Party Congress, SPC policy documents did not necessarily require SPC Party Group approval. I surmise since the Party Political-Legal Work Regulations were promulgated in January 2019, it has now become a requirement, because Article 15 requires Party Groups/Committees to be responsible for setting major policies and directions.

______________________________

My thanks to a knowledgeable person for triggering my thinking about this and for insightful comments on an earlier draft.

Central Inspection Group gives feedback to the Supreme People’s Court (2020 edition)

Photo of CIG feedback meeting

In September, 2019, this blog reported that Central Inspection Group (CIG) #4 would inspect the work of the Supreme People’s Court (SPC) Party Group for approximately two months.  On 10 January 2020, Chinese media reported on CIG #4’s feedback to the SPC’s Party group. The summary and brief analysis below is based on the press release published in state media, rather than the full report given to the SPC.  Palpably better judicial transparency does not include Party documents of this nature. This process signals to the world outside of China that the SPC has a different role in the Chinese political system from the supreme courts of other major jurisdictions.

Chen Xi, Politburo Member, head of the Organization Department, and deputy head of the Leading Small Group on Central Inspections chaired the meeting. In the audience was: the head of the CIG #4 Group and its leader; members of the supervision office ( 监督检查室) of the CCDI/National Supervision Commission, leaders from relevant bureaus of the Party Organizational Department, leaders from the CCDI/Supervision Commission office stationed at the SPC, leaders of the SPC, and other responsible persons from the SPC. The results and the recommendations of what needs to be improved, as in 2017, were conveyed to the Standing Committee of the Politburo. The inspection group found that:

the study and implementation of Xi Jinping’s new era of socialist thinking with Chinese characteristics are not deep enough, the implementation of the Party’s line, direction, and policies and the Party’s central decision-making and deployment were not satisfactory.  There is insufficient focus on Party political construction;  the strengthening of political ideology and professional ethics of the cadre team (加强干部队伍思想政治和职业道德建设还不够到位) is not satisfactory; it insufficiently fulfills the duties and mission of the state’s highest judicial organ (履行国家最高审判机关职责使命还不够). The requirements of “justice for the people and fair justice” have not fully penetrated the entire court work process.   In every aspect, the trial management system and the supervision mechanism for the operation of judicial power are incomplete (各方面,审判管理体制和审判权力运行监督机制还不够健全完善). The strict implementation of the Party’s main responsibilities has not been put in place in a comprehensive manner, and minor problems are ignored; there are still problems with violations of the spirit of the Central Eight Point Regulations. There are still gaps in implementing the Party’s organizational policies for the New Era; leadership building and cadre construction are not in place. Party-building work of the institution and at the basic level is weak. Issues identified in the last inspection have not been corrected and corrective mechanisms are not in place.

In 2017, the CIG found: “four consciousnesses” need to be further strengthened; political discipline and political rules are not implemented strictly enough; the leadership role of the Party group is insufficiently developed;  there are some gaps in the coordination of the advancement of the system of judicial system reform; the implementation of responsibility system for ideological attitude (意识形态责任制落实不够有力); there are weak links in Party construction; organizational construction is not systematic enough; internal Party political life is not strict enough; relevance of ideological-political work is not strong; some Party leading cadres’ Party thinking is diluted (有的党员领导干部党的观念淡漠); the role of the basic level Party organization as a fighting fortress is insufficient; comprehensive strict governance of the Party is not strong, the implementation of the central eight-point regulations is not strict enough; formalism and bureaucratic issues still exist; tourism using public funds, abuse of allowances and subsidies still occurs; personnel selection is not standardized; cadre management is not strict enough; there are some areas of clean government risk.

This report revealed that some information involving leaders had been referred to the CCDI/National Supervision Commission, Party’s Organization Department, and other departments for further handling. The 2017 report contained similar language as well.

Chen Xi made demands of Zhou Qiang and other members of the SPC Party leadership. Among those is to implement the Party’s absolute leadership over the work of the courts, strengthen its “service and guarantees” to the work of the Party and state (see my 2019 article on one aspect), and implement judicial reforms. One of the demands he made with significant practical significance (flagged by a Wechat account popular among judges) is for measures for SPC judges (and likely lower court judges as well) that further restrict the employment of judges who have resigned and stricter conflict of interest rules for relatives of judges who are lawyers. [It is unclear whether these future measures will slow the resignation of SPC (or lower court) judges.]

He called upon the Party Group to raise their political position (提高政治站位) and arm their brains with Xi Jinping New Era Socialism with Chinese Characteristics thinking (用习近平新时代中国特色社会主义思想武装头脑–a current slogan, for those not aware of recent developments).

Comments

For the outside observer, handicapped by a limited ability to decode Party jargon, the summary of the feedback raises many questions but also provides insights.

Although the feedback appears to be devastating criticism of the SPC, a quick comparison to CIG feedback to the Supreme People’s Procuratorate and the Ministry of Justice indicates that the language (at least in the press reports) is standard for CIG feedback to Party and state institutions. It thus provides insights into the thinking of the political leadership about how it views the law and legal institutions, including the courts.  It appears to treat the SPC as just another Party/state institution to be inspected.

Part of current Party policy seeks to bolster domestic and international confidence in the SPC and the lower courts.  At the same time, this press release describes the SPC as insufficiently fulfilling the duties and mission of the state’s highest judicial organ, and that some of its operations are inadequate.  No specific examples are provided. What are the qualifications of the CIG members to make this decision and what type of evaluation mechanism have they used?  What will be the impact of this feedback within the institution, within the Chinese legal community, and on the views of people in and outside of China towards the SPC?

The feedback also reveals continuing concern about Party building, political ideology, the Party thinking of senior SPC personnel, and implementation of Party policy.  It can be seen from my recent blogpost that SPC leaders seek to craft their policies, actions, initiatives, and other decisions to hit the target of being politically correct (post 19th Party Congress and post 4th Plenum) while being “problem-oriented” (坚持问题导向) that is, addressing relevant practical issues facing the court system.  The practical issues facing the court system are primarily civil disputes. We do not have overall statistics for the number of cases in the Chinese courts in 2019, but if the Shenzhen courts are any indication, the number of cases they accepted increased by 24%, with most of the cases being civil or commercial disputes. That means a substantial part of the work of the SPC must be directed towards creating a framework for dispute resolution in which domestic (and international) civil and commercial litigants can have greater trust.

 

Challenges for Supreme People’s Court leaders in the new era

Screenshot 2019-12-21 at 2.07.48 PMOne of the little-discussed aspects of being in a leadership role in the Supreme People’s Court (SPC) in the New Era is ensuring that policies, actions, initiatives, and other decisions hit the target of being politically correct (post 19th Party Congress and post 4th Plenum) while being “problem-oriented” (坚持问题导向) that is, addressing relevant practical issues facing the court system.  This is true for President Zhou Qiang as well as the vice presidents (each of whom is responsible for several divisions (主管), according to bureaucratic principles), the division heads, deputy heads, and equivalents in the affiliated institutions of the SPC, whether they be the circuit courts, National Judges College, or the China Institute of Applied Jurisprudence (CIAJ).

After the recent Central Economic Work Conference, Party Secretary and President Zhou Qiang convened a meeting of the SPC’s Party Committee, to discuss the implications for the courts, all of which appear to be the major initiatives of the SPC.  I have added numbers and deleted some provisions (translation thanks to Google translate). He said:

We must:

  1. deepen the comprehensive supporting reforms of the judicial system;
  2. vigorously promote the construction of smart courts;
  3. continuously improve the quality and efficiency of court work, and create a stable, fair, transparent, and predictable business environment for the rule of law.
  4. continue to strengthen judicial protection of intellectual property rights and intellectual property rights;
  5. improve the rule of law environment that supports the development of private economy, implement comprehensive, legal, and equal protection of property rights, protect the legitimate rights and interests of private enterprises and entrepreneurs in accordance with the law, and allow entrepreneurs to concentrate on starting a business..and operating with peace of mind.
  6. It is necessary to increase the judicial protection of intellectual property rights and provide strong judicial services and guarantees for the implementation of the innovation-driven development strategy. It is necessary to serve to ensure the healthy and rapid development of the digital economy, handle the relationship between the protection of digital rights and the development of the digital economy, protect personal information in accordance with the law, properly handle legal issues related to the digital economy platform, and better serve and guarantee the development of the digital economy.
  7. …Strengthen research on new situations and issues in the economic and financial field; do a good job in financial and bankruptcy trials; and effectively improve capacity of the people’s courts in risk prevention and resolution.
  8.  …It is necessary to serve a high level of opening up to the outside world, strengthen foreign-related commercial and maritime trials, protect the legitimate rights and interests of Chinese and foreign parties on an equal basis in accordance with the law, and provide powerful judicial services and guarantees for a wider, wider, and deeper opening.
  9. It is necessary to severely punish crimes in accordance with the law, actively participate in the special struggle to combat crime and eliminate evil, resolutely safeguard national security and social stability….

So what more specific measures hit the target? They include the following:

  • In November, Vice President Luo Dongchuan, when he made comments at the SPC Intellectual Property Court (Tribunal) on establishing a diversified technical fact investigation mechanism–see the language  in the Chinese version of the article (“raise political stance, fully recognize the importance of establishing and perfecting a technical fact investigation mechanism 罗东川强调,要提高政治站位,充分认识建立健全多元化技术事实查明机制的重要意义);
  • In December, Vice President Jiang Bixin, said such measures included improving environmental protection of the Yellow River Basin and high-quality development;
  • In December, head of the administrative division, Judge Huang Yongwei (mentioned on this blog when he was president of the National Judges College), said it included the judicial interpretation on administrative agreements, which he characterized as “having a positive effect on effectively protecting the legitimate rights and interests of the people in administrative agreements, advancing the government of the rule of law, building a credible government, optimizing the rule of law to do business, improving the ability of government administration, and advancing administrative trials in the people’s courts.”
  • For Yang Yongqing, deputy head of the #2 Civil Division, and one of the drafters of the recently promulgated 9th Civil and Commercial Trial Work Conference Summary (draft discussed here, the Conference Summary to be discussed in a future blogpost) (and Cao Shibin, head of the CIAJ, it meant going to one of the provincial courts to give lectures on civil and commercial issues.  Judge Yang explained what the conference summary means for trying cases involving a company that has provided security to a third party, as well as cases involving applications for relief by third parties.  Cao spoke on “Ethics and Judgment -Application of Judicial Reasoning in Civil and Commercial Trial Work”, starting from the challenges and difficulties facing the profession of judges.
  • Jiang Huiling, vice president of the National Judges College (NJC), in charge since Judge Hu Yunteng has retired: in November he addressed what implementing the 4th Plenum decision means for the NJC: “continuously promoting the modernization of education and training systems and education and training capabilities. The NJC should effectively translate its efforts into practical actions to promote development, gather the wisdom of all faculty and staff, study and judge the situation, … study in-depth the implications of constructing an “international first-class judicial institution (建设‘国际一流司法学府’)” [the goal that President Zhou Qiang has set for the National Judges College in its new five-year plan).”

This critic will “stay out of the region of immediate practice” (quote of Matthew Arnold, see a screenshot of a caricature that was one of my (late) father’s favorites).

 

Screenshot 2019-12-21 at 4.00.11 PM

SPC Updates its Guidance on Judicial (Adjudication) Committees

2016 meeting of SPC judicial committee, to which NPC, CPCC representatives, and certain experts were invited

On 22 September the Supreme People’s Court (SPC) updated its guidance to the lower courts on judicial committees (关于健全完善人民法院审判委员会工作机制的意见). (also translated as “adjudication committees”) (审判委员会). For those new to this blog, these committees are made up of certain senior members of a court, and they have special decision-making authority, as detailed below. They decide cases that are too difficult or important for an individual judge or judicial panel to decide, to ensure the optimal substantive result (as seen from the institutional perspective of the courts).

The document is a policy document (explained here), as indicated by its document number 法发〔2019〕20号). Lower courts (and the specialized courts) can issue further detailed guidance, have in the past and will do so.  In 2010 the SPC issued guidance on judicial committees (2010 guidance), which I analyzed in this article, Reforming-judicial-committees.  The article includes some insights from a number of judges with whom I spoke at the time.  Reforming judicial committees has been on the SPC’s agenda since the prior round of judicial reforms, as my 2014 blogpost discusses. I predicted that reform would occur “in the medium term.”  There are is a great deal of writing about judicial committees in English and especially in Chinese.  My 2014 blogpost links to some of the English language research, and other insights about how judicial committees work can be found in Embedded Courts, the prize-winning book by NG Kwai Hang and He Xin.

The broad consensus on judicial committee reform can be seen in Articles 36-39 of the Organic Law of the People’s Courts, as amended in 2018 (2018 People’s Courts Law), but the 2019 guidance sets out more detailed rules.

This blogpost will highlight some of the issues that come to mind in a quick review.

A quick list of what is new follows:

  • There are some changes in the format of SPC Opinions (意见) so that it is usual for them to begin with a list of basic principles.
  • As to be expected, Party leadership and related principles are listed at the top of both the 2019 and 2010 guidance.  Both stress upholding Party leadership of the work of the people’s courts, with the 2019 guidance referring to “upholding the Party’s absolute leadership over the work of the people’s courts.”  This should not at all be surprising, as the phrase has been used repeatedly since the 2019 Political-Legal Work Conference. The Party Regulations on Political-Legal Work use the phrase “Party’s absolute leadership.” As I mentioned earlier this year, Li Ling (of the University of Vienna) sees this as indicating a complete and unambivalent severance from the judicial independence framework.
  • On membership of judicial committees, The 2018 People’s Courts Law and the new guidance retain the old system of having the court president and vice-presidents, but no longer requires division heads (庭长) to be members, but refers to “experienced”(资深) judges and to the possibility of having full-time members.  The  SPC already does this.  Justices Hu Yunteng, Liu Guixiang, Pei Xianding, and He Xiaorong are full-time members of the judicial committee, which gives them a bureaucratic rank equivalent to being an SPC vice president, with attendant privileges. It is likely that the Central Staffing Commission regulates the number of persons who can be SPC vice presidents.  Judging by the SPC website, some SPC judicial committee members are not SPC Party Group members, although of course there is some overlap.
  • Another innovation in the 2018 People’s Courts Law, repeated in the 2019 guidance, is having specialized judicial committees, to focus on more specialized issues, and to deal with the problem of having non-specialist judges making decisions on issues regarding which they are not familiar.  This provision consolidates ongoing practice in both the SPC and lower courts  My understanding is that the Shenzhen Intermediate Court was one of the earlier courts to establish specialist judicial committees.  The roots of this innovation lie in the 2004-2008 Second Judicial Reform Five Year Plan Outline. (This also illustrates the time it takes for some judicial reforms to be adopted.)
  • On the functions of judicial committees, new language mentions “sensitive, major, and difficult cases such as those involving national security, diplomacy, or social stability.”  That language is new as compared to the 2010 guidance.  It is not new to the SPC, as it appears in the SPC’s 2017 judicial responsibility regulations, about which I wrote.  I surmise that this is just spelling out what had been the general practice.   Most of the other functions are consistent with previous guidance.
  • The operational language is more detailed than before and gives a glimpse into the bureaucratic nature of the Chinese court system ( a collegial panel or single judge who thinks a case should go to the judicial committee  “submit an application and report it up to the court president for approval level by level; and where an application is not submitted, but the court president finds it necessary, they may request that the adjudication committee deliberate and make a decision. The language enabling a court president to designate a case for judicial committee discussion likely represents a consolidation of practice, rather than something new.
  • Other procedures in the operational section are new, reflecting the new institution of the professional judges committee and much more specific requirements concerning the content of the report that the judges are required to prepare for the judicial committee, including arguments by both/all parties, prosecution/defense counsel and a clear listing of the issues on the application of law that require discussion and decision by the adjudication committee, the opinions of the professional (presiding) judges meeting. In a clear signal about how the SPC sees the importance of case research, it also requires judges preparing these reports to search for similar or related cases.
  • The 2019 guidance requires judicial committee members with a conflict to recuse themselves  (the language is unclear about whether a party can apply to do that).  This is new, and reflects many years of criticism of the failure to have a recusal mechanism.
  • The 2019 guidance also imposes a quorum requirement on judicial committee meetings, both the plenary and specialized committee meetings. Certain outsiders (people’s congress delegates, scholars, etc) may attend, as well as the chief procurator at the same level or his delegate (this latter provision is not new).
  • Decisions are made by at least half of the members attending and dissenting opinions must be recorded in the case file. It does not mention that dissenting opinions will be mentioned in the judgment issued to the parties and the public. As before, the decision of the judicial committee is binding on the judge or judges who heard the case (principle of democratic centralism).
  •  The 2018 People’s Court Law and new guidance require the decision and reasoning in cases discussed by the adjudication committee to be disclosed in the judgment documents unless the law provides otherwise, so a significant step forward in judicial committee transparency.  The lack of judicial committee transparency had been criticized for many years.
  • Judicial committees at all levels of the courts are now required to create an audio or visual recording of the entire process of judicial committee meetings and keep them confidential. Judicial committee proceedings are required to be incorporated in a court’s caseflow management system. It is not clear from the guidance who or which entity would have access.
  • Those not involved in judicial committee proceedings (outside leaders, senior judges not involved) are forbidden from involving themselves in judicial committee proceedings.  If this didn’t happen in practice, it wouldn’t have been included in this guidance.
  • Similarly, the language in the 2019 rules on judicial committee members and other maintaining confidentiality and work discipline, and not leaking trial work secrets (I discuss this in my article published earlier this year.  If this didn’t happen in practice, it wouldn’t have been included in this guidance.

Although for many years proposals have been made to abolish the judicial committee, I have rarely heard anyone who has worked in the Chinese judicial system agree with that proposal.  It seems more likely that the SPC thinking is maintaining the judicial committee system is appropriate for China at this time, given the level of professionalism nationwide, the need to share/avoid responsibility for making difficult decisions, and the greater political environment.  This guidance appears to be designed to deal with some of the abuses of the judicial committee system, have greater (but not complete) transparency, incorporate new court institutions, and generally improve how the committees operate.

 

Central Inspection Group inspecting the Supreme People’s Court (again)

Screenshot 2019-09-11 at 8.45.00 AM
Mobilization meeting for the Central Inspection Group’s inspection of the SPC

This week the Supreme People’s Court’s (SPC’s ) media outlets are carrying this 10 September report of the Central Inspection Group (CIG) #4’s mobilization meeting to inspect the SPC’s Communist Party group.  The same group is also inspecting the Supreme People’s Procuratorate (SPP). Senior leaders (that with a bureaucratic rank of deputy bureau chief and above 副局级以上干部) of the SPC and its institutions attended in person (as well as related personnel). Those in the SPC’s six circuit courts  (巡回法庭) attended by videolink.  Zhao Fengtong is heading  (this English biography is outdated) the inspection group. He gave a speech at the mobilization meeting. President Zhou Qiang, who chaired the meeting, spoke as well. A search of Caixin’s website reveals that Zhao Fengtong has headed many such inspection groups. News of the inspection was announced on the Central Commission for Discipline Inspection (CCDI) website last week and other media outlets. The inspection is part of the current round of CIG inspections, which total 37 Party, government, and other entities.  A CIG group last inspected the SPC almost three years ago. The previous mobilization meeting and inspector results were previously mentioned on this blog.

The China Law Society (a mass (government-organized non-government organization)) and the Ministry of Justice are being inspected in this round of inspections. Each has held its own mobilization meeting.

The inspection appears to be one example of the strengthening of Party leadership in the SPC. The inspection appears to be linked to language in earlier documents to strengthen the leadership of the Communist Party (加强党的领导) and to strengthen Party political construction (党的政治建设).  The Party Center issued a document on political construction earlier this year.

The remarks that Zhao Fengtong made are consistent with the document on political construction. Some of the points that Zhao Fengtong and Zhou Qiang made are highlighted below (along with my brief comments in italics):

  • the SPC, as a central organ, assumes a major political responsibility and glorious historical mission (重大政治责任和历史使命).  This phrase is to be found in SPC policy documents supporting important government initiatives;
  • Inspections are political supervision and a comprehensive political examination of the implementation by the Party Group of a Central and national organ of its political responsibility and duties (巡视是政治监督,是对中央和国家机关党组织履行政治责任和职责使命情况的全面政治体检). The term “political inspection” appears to be used frequently since earlier this year–the report on the previous mobilization meeting did not use this term.
  • The focus is on inspecting how the SPC is implementing the Party line, direction and policies and the major decisions that the Party Center has announced (重点监督检查落实党的路线方针政策和党中央重大决策部署情况);
  • The inspection will search out political deviance (深入查找政治偏差).  This phrase is found in the document on political construction–“put efforts into discovering and correcting political deviation” (着力发现和纠正政治偏差).

President Zhou Qiang stated that the Party group fully supports the work of the inspection group, will correct the problems found, will not delay or blame.  He mentioned that the institution will combine support for the work of the inspection group with current work (要把配合做好巡视工作与抓好当前工作结合起来).  The SPC is a court, to whom the public looks for justice. Informal inquiries indicate that the SPC has an even larger civil and commercial caseload this year.  Although earlier this year it raised the minimum amount in dispute for cases that it will take, the current state of the economy means that the SPC is facing a large increase in civil/commercial disputes. Domestic cases have a six-month deadline for resolution, placing a great deal of pressure on judges to resolve them timely, either by encouraging settlement or issuing judgments (or rulings).  

As in the previous round, the CIG is inspecting the SPC for approximately two months. The inspection group has provided an email and telephone number for those wishing to provide further information.

Background on CIGs and how they operate can be found in a 2016 New York Times article (focusing on the Ministry of Public Security’s inspection) and this scholarly article by Professor Fu Hualing of the University of Hong Kong’s law faculty.

Signals from the Supreme People’s Court’s national civil/commercial trial work conference

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Justice Liu Guixiang in a photo from some years ago

During the first week of July,  the Supreme People’s Court (SPC) held its civil/commercial work conference (民商事工作会议), at which senior SPC and lower court leaders (and other leaders) gathered to hear about the latest SPC policies concerning civil and commercial cases.

As this blog has noted, most of the work of the Chinese courts involves civil and commercial disputes, not criminal cases. President Zhou Qiang gave an important speech which set the tone for the conference, but the one that the practitioners (judges and lawyers) are paying close attention is the keynote speech by Justice Liu Guixiang, full-time member of the SPC Judicial Committee and organizer of the conference. From the content of Justice Liu’s speech, it appears that the focus was domestic commercial cases.  For those who want to review the text in full, it is available here and here (the second version was published on the Wechat account Empire Lawyers (法客帝国)and includes an introduction and highlighting by the lawyer who has the account.) (The last conference was in December 2015.) This blogpost highlights some of the many issues his speech raises.

(For those not familiar with SPC work conferences, the description I provided 25 years ago remains accurate: “Another important way through which the [SPC] uses these meetings is to transmit central legal policy, unify court practices in accordance with such policy, and obtain an overview of current court practices and problems.”)

Justice Liu Guixiang is a senior member of the SPC and one of a relatively few senior judges who graduated from the University of International Business and Economics (UIBE) (formerly affiliated with the predecessor to the Ministry of Commerce (MOFCOM)) and so is familiar with cross-border issues in particular (and was earlier head of the #4 Civil Division, in charge of cross-border issues). He is well known to the international community. Justice Liu has been given responsibility for the SPC’s campaign to basically resolve enforcement difficulties within two or three years (as the former head of the Enforcement Bureau).  Because problems in the Chinese economy means that many more business deals in China are ending up as disputes in the Chinese courts, the SPC needs to signal to the lower courts how important issues should be handled and to the senior political leadership that the courts are supporting the Party and its core.

Justice Liu conveyed messages on two types of issues to two parts of the audience for his speech.  The two parts of his audience were (are) the political leadership and tens of thousands of judges involved with civil and commercial issues, as well as others in the court system.   The two types of issues are political issues and legal issues, both on substantive law and procedural law.  People outside of China might be tempted to dwell on the political messages (as this analysis does, as time doesn’t permit better analysis of the legal issues), but the messages on legal issues are those ones that will have the greatest impact on the court system and on practitioners. The speech will be reviewed, discussed, and used as the basis for further work in the court system, and attentive lawyers and in-house counsel know that the content of the speech will affect their litigation strategy and business. I’ve spotted one synopsis on the takeaways from the conference from one of Beijing’s prestigious law firms and more are following.

Political issues

The first part of his speech addressed political issues, but that part also includes some highlighting of critical legal issues. He states that politics is the most important. Justice Liu repeats some of the “innovative” language from January’s Political-Legal Work Conference that I mentioned in a blogpost earlier this year (with which his speech is harmonized).  “As a political and legal organ, the people’s court is first and foremost a political organ. It must put political construction in the first place and clearly talk politics” )人民法院作为政法机关,首先是政治机关,必须把政治建设摆在首位,旗帜鲜明讲政治 )(I was tested on the phrase “talk politics/讲政治“ recently by some persons in the system with a sense of humor).

Principle #1 (of four)–“To uphold the absolute leadership of the Party. The leadership of the Party is the fundamental requirement of socialism with Chinese characteristics, and it is the root and soul of the people’s court.”…However, “the erroneous thoughts of so-called “constitutionalism”, “separation of powers” and “judicial independence” of the West must be resolutely resisted. This is a major issue of political principle and we cannot be vaguely ambiguous.” One commentator noted that this principle is greater than any ordinary principle of law.

This language harkens back to that used by President Zhou Qiang in January 2017. Why this was included, when the audience would know these principles clearly?  Likely for senior political leadership to see that the courts are harmonized with the Center and to ensure that the Center knows that SPC leadership is doing everything to ensure court cadres (judges and other court officials) are as well.

Principle #2, serve the Party and the greater situation.

Justice Liu reminds his audience that “it is necessary to fully realize that there is no rule of law that does not have political positions or political views” (没有不具有政治立场、政治观点的法治). In civil and commercial trials, we must have a stable political stance, determine the political direction correctly, pay attention to the political effect, consider the political influence (impact), and be good at analyzing complicated issues from the perspective of politics, from the perspective of the fundamental interests of the people, and from the perspective of the overall economic and social development of the party and the country, integrate politics in civil and commercial trial work.” (在民商事审判中必须站稳政治立场,把准政治方向,注重政治效果,考虑政治影响,善于从政治角度从人民群众根本利益角度、从党和国家经济社会发展大局的角度分析处理错综复杂的民商事矛盾纠纷,把政治融入具体的民商事审判业务中.

Interestingly, he notes that the system of recording interference by senior court leaders and other Party/government leaders has not been effective, and this must be implemented as well as the judicial responsibility system (问题在于我们在审判实务中没有不折不扣地落实好,非法过问案件登记制度的功能没有得到有效发挥。必须采取有效措施把这项与司法责任制相配套的改革措施落到实处).  This appears to be a reflection of the concern of many judges that they will be held responsible for judicial decisions that they made because they were under pressure to do so from senior court officials or local officials.

American civil (and criminal) procedure law professors would be intrigued to know that “so-called long-arm jurisdiction” merited mention in Justice Liu’s speech (“Pay close attention to the United States’ all-around suppression in the fields of economy, politics, science and technology, etc. and the implementation of so-called ‘long-arm jurisdiction”‘to bring new challenges to our country’s judiciary;高度关注美国从经济、政治、科技等领域对我国进行全方位打压,实施所谓“长臂管辖”给我国司法带来的新挑战.

Justice Liu includes in this section several legal issues and highlights the way that Chinese judges should think when hearing cases:

When making judgments, we must fully consider the overall situation of economic and social development, political effects, and social effects.  When dealing with major and sensitive cases, we must pay attention [carefully listen] to the opinions of financial supervision departments, state-owned asset management departments, and social organizations such as  small and medium enterprise associations to accurately grasp the overall situation of social stability, social impact, and political impact. 我们在作出判断时,要充分考虑经济社会发展大局、政治效果、社会效果. 在处理重大敏感案件时,要注意听取金融监管部门、国有资产管理等部门以及中小企业协会等社会组织的意见,精确把握社会稳定大局、社会影响、政治影响。

Justice Liu called for more work on bankruptcy law, particularly strengthening coordination with government, resolving obstacles in bankruptcy liquidation and reorganization, and introduce judicial interpretations to deal with the legal issues. In order to prevent and resolve major risks, the people’s courts should issue judicial interpretations or judicial policies on issues such as bond defaults that directly affect financial security and social concerns, equity pledges of listed companies, and Internet lending.

He calls for deepening supply-side structural reform and promoting high-quality economic development; clearing out “zombie enterprises”; preventing financial risks, protecting the legitimate rights and interests of private enterprises, establishing a legalized business environment, and other civil and commercial matters, and mentions the “Fengqiao Experience,” but in relation to the 2018 SPC Joint Opinion with the China Securities Regulatory Commission on increasing diversified dispute resolution for securities disputes and a single dispute resolution platform linking litigation and other forms of dispute resolution.  He flags future work in using other forms of dispute resolution to resolve financial/securities disputes.

Legal issues

Substantive legal issues are the ones that have attracted the interest of judges and other legal professionals. Politics is also visible in the way that Judge Liu phrased his summary of the legal issues briefly noted below  (particularly his use of dialectical analysis, consistent with Party Center language). (This analysis will be expanded later as time permits). The issues that he is highlighting are the major ones, particularly regarding commercial issues.  He is providing the view of the SPC (likely drawing on the views of the #2 Civil Division, the division focusing on domestic commercial issues), and is signaling where Chinese courts are in disagreement and should conform.

As to why Chinese courts disagree or are unclear on these issues, and why this speech will unify courts’ approaches, it has to do with Chinese legislation and judicial interpretations. Judge Liu’s speech is a type of judicial policy document, in essence. As I mentioned in a recent blogpost, rules or policies included in SPC judicial policy documents may eventually be crystallized in SPC judicial interpretations and eventually codified in national law, but that process is slow and cannot meet the needs of the lower courts. The lower courts need to deal properly (politically and legally) with outstanding legal issues pending a more permanent stabilization of legal rules. This is true for judicial policy documents in all areas of the law, not only in commercial law.  Therefore Justice Liu used this conference to convey the SPC’s views:

  1.  He flags the issues where Chinese courts disagree: validity of external guarantees given by companies; the validity of a contract if a fake chop is used; scope of the security rights when a security contract and registrations are inconsistent; guarantee contracts linked to shareholding (让与担保); how to adjust damages, how to implement the right to terminate a contract (如公司对外担保的效力问题、盖假章合同的效力问题、合同约定与登记簿记载不一致的担保物权的范围问题、让与担保问题,甚至连违约金如何调整、解除权行使的条件等一些常见问题);
  2. Methodology–in trying difficult and new civil and commercial issues, judges should search for “similar cases” and determine whether prior cases have derived related principles.  This links with my recent blogpost flagging the SPC’s development of its case law system (with Chinese characteristics). Justice Liu does not use the word “precedent.” He directs judges to consider whether principles in prior cases are applicable, if not, reasons should be given, and if an old principle is to be reversed, reasons should be given and these should be discussed by either the specialized judges committee or judicial committee. He stresses what I had mentioned previously, that principles are needed on what the scope of “similar cases” are.
  3. On disputes involving Value Adjustment Mechanisms (VAMs), judges should seek to coordinate the conflicts of interest between investors, companies and creditors. and implement the principle of capital maintenance and the principle of protecting the legitimate rights and interests of creditors, and to balance the interests of investors, shareholders, the company, and its creditors;
  4. He repeats SPC policy on an old FAQ (frequently asked question)–what if a contract violates a local policy, normative document, or ministerial rule–should a court invalidate the contract? The answer is no, the court needs to consider whether there is a violation of public order (公共秩序), which he says is mostly seen in violations of law or State Council administrative regulations;
  5.  How to protect all types of entities equally and provide special protection to groups such as minority shareholders and financial consumers;
  6. He gives practical guidance to for judges grappling with a theoretical legal issue–how to understand the status of the relevant law when the General Principles of Civil Law (2017) is inconsistent with earlier legislation such as the 1986 General Principles of Civil Law,  the 1999 Contract Law, the Company Law (last amended in 2018). The new law supersedes inconsistent prior law, but if provisions of the 2017 law are inconsistent with the special part of the Contract Law, the Contract Law prevails (on the theory that specialized provisions prevail)
  7. Issues related to the validity of contracts, including contracts that never went into force,
  8. Corporate guarantees to third parties–an issue regarding which there has been a great deal of litigation and court rulings have varied widely,  He sets down some rules;
  9. How to correctly understand a provision of the Company Law Judicial Interpretation #2, that gives creditors the right to seek the liquidation of a company in certain circumstances;
  10. Private lending (particularly interest-related issues);
  11.  Issues related to a debtor or guarantor using company shares to secure an obligation, and the related rights of the company and its creditors, voting rights and rights to dividends in the company., and whether the creditor has a priority right. Justice Liu notes the law is silent on the validity of such agreements but the SPC takes the view that these agreements are valid, as long as no mandatory provisions of law are violated;
  12. Remedies for a third party–raising objections in enforcement proceedings, requests for retrial, and applying to proceedings.
  13. How to deal with cases with both civil and criminal aspects–if civil and criminal case involves the same facts, it should be referred for criminal investigation first, and if there is some dispute, it can be coordinated by the local political-legal committee.  The major issue in practice is how to determine whether “the same facts are involved.”  Justice Liu points his audience to several factors. This is also an old issue in the Chinese courts, but has taken on new importance now that the Chinese government is using criminal prosecution to deal with abuses in the financial system that affect the interests of consumers and investors.

Not said in Justice Liu’s speech is whether the broad substantive content will be reissued in a form more useful to frontline judges (and other members of the legal community).  If practice is any guide, that is likely we will see a conference summary (会议纪要)–the SPC issued a conference summary based on the 2015 conference 11 months after the conference itself, on one set of issues.

 

 

China’s new judicial reforms on case law & other guidance

Gazette of the Jiangsu Higher People’s Court

As mentioned in my earlier blogpost, the Supreme People’s Court issued the fifth judicial reform plan outline in February, of this year (2019), harmonized with the current focus on Party leadership. For people with the fortitude to decode Chinese official documents, some real content can be found in the document. One of those provisions is #26 and relates to the ongoing efforts of the SPC to implement greater uniformity and consistency in the way that the law is applied in the courts (the translation below is from Chinalawtranslate.com):

#26 Improve mechanisms for the uniform application of law. Strengthen and regulate work on judicial interpretations, complete mechanisms for researching, initiating, drafting, debating, reviewing, publishing, cleaning up, and canceling judicial interpretations, to improve centralized management and report review mechanisms. Improve the guiding cases system, complete mechanisms for reporting, selecting, publishing, assessing, and applying cases. Establish mechanisms for high people’s courts filing for the record trial guidance documents and reference cases. Complete mechanisms for connecting the work of case discussion by presiding judges and collegial panel deliberations, the compensation commission, and the judicial committee. Improve working mechanisms for mandatory searches and reporting of analogous cases and new types of case. (完善统一法律适用机制。 加强和规范司法解释工作,健全司法解释的调研、立项、起草、论证、审核、发布、清理和废止机制,完善归口管理和报备审查机制。完善指导性案例制度,健全案例报送、筛选、发布、评估和应用机制。建立高级人民法院审判指导文件和参考性案例的备案机制。健全主审法官会议与合议庭评议、赔偿委员会、审判委员会讨论案件的工作衔接机制。完善类案和新类型案件强制检索报告工作机制)

As for why the uniform application of law is an issue, the quick explanation is the drafting of Chinese legislation often leaves important issues unresolved and outsources to the SPC (and SPP for some issues) the hard job of drafting more detailed provisions. (see Chinalawtranslate.com for many examples and NPC_observer.com for insights about the legislative drafting process).  Comments about the role of case law are found below.

#26 mentions the following:

  • improving judicial interpretations;
  • improving the guiding case system;
  • establishing a system for higher people’s courts to record with the SPC their guiding-type documents and reference cases;
  • improving China’s case law system.

Judicial interpretations

The SPC regulations on judicial interpretation work date from 2007. Some later guidance on that topic was issued several years ago, but that guidance has not been made broadly available. So it appears that one signal that this provision is sending is that the 2007 regulations need to be updated. It appears likely that the SPC will harmonize the language in its rules with the 2015 Legislation Law. Other provisions are unclear. One guess (based on the SPC document on incorporating socialist core values into judicial interpretations) is that language about socialist core values will be incorporated into any amended rules on judicial interpretation work. The Supreme People’s Procuratorate (SPP) revised its rules on judicial interpretation work earlier this year, and it is possible that the SPC will harmonize some of the language in its rules with those of the SPP.

Another guess is that those rules will codify existing practices on drafting, discussions, etc.. As my blogpost (and recently published article) on the SPC’s Pilot Free Trade Zone Opinion details, the drafting process for judicial interpretations (and similar types of guidance) operates on the basis of long-standing practices. (My forthcoming article stuck in the academic publishing process has many more details on the drafting process for criminal procedure law interpretations).

This provision appears to be aimed at the SPC’s Research Office, which takes the lead in managing the judicial interpretation process and deals with ongoing criticism that the SPC allows inconsistent judicial interpretations to be issued. It is unclear whether the improvements mentioned will involve more public consultation than previously.

Guiding cases

I will leave detailed comments on how the guiding case system will be improved to others, as research by others (see Jeremy Daum’s article) tends to show that guiding cases are rarely cited. I surmise that the intent of the provision is to speed up the selection and approval process for guiding cases, as well as the use rate.

Local High Court Guidance

This language codifies the long-standing practice of local high courts issuing guiding rules applicable within their jurisdictions. As discussed in my article on judicial transparency, published earlier this year, senior legal scholar Li Buyun raised questions about the validity of local court guidance in his letter to the Legislative Affairs Commission of the National People’s Congress last year (2018). Article 104 of the Legislation Law forbids adjudication and procuratorate organs other than the
Supreme People’s Court and the Supreme People’s Procuratorate from making specific interpretations on the application of law. 2010 SPC guidance had normalized the long-term practice of higher people’s courts (and their equivalent in the specialized courts) in issuing documents, characterized as ‘”trial work documents” (审判业务文件) and issuing reference-type cases (参考性案例).

Evidence of the importance of the practice can be seen by the fact that leading law firms publish client alerts about important local court guidance. This provision calls for a filing for the record system (with the SPC) of higher court guidance and reference cases to be established. It is not clear whether this system (apparently intended to enable the SPC to monitor local guidance and reference cases better) will result in a system that provides greater transparency to these rules. I had noted varying transparency requirements for local court guidance in my article. The Gazette of the Jiangsu Higher People’s Court (pictured above) publishes its court guidance under the section “judicial documents” (司法文件). That Gazette also includes local reference cases, entitled reference cases (参考案例)。 Terminology for local reference cases is not consistent, with the Shanghai Higher People’s Court issuing cases with a referential nature (参考性案例).

Improving China’s Case Law System

I wrote about in greater length in this short academic article published in the Tsinghua China Law Review two years ago (and in this blogpost three years ago) on how non-guiding cases guide. This part of the #26 consolidates some of the provisions of previous judicial reform documents and signals that the SPC’s judicial reform office is focusing on how to provide better guidance to the lower courts on using non-guiding cases and other forms of guidance documents that are not judicial interpretations. One issue not specifically mentioned is the relative authority of guidance documents and judgments/rulings by courts. It is assumed that SPC decisions are more authoritative than lower court ones.

The first sentence addresses the use of other forms of case guidance and transforming this case guidance into written documents. The titles, authority, etc. of these guidance documents are likely to be settled over time. One type that I have observed is the specialized judges conference (专业法官会议)(mentioned in at least two 2017 SPC documents: Opinions on Putting a Judicial Responsibility System in Place and Improving Mechanisms for Trial Oversight and Management ;(Provisional) and the SPC’s Judicial Responsibility implementing opinion (最高人民法院司法责任制实施意见(试行)(Implementing Opinion), In these conferences, difficult issues are discussed and provided to the collegial panel involved, but the panel members are not bound by the views of the conferences. This academic study notes that it is a uniquely Chinese institution and has arisen because of judicial caution about deciding cases independently (可以说,专业法官会议是中国特色的法院内部向办案法官提供咨询意见的专门机构,是在走向审判独立的特殊过程中,对法官自由办案能力担心而产生的一种特殊组织), likely in the face of extensive and long term accountability for decisions.

Some portion of SPC specialized judges conference discussions has been consolidated in the form of documents, such as in the form of a conference/meeting summary (会议纪要).  The SPC’s #2 Civil Division (focusing on commercial issues) seems to be leading the way in publishing these meeting summaries–some of the summaries have been published in book form, also with updates published on the internet/Wechat–see this example.

The last sentence of #26 addresses the case law system. The increasing importance of non-guiding cases shows the strength of the case law system that the authorities rejected about 10 years ago. It is clear from Justice Hu Yunteng(currently president of the National Judicial College)’s recollections of the history of the case system with Chinese characteristics, that Judge Jiang Huiling, then his colleague at the China Institute for Applied Jurisprudence (and currently vice president of the National Judges College) had looked to jurisdictions outside of China to advocate that China establish a case law system (Justice Hu doesn’t specify whether Judge Jiang was looking to case law systems in civil or common law jurisdictions in the “West.”). Mark Jia (of Harvard Law School), in his 2016 article, cites Li Shichun of the Chinese Academy of Social Sciences to the effect that it was the NPC that opposed those seeking to establish a Chinese case law precedential system.
My understanding that the last sentence is intended requires judges handling a case to engage in similar case searches and to report on the results of those searches in certain circumstances (for example, to report on their search before the case is discussed in the specialized judges conference). My earlier blogpost discusses the 2018 document requiring prior case search.–the specific rules for prior case search are not yet in place. What should be searched is not entirely clear.  One knowledgeable person described prior case search as a tool for “catching valuable cases in the sea of cases.” My own understanding is that it will depend on the area of law.  It can be seen from the last blogpost the type of cases considered authoritive in criminal law, but the types of persuasive cases will differ in other areas of law. Prior case search is meant as a tool for the courts to apply the law more consistently (and consistent with the views of the SPC) (an ongoing goal of the SPC). It is also likely that new legal rules evolved in cases will eventually be crystalized in other forms of documentary guidance, be it local court guidance, an SPC policy document, or an SPC judicial interpretation.

On the topic of precedent, as I noted in my 2017 blogpost on the SPC’s implementing opinion on its judicial responsibility system, special approval within the SPC is required if a ruling in a case will be inconsistent with prior SPC rulings on the issue. It means that the SPC is seeking to improve the consistency of its judgments internally.

So it appears that we will be seeing further evolution over the next few years in the tools used by the Chinese courts to provide legal rules: judicial interpretations, guiding cases, local high court guidance and reference cases, other guiding documents, and prior cases, with many of these intended to strengthen the firm guiding hand of the SPC.

 

Signals in the 2019 Supreme People’s Court work report to the NPC

Screenshot 2019-04-19 at 8.49.37 AMI have spent some time decoding Supreme People’s Court (SPC) President Zhou Qiang’s March 2019 report to the National People’s Congress (NPC). As I explain below, it provides signals into how the Chinese courts are changing and may change in the post 19th Party Congress New Era.

This report is both different from and similar to previous reports. The major difference is linked to the 2019 Central Political-Legal Work Conference (at which Xi Jinping set out in his speech (重要讲话) his view of the New Era for political-legal work(新时代政法各项工作) and the accompanying Party regulations on Political-Legal Work.  As I explain below, the report is linked to other recent Party regulations, such as the Regulations on Requesting Instructions and Reporting on Major Matters (中国共产党重大事项请示报告条例)and Regulations on the Work of Selecting and Appointing Party and Government Cadres (党政领导干部选拔任用工作条例). Although the Regulations on Party Groups were only recently issued (15 April), Zhou Qiang must have been aware of their content when drafting his report. It is also likely that he was aware of the Regulations on the Evaluation of the Work of Party and Government Leading Cadres (党政领导干部考核工作条例), issued on 21 April. As I have written before on this blog, the SPC Court President’s work report must be harmonized with the latest stance on political-legal issues.

What is different?

What is different is greater emphasis on political study and Party leadership, although these are themes that found in many previous SPC court president reports.  The emphasis in this year’s report on political study is on Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era (习近平新时代中国特色社会主义思想) and Party leadership is on implementing the spirit of the 19th Party Congress  (党的十九大精神) and the January, 2019 Central Political-Legal Work Conference (全面贯…中央政法工作会议精神).

This emphasis shown by the first numbered section of the report.  It is entitled  “Deeply study and implement Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era and Uphold the Party’s Absolute Leadership [emphasis added] Over the Work of the People’s Courts (深入学习贯彻习近平新时代中国特色社会主义思想坚持党对人民法院工作的绝对领导).”  The phrase “uphold the Party’s absolute leadership over the work of the people’s courts” has been used repeatedly since the 2019 Political-Legal Work Conference.  The Party Regulations on Political-Legal Work (mentioned above) use the phrase “Party’s absolute leadership.”  Li Ling (of the University of Vienna) sees this as indicating a complete and unambivalent severance from the judicial independence framework. The report identifies the primary political task for the courts to be studying Xi Jinping Thought and the 19th Party Congress decision (坚持把学习贯彻习近平新时代中国特色社会主义思想和党的十九大精神作为首要政治任务), and it calls for related training for all  350,000 court personnel (深入开展大学习大研讨大培训,对全国法院35万名干警进行全员轮训).

This section also calls for the strict implementation of the [Party] system of reporting and seeking approval for major matters [also known as requests for instructions](严格落实重大事项请示报告制度)(the Party regulations on reporting and seeking approval for major matters(Chinese version here). Those regulations appear to be linked to the Political-Legal Work Conference but were not publicly issued until the end of February).  As mentioned in my recently published article, 1995 regulations on trial work secrets require requests for instructions and their responses in a case to be placed in the supplementary file. These supplementary files are classified as trial work secrets.  There has been significant criticism over many years of the system of requesting instructions/reporting and seeking approval (as I wrote 26 years ago!), and proposals even within the SPC for the system to be “proceduralized” or “judicialized.” Some  academics have called for abolishing it. For those who can read Chinese, I recommend Renmin University Professor Hou Meng’s 2011 article analyzing the system of seeking instructions. The second judicial reform plan (under the late SPC President Xiao Yang), called for reform to the system of reporting and seeking approval/request for instructions system. In a quick search I did of the SPC’s judgment database for the phrase “sought instructions from the higher court (请示上级法院), I found almost 350 that mentioned the phrase (although a certain proportion related to requesting the higher court to designate jurisdiction).

Another indication of the emphasis on Party leadership is found in the section of the report that relates to the courts’ tasks for 2019.  Section #5 of the court tasks refers to improving the quality of court personnel–“speed up the creation of a revolutionized, regularized, specialized, professionalized team, forge a high quality court team that the Party Center relies upon and the masses are satisfied with.”  As explained in an earlier blogpost, “revolutionized” signals absolute Party leadership  (五是加快推进队伍革命化、正规化、专业化、职业化建设,锻造党中央放心、人民群众满意的高素质法院队伍). This language is consistent with the 2019 Political-Legal Work Conference and President Zhou Qiang’s speech to implement the spirit of that Political-Legal Work Conference (note that similar language is found in Procurator-General  Zhang Jun’s report to the NPC).

As in previous years, most of Zhou Qiang’s report was devoted to the SPC’s and lower courts’ accomplishments in various substantive areas and providing selected statistics to support the narrative. Those statistics reveal that most of the cases heard in the Chinese courts are civil and commercial, not criminal.  My incomplete research on the caseload of the SPC comes to a similar conclusion.

What needs to be observed (for those of us focusing on Chinese court developments) is how these recent Party regulations will be integrated with court-related legislation–for example, how the Judges Law will be amended to reflect the latest political developments. [The Judges Law was promulgated on 23 April, a future blogpost will analyze its significance].

Other issues to be observed include the following questions.  What does increased emphasis on Party leadership and political study mean for the operation of the Chinese courts and the increasingly professional judges working within the Chinese court system? The 19th Party Congress report calls for strengthening and improving Party leadership over bodies of state power.   A late January 2019 Central Committee document on strengthening the Party’s political construction (中共中央关于加强党的政治建设的意见) states that the basic nature of various institutions, including the courts (called adjudication /trial organs 审判机关) ) is that they are political institutions (中央和地方各级人大机关、行政机关、政协机关、监察机关、审判机关、检察机关本质上都是政治机关). What does this designation mean for the operation of the courts?

One of the post 19th Party Congress changes that Zhou Qiang mentions is implementing the system of seeking instructions from the Party organization and superior Party organizations and strengthening the leadership role of the Party group in operational (substantive) work and Party construction  (加强对本单位业务工作和党的建设的领导). So what does this mean, for example, for the China International Commercial Court and the SPC’s Intellectual Property Court (and their elite judges), as well as the other SPC judges together dealing with almost 35,000 cases, retaining and attracting high quality legal professionals, particularly at the lower court level (this year’s report recognized that the resignation rate in some local courts is “severe”)? Most of the 28 million cases heard in the Chinese courts were heard at the local level.  What does this mean for confidence in the Chinese court system, be it on the part of the Chinese public, the Hong Kong, Macau, and Taiwan public, and the international public?  President Zhou Qiang’s report reveals that most of the cases in the Chinese courts involve civil and commercial disputes that for the most part arise between individuals or corporate entities (in 2018 9,017,000 first instance cases involved people’s livelihood, including 1,111,000 first instance employment, medical, pension, and consumer cases), and the courts heard 1,814,000 marriage and family cases. Will integrating socialist core values into judicial interpretations promote the rights of women, not to mention other groups whose rights have traditionally not been fully protected?

Screenshot 2019-04-22 at 10.48.42 AM
graphic from the SPC English language website