What to Expect in the Fifth Round of Judicial Reforms

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On July 24, the Chinese authorities held the first post-19th Party Congress national conference  on judicial reform in Shenzhen, entitled “Promoting Comprehensive Deepening of Judicial Reform.”  Holding the conference in Shenzhen is significant, because it is considered synonymous with reform and openness. The leaders on the podium in the photo above (members of the Leading Small Group on Judicial Reform) (all men), include:

  1. Secretary of the Central Political Legal Committee, Guo Shengkun (Guo);
  2. President of the Supreme People’s Court (SPC), Zhou Qiang;
  3. Chief Procurator General Zhang Jun;
  4. Central Military Commission Political Legal Committee Party Secretary;
  5. Minister of Public Security;
  6. Minister of State Security;
  7. Commander of the People’s Armed Police.

Attendees of the conference included the Party Secretaries of the Political Legal Committees of all provinces/autonomous regions/cities, and likely senior leaders from all of the systems.

Readers of this blog will not be surprised that comprehensive deepening of judicial reform was the subject of the conference as a December, 2017, blogpost flagged that the new phraseology is “deepen the reform of the judicial system with comprehensive integrated reforms” (深化司法体制改革综合配套改革) (and there is a significant overlap with some of the issues Judge Jiang mentioned). The language is found deep in Xi Jinping’s 19th Communist Party Congress Report.

The quick (and incomplete) summary below is of some of the court-related issues from the report of Guo’s speech at the conference that He Fan (head of the planning section of the SPC’s judicial reform office) posted on his Wechat public account.  He was one of the many attendees.   None of the analysis below (in italics) should be attributed to him.

It can be expected that the court-related issues will be incorporated into the next judicial reform plan outline. What is on the court-related reform list?  What issues remain unresolved?

  1. Strengthen and optimize Communist Party leadership, Scientifically position the responsibilities and boundaries of the Party Committee, Political and Legal Committee, strengthen functions such as overall coordination, planning and deployment, supervision and implementation.   This of course listed first.What does this mean in practice for judicial system and particularly the operation of the criminal justice system, such as the ongoing campaign against organized crime (see this earlier blogpost)? 
  2.  Clarify the functions of the four-level courts,–improve the SPC circuit courts’ working mechanism; establish the Shanghai Financial Court, steadily expand the Internet Court pilots; explore the deepening of the reform of cross-administrative district courts and procuratorates, and explore the establishment of a national-level intellectual property appeal hearing mechanism.

Developments have occurred on some of these. The Shanghai Circuit Court will start operations soon, with regulations on its jurisdiction just issued and well-regarded judges appointed to senior positions.  The mention of an intellectual property appeals court is significant, as that has been mentioned in earlier government documents and it is on the wish list of the intellectual property law community.  The cross-administrative district courts are mentioned in the previous court reform plan, with some pilot projects. On SPC’s circuit courts are taking on a greater percentage of the SPC’s cases, (as mentioned earlier on this blog) SPC judges work in the circuit courts while their families remain in Beijing, so at some personal cost to judges involved.

3.  Improve institutional management, promote a combination of flat management and professionalization, adhere to the simultaneous transformation of comprehensive and operational entities, and promote the return of judicial personnel to the front line.  As this blog has repeatedly mentioned (and He Xin/Kwai Hang Ng have detailed in their new book, Embedded Courts), Chinese courts (as courts and political/legal institutions) have large “comprehensive offices” (engaging in functions not directly related to judicial work).  A recent study of several courts in Zhejiang province published in an academic journal affiliated with the China Institute of Applied Jurisprudence detailed the percentages. With the reduction in the number of judges and the explosion in the number of cases, there is a great amount of pressure to allocate more judges to the “front line” of handling cases.  Judges with some measure of seniority inevitably have both administrative and judicial responsibilities.

4.  Improve the supervision management mechanism of the president and division chiefs, and standardize the functions of the judicial committee, the committee of court leaders, which has a number of functions, often serving to diffuse responsibility for difficult cases  (Embedded Courts has more insights on this, and this blog has an earlier post on proposed reforms and related problems). Improve the professional judges meeting (mentioned in last year’s SPC regulations, I hope to have something more to say on this in a later blogpost). Improve the disciplinary mechanism of judges. (It would be an improvement to have greater transparency on the results.) Accelerate the construction of an electronic file with the simultaneous generation of the case and the entire process online case handling system.  This has been an ongoing proposal.  Shenzhen is taking the lead with this. Also it would be an improvement to have greater transparency on cases filed.

6. On judicial “standardization” –improve reference to similar cases, case guidelines, the guiding case mechanisms, implement mandatory search system for similar cases and related cases. We will carry out an in-depth national judicial standardization inspections.  This is sending two signals–greater implementation of China’s case law system (as I have written about earlier), and the continued use of government/Party inspection campaigns (reflecting the administrative aspects of the Chinese courts).

7. Improve the  performance appraisal system. Scientifically set the performance appraisal indicator system for handling cases, and guide judicial personnel to handle more cases, handle cases quickly, and handle cases well. Use big data technology to accurately measure the quality of the case and strive for convincing results. The assessment results are used as an important basis for the level of salary, job promotion…This is an important and unresolved issue for the Chinese courts–how to appraise judges.  Outside of China, many scholars have written about this, including Carl Minzner, William Hurst & Jonathan Kinkel. A good deal of research has been done within the Chinese court system concerning this (see this summary of a report published earlier this year by a team of Guangdong Higher People’s Court judges–discussing how the “civil servant/administrative model” predominates and suggesting that China should be looking to other jurisdictions for models, as judicial evaluation is a worldwide issue.  Case closing percentages continues to be very important for Chinese judges.  Is big data technology the answer?  Is this consistent with encouraging judges to write more reasoned decisions?  This appears to signal  a continuation of the judge as factory worker system described in this blogpost

8. In the area of criminal law, and criminal procedure, there are mixed developments.  On the one hand, greater encouragement for using the plea bargaining with Chinese characteristics (please see Jeremy Daum’s deep dive into the pilots). The merging of the arrest and prosecution stages is also mentioned.  Guo also mentioned  measures to enable appointing defense counsel in death penalty cases, having full coverage of defense counsel in criminal cases (Jeremy Daum has comments also on the system of stationing lawyers in detention houses), requiring lawyers to represent petitioners in criminal collateral appeals cases, as well as greater use of live witnesses at trial。  The National Judges College academic journal Journal of Law Application just published an article by a Beijing Higher Court judge, reviewing the duty lawyer scheme, with analogous findings to Jeremy’s.

9.  For those interested in how the supervision commission is/will affect criminal cases, Guo mentions establishing a system for linking the supervision’s investigatory system with the criminal procedure system (said to improve the battle against corruption, the question is the extent to which individual rights are protected).

10.  On foreign related matters, Guo mentions innovating foreign-related work, and improving cooperation on international enforcement and judicial cooperation.  These continue to be difficult issues, with no likely resolution in sight, particularly criminal and also civil.  As I have mentioned before China is participating in the drafting of the Hague Convention on the Recognition and Enforcement of Foreign Judgment, but there are major inconsistencies between the provisions of the draft convention, and the Choice of Court Convention which China signed last September.

Guo highlights improving an initial appointment system for judges and procurators, expanding open recruitment so that talented people will be attracted to becoming and remain judges.  He calls for better coordination between the law schools and professional training, systems for provincial level appointment of judges (and procurators), with better policies on temporary appointment (挂职) (a system used for academics to work in the system for a period of one or two years, and judges/procurators from higher levels to work at the basic level or in a poorer area), exchanges, promotions, and resignation.

In his recommendations, Guo tips his hat to judicial (and procurator) dissatisfaction with status and pay with his statement “uphold resolving a combination of ideological and practical issues, motivate cadres and police to the greatest extent possible.” 坚持解决思想问题和解决实际问题相结合,最大限度调动政法干警积极性”-as this blog has reported, a combination of those issues, excessive work, and significant amounts of time allocated to “studying documents” has led younger experienced judges (and procurators) to decide to resign.

 

 

 

What’s on the Supreme People’s Court’s judicial interpretation agenda (II)?

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SPC General office document issuing the 2018 judicial interpretation plan

The Supreme People’s Court (SPC) has a yearly plan for drafting judicial interpretations, as set out in its 2007 regulations on judicial interpretation work , analogous to the National People’s Congress (NPC) and its legislative plans. Judicial interpretations, for those new to this blog, are binding on the SPC itself and the lower courts, and fill in some of the interstices of Chinese law (further explained here).

On 10 July, the SPC’s General Office issued the document above. It sets out a list of 48 judicial interpretation projects for 2018 (with several for 2019) for which the SPC judicial committee’s had given project initiation/approval (立项) designating one or more SPC divisions/offices with primary drafting responsibility (this process to be detailed in a forthcoming article).  It appears to be the first time this type of document was publicly released (please contact me with corrections).  If so, it is a concrete step in increasing the SPC’s transparency (addressed in part in one of my forthcoming academic articles). The projects, deadlines, and some brief comments (some longer than others) follow below.

(“Project initiation”/”project approval” is a procedure well-known to those of us who have been involved in foreign investment projects in China, where it involves approval from the planning authorities, primarily for infrastructure projects, but is an initial procedure used by regulatory authorities of all types, Party and state. For the SPC, it reflects one of the planned economy aspects of the way it operates.

The document classifies the 48 projects into three categories:

  1. 2018 year-end deadline;
  2. 2019 half-year deadline;
  3. 2019 deadline.

This post will discuss the projects in the second and third categories, the ones with deadlines in 2019.

From these we can see which projects are the highest priority and where the SPC sees gaping regulatory holes need to be filled, reflecting its political-legal priorities. Often specific issues have already been on the agenda of the relevant division of the SPC for some time before they have been officially been approved by the SPC’s judicial committee.

As discussed in my previous blogpost, several of the interpretations listed for 2018 have already been issued. It is unclear which other drafts will be made public for comment, as the 2007 regulations do not require it to do so. Making this list known may put some pressure on the SPC to undertake more public consultation.  Few if any interpretations in the area of criminal or criminal procedure law have been issued for public comment.

First half of 2019 deadline

  1. Standardizing the implementation of the death penalty (规范死刑执行).  Apparently this will focus on more setting out more detailed guidelines concerning how the death penalty is implemented, linked to the Criminal Procedure Law and the SPC’s interpretations of the Criminal Procedure Law.

This article on a legal website sets out the steps in implementation and notes that parading of the persons to be executed is prohibited (although this rule seems to be ignored in too many localities).  A recent scholarly article provides some detail (in Chinese). It is possible that 2008 regulations on suspension of the death penalty will be updated. Responsibility of the #1 Criminal Division.  Given the sensitivity of issues related to the death penalty, it is significant that the SPC leadership decided to make this list public, given that this interpretation is on the list.

2. Judicial interpretation on harboring and assisting a criminal.  These provisions occur in various parts of the Criminal Law and are also mentioned in the organized crime opinion discussed in this earlier blogpost.  Drafting responsibility of the #4 Criminal Division.

3.  Interpretation relating to the protection of heroes and martyrs.  With the incorporation of the protection of heroes and martyrs in the Civil Code and the passage of the Heroes and Martyrs Protection Law earlier this year, drafting of a related judicial interpretation was expected.  Responsibility of the #1 Civil Division.

4.Interpretation on technical investigators in litigation.  Responsibility of the #3 Civil Division) (IP Division).  I look forward to Mark Cohen’s further comments on this.

5. Interpretation on the recognition and enforcement of foreign court judgments.  This blog flagged this development last year.  Judge Shen Hongyu of the # 4 Civil Division, who wrote this article on issues related to the recognition and enforcement of foreign court judgments, is likely involved in the drafting.  Drafting responsibility of the #4 Civil Division.

6. Disputes over forestry rights, apparently an area with many disputes.  The Environmental and Natural Resources Division is responsible for drafting.

7.Regulations on responsible persons of administrative authorities responding to law suits, relating to new requirements in the amended Administrative Litigation Law. and the 2018 judicial interpretation of the Administrative Litigation Law. The Administrative Division is in charge of drafting.

8.Regulations on the consolidated review of normative documents in administrative cases.  The Administrative Division is in charge of drafting this.

9. Regulations on the consolidated hearing of administrative and civil disputes, apparently related to item #22 in the previous blogpost. Responsibility of the Administrative Division.

10.  Application of the criminal law to cases involving the organization of cheating on state examinations (linked to Amendment #9 to the Criminal Law). The Research Office is responsible for drafting.

11. Application of the criminal law to crimes involving network use and aiding persons in such crimes (cyber crimes).  This article discusses some of the issues. The Research Office is responsible for drafting this.

End 2019 deadline

  1. Jointly with the Supreme People’s Procuratorate, Interpretation on Certain Issues Related to the Application of Law in Criminal Cases of Dereliction of Duty (II), likely updating interpretation (I) in light of the anti-corruption campaign and the establishment of the National Supervision Commission.
  2. Interpretation on limiting commutation during the period of the suspension of death sentences.  See related research in English and Chinese. The #5 Criminal Division is responsible for this.
  3. Interpretation on the trial of labor disputes (V), likely dealing with some of the most pressing labor law issues facing the courts that are not covered by the preceding four interpretations or relevant legislation.   The #1 Civil Division is in charge of drafting.
  4. Regulations on maritime labor service contracts, likely connected with China’s accession to the 2006 Maritime Labor Convention and a large number of disputes in the maritime courts involving maritime labor service contracts.  The #4 Civil Division is in charge of drafting.
  5. Regulations on the hearing of administrative cases, likely filling in the procedural gaps in the Administrative Litigation Law and its judicial interpretation.  The Administrative Division is responsible for drafting this.
  6.  Personal information rights disputes judicial interpretation, linked to the Civil Code being drafted.  Implications for individuals and entities, domestic and foreign. Responsibility of the Research Office.
  7.  Amending (i.e. updating) the 2001 Provisions of the Supreme People’s Court on Certain Issues Concerning Application of Urging and Supervision Procedure, relating to the enforcement of payment orders by creditors.  Responsibility of the Research Office.

 

 

 

 

What’s on the Supreme People’s Court’s judicial interpretation agenda (I)?

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SPC General office document issuing the 2018 judicial interpretation plan

The Supreme People’s Court (SPC) has a yearly plan for drafting judicial interpretations, as set out in its 2007 regulations on judicial interpretation work  (I have not been able to locate a free translation, unfortunately), analogous to the National People’s Congress (NPC) and its legislative plans.  Judicial interpretations, for those new to this blog, are binding on the SPC itself and the lower courts, and fill in some of the interstices of Chinese law (further explained here).  On 10 July, the SPC’s General Office issued the document above. It sets out a list of 48 judicial interpretation projects for 2018 (with several for 2019).  The document details the projects for which the SPC judicial committee had given project initiation/approval (立项), designating one or more SPC divisions/offices with primary drafting responsibility (this process to be detailed in a forthcoming article).  It appears to be the first time this type of document was publicly released (please contact me with corrections).  If so, it is a concrete step in increasing the SPC’s transparency (addressed in part in one of my forthcoming academic articles). The projects, deadlines, and some brief comments (some longer than others) follow below.

(“Project initiation”/”project approval” is a procedure well-known to those of us who have been involved in foreign investment projects in China, where it involves approval from the planning authorities, primarily for infrastructure projects, but is an initial procedure used by regulatory authorities of all types, Party and state. For the SPC, it reflects one of the “planned economy” aspects of the way it operates.

The document classifies the 48 projects into three categories:

  1. 2018 year-end deadline;
  2. 2019 half-year deadline;
  3. 2019 deadline.

From these we can see which projects are the highest priority and where the SPC sees gaping regulatory holes that need to be filled, reflecting its political-legal priorities. Often specific issues have already been on the agenda of the relevant division of the SPC for some time before they have been officially been approved by the SPC’s judicial committee.

Several of the listed interpretations have already been issued.  The SPC has solicited public opinion at least one of these draft interpretations, and it is unclear which other drafts will be made public for comment, as the 2007 regulations do not require it to do so. Making this list known may put some pressure on the SPC to undertake more public consultation.

This post will discuss the projects in the first category only, with a follow-up post discussing the projects in the second and third categories.

30 projects with a 2018 year-end deadline

  1. Regulations on the jurisdiction of the Shanghai Financial Court.  The NPC Standing Committee decision required the SPC to do so and included some broad brush principles on the new court’s jurisdiction.  As the SPC has announced that the court will be inaugurated at the end of August,  this is likely to be the highest priority project.  The Case Filing Division is in charge.
  2. Regulations on pre-filing property protection provisional measures (关于办理诉前财产保全案件适用法律若干问题的解释 ), a type of pre-filing injunction.  These regulations are for non-intellectual property (IP) cases, as item 18 below addresses provisional measures in IP cases (in which a great deal of interest exists in the intellectual property rights community, as these order can affect a company’s business). The Case Filing Division is in charge.  These regulations could benefit from some market input.
  3. Interpretation with the Supreme People’s Procuratorate on the Handling of Cases of Corruption and Bribery (II), likely updating the 2016 interpretation to reflect the establishment and operation of the National Supervisory Commission and addressing issues that have arisen in practice.  Issues to be covered likely include ones discussed in issued #106 of Reference to Criminal Trial (the journal of the SPC’s five criminal divisions, mentioned here) .  The #3 Criminal Division is in charge of drafting, but it is likely that the supervision commission will be/is one of the institutions providing input.  As I have mentioned earlier, the SPC generally does not solicit public opinion when drafting criminal law judicial interpretations.
  4. Judicial interpretation on the handling of criminal cases of securities and futures market manipulation.  This is linked to the government’s crackdown on abuses in the financial sector (see this report on the increase in regulatory actions) and is linked to last summer’s Financial Work Conference. The #3 Criminal Division is responsible.  It is likely the China Securities Regulatory Commission will provide input during the drafting process.
  5. Judicial interpretation on the handling of cases involving the use of non-public information for trading (Article 180 of the Criminal Law). Guiding case #61 involved  this crime.  It is likely that the principle from the guiding case will be incorporated into this judicial interpretation, as frequently occurs.  Again linked to the crackdown on the financial sector and again, it is a task for the #3 Criminal Division.
  6. Judicial interpretation on the handling of underground banking (地下钱庄) cases.  Large amounts of money are being whisked out of China unofficially.  Linked again to the crackdown on the financial sector as well efforts to slow the outflow of funds from China, and likely the People’s Bank of Chin.  Again, a task for the #3 Criminal Division.
  7. Interpretation on challenges to enforcement procedures in civil cases, related to the campaign to basically resolve enforcement difficulties within two to three years.  Drafting this is a task for the #1 Civil Division.
  8. Interpretation on evidence in civil procedure.  Important for lawyers and litigants, domestic and foreign.  Drafting this is a task for the #1 Civil Division.
  9. Interpretation on civil cases involving food safety. Food safety is an area in which public interest cases are contemplated.  These cases have been politically sensitive.  Drafting this is a task for the #1 Civil Division.
  10. Interpretation on construction contracts (II). The initial interpretation dates back to 2004. These type of disputes generally involve a chain of interlocking contracts and often regulatory and labor issues. Some of the larger cases have been heard by the SPC. Drafting this is a task for the #1 Civil Division.
  11. Interpretation on the designation of bankruptcy administrators.  Issues surrounding bankruptcy administrators have been ongoing in the bankruptcy courts, as has been discussed in earlier blogposts. Drafting this is a task for the #2 Civil Division.
  12. Regulations on the consolidating the bankruptcy of company affiliates, again an area where regulation is insufficient, posing issues for bankruptcy judges (as has been discussed in earlier blogposts). Drafting this is a task for the #2 Civil Division.
  13. Regulations on the civil and commercial cases relating to bank cards.  The drafting of this interpretation has been underway for several years, with a draft issued for public comment in June.  There have been a large number of disputes in the courts involving bank cards.  Drafting this is a task for the #2 Civil Division.
  14. Interpretation on legal provisions relating to financial asset management companies acquiring, managing, and disposing of non-performing assets.  The legal infrastructure related to non-performing assets is inadequate, as has been pointed out by all participants, including judges. The Shenzhen Intermediate Court has run several symposia bringing together leading experts from the market.  Drafting this is a task for the #2 Civil Division.
  15. Interpretation on the trial of internet finance cases (civil aspects), as existing judicial interpretations inadequately address the issues facing the lower courts. Drafting this is a task for the #2 Civil Division.
  16. Judicial interpretation on the statute of limitations in the General Provisions of the Civil Code (just issued), which was the responsibility of the #1 and #2 Civil Divisions as well as the Research Office. The General Provisions changed the length of the statute of limitations.
  17. Judicial interpretation on administrative cases involving patent authorization and confirmation. It appears to be the counterpart in the patent area of a 2017 judicial interpretation relating to trademarks.  I look forward to “brother blogger” Mark Cohen’s further comments on this. Drafting this is a task for the #3 Civil Division.
  18. As mentioned above, pre-filing injunctions in intellectual property cases (知识产权纠纷诉前行为保全案件适用法律若干问题的解释 ), a type of pre-filing injunction.  There is great deal of interest in the intellectual property rights community concerning these injunctions, as these orders can affect a company’s business. I look forward to Mark Cohen’s further comments on this. Drafting this is a task for the #3 Civil Division.
  19. Regulations on issues relating to the International Commercial Court.  Those were the responsibility of the #4 Civil Division and the interpretation was issued at the end of June.  See the previous blogpost for further comments.
  20.  Regulations on the scope of environmental and natural resources cases, with drafting responsibility placed on the Environmental and Natural Resources Division. These relate to current government efforts to improve the environment.  I would anticipate that these would include provisions on cross-regional centralized jurisdiction, so that pressure from local government will be reduced. Several provinces have already introduced such guidelines.
  21. Interpretation on compensation for harm to the environment, also with drafting responsibility placed on the Environmental and Natural Resources Division.  This is related to an end 2017 Central Committee/State Council General Office document on reforming compensation for harm to the environment. Again, Drafting responsibility with the Environmental and Natural Resources Division.
  22. Regulations on the trial of administrative agreements.  There is a tension between the administrative and civil/commercial specialists, as reflected in the area of Public Private Partnerships  (PPPs)(see this earlier blogpost).  This has practical implications for both the domestic and foreign business community, as the government is seeking to expand the use of PPPs and avoid local government abuse of them.  Drafting responsibility with the Administrative Division and the Ministry of Finance is likely to be providing input.
  23. Regulations on administrative compensation cases, drafting responsibility with the Administrative Division.
  24. Interpretation related to agency issues in retrial (再审) cases.  With the many governance problems of Chinese companies, these issues frequently arise.  Drafting responsibility with the Judicial Supervision Division.
  25. Interpretation on the enforcement of notarized debt instruments.  Lenders often use this provision to seek more efficient enforcement.  This is related to the campaign to improve enforcement as well as government policy relating to the financial sector.  This research report by one of Beijing’s intermediate court shows that asset management companies are often the creditors and the large amounts of money are involved. Drafting responsibility with the Enforcement Bureau.
  26. Interpretation relating to the enforcement of cases involving company shareholding.  Given the complexities of shareholding in China, including the frequent use of nominee arrangements, these are difficult issues for judges to deal with.  See a recent presentation by one of the circuit court judges on this issue.  Drafting responsibility with the Enforcement Bureau.
  27.  Regulations on reference pricing when disposing of property.  This too is related to the enforcement campaign as well as efforts to clean up the enforcement divisions of the local courts by requiring more transparent procedures.
  28. Interpretation on the Handling of Cases of Crimes Disturbing the Administration of Credit Cards (II), updating the SPC’s 2009 interpretation, found here. Responsibility of the Research Office, which can coordinate with criminal divisions involved as well as interested authorities such as the China Banking Regulatory Commission.
  29. Interpretation on cases involving both civil and criminal issues.  This is a longstanding issue, and with the crackdown on the private lending sector, this has come to the fore.  Among the many issues include: if the defendant is criminally prosecuted first and assets are confiscated, how can affected borrowers or other parties  be compensated.  Drafting responsibility with the research office, likely involving several civil and criminal divisions.
  30. Regulations on the implementation of the People’s Assessors Law. As the law and the follow up SPC notice are too general for courts to implement, more detailed rules are needed.  The Political Department (it handles personnel related issues) and Research Office are involved in drafting.

See the next blogpost for a discussion of interpretation in the second and third categories.

 

 

 

Signals in Supreme People’s Court President Zhou Qiang’s 2018 report to NPC (part 2)

Screen Shot 2018-05-10 at 12.54.58 PMFor those with the ability (or at least the patience) to decode Supreme People’s Court (SPC) President Zhou Qiang’s March, 2018 report to the National People’s Congress, it provides insights into the Chinese courts, economy, and society, and of course politics.  This blogpost will address selected aspects of the second and third parts of the report because of competing time demands.

Report drafting

To most of the world, President Zhou Qiang’s reports to the National People’s Congress (NPC) differ little from year to year.  However to President Zhou Qiang and the team of people tasked with preparing a draft that would not be thrown back in their faces, the challenges in 2018 were more formidable than previously.  This year’s report needed to highlight the SPC’s achievements of the last five years, signal that its work in the next year is harmonized with the post-19th Party Congress New Era, and hit the right notes with NPC delegates, who have in the past voted against court reports in significant numbers.

According to this report, the drafting group, which started work in late October (after the 19th Party Congress),  and as anyone familiar with China today would expect, communicated through Wechat. The high stakes report meant that President Zhou Qiang summoned members for drafting sessions during the Chinese new year holiday. The group submitted 37 drafts to President Zhou Qiang and other senior leaders, and as this blog reported in previous years on this blog, senior court leaders traveled the country to seek the views of NPC delegates and many others.

This means (as I have written before, and I have discussed in greater detail in a forthcoming paper) that the statistics have been specially selected.

The summary below (part 2) is not comprehensive but provides some highlights. It signals that the work of the SPC is perfectly synchronized with national policy.

Judicial protection of human rights

The second section of the speech touched on correction and prevention of “mistaken cases,” a topic mentioned in previous NPC reports, and still an ongoing issue.  Over the past five years,  6747 criminal cases have been reopened and retried. Among the measures the report mentions is:

  • policy documents on preventing mistaken cases;
  • the courts implementing principles of evidence-based judgments; (note that China does not yet have detailed criminal evidence rules, but see Judge Yu Tongzhi‘s remarks at a high profile criminal evidence conference on 19-20 May for the latest thinking of the SPC’s criminal divisions)
  • “no conviction in case of doubt;” (most useful discussions of this are behind academic publishers’ paywalls);
  • strictly implementing the death penalty; (as mentioned in earlier blogposts, there have been calls within China to be more transparent on the numbers, but this  decision likely needs top-level clearance);
  • improving legal aid in criminal cases, piloting in some provinces (including Guangdong) full coverage at all levels; [note Art. 21 of these regulations reveal concern about lawyers stirring up troubles, with language similar to Ministry of Justice regulations (不得恶意炒作案件,对案件进行歪曲、有误导性的宣传和评论);

Courts serve economic policy goals

This section highlighted the SPC’s accomplishments in supporting national economic policy goals.  The statistics are all for the past five years. Many of these topics have been previously discussed on this blog:

  1. Commercial cases:  the Chinese courts heard 16,438,000 first instance cases (in the last five years), up almost 54%;
  2. the SPC promoted bankruptcy trials, including developing a national bankruptcy information platform (limited information available–related blogpost here); issued a policy document on transferring cases from enforcement proceedings to bankruptcy; dealt with zombie enterprises by hearing and closing 12,000 bankruptcy cases (over the last five years); issued a company law judicial interpretation; heard and closed 4,106.000 sales tcontracts and 1,320,000 real estate cases.
  3. The SPC served major economic strategies, through issuing 16 measures related to Chinese companies engaging in foreign trade and investment, and the Belt & Road. It established a coordination mechanism for the Beijing, Hebei, and Tianjin courts (blogpost here).  The northeastern courts have provided judicial services to the region’s rejuvenation (see previous blogposts on some of the many legal and social issues); Guangdong, Fujian, etc. courts have provided services to Free Trade Zones;
  4. In the area of finance-related cases, the courts have prevented and resolved financial risk (a concern of the day) by:
  • issuing a policy document on financial cases (post the 2017 Financial Work Conference, on the Monitor’s to-do list),
  • trying and closing 5,030,000 finance-related cases (including insurance, securities, and financial institution loans),
  • trying and closing 7,059,000 private lending cases, 152,000 internet finance cases;
  • struck at illegal fund-raising etc.  (no statistics).  Expect to see more cases in this area in 2018.

4. SPC has improved judicial protection of entrepreneur’s property rights by issuing 17 policy documents (the number may indicate the depth of the problem) (see related blogposts).

5. SPC has supported national innovation policy through issuing an outline on judicial intellectual property (IP) protection, hearing and closing 683,000 IP cases,  working on strategies to deal with the issue for both Chinese and foreign IP holders that in China, IP infringement is low cost but protecting IP rights is high cost, trying the Jordan case and the Huawei v. IDC case.

6.  In the area of environmental protection, the SPC has issued an interpretation on public interest litigation, and concluded 487,000 environmental civil cases, with 11,000 cases of compensation for ecological environmental damages, 1,383 cases of environmental public interest litigation initiated by the procuracy (one of my students is looking into this), and 252 environmental public interest litigation cases were filed by social organizations.

7. In foreign-related cases, the Chinese courts concluded 75,000 foreign-related commercial and civil cases (note they account for a tiny proportion of cases in the Chinese courts).  Although the SPC says that more and more foreign parties have agreed to settle disputes in the Chinese courts, Professor Vivienne Bath’s research has shown that foreign parties are often dragged into the Chinese courts because of principles in Chinese law leading to parallel proceedings.   The protection of “judicial sovereignty” has multiple implications (some explained in the linked article).  This year, after several years of drafting, the SPC has issued a set of three judicial interpretations on the judicial review of arbitration. Supporting the national strategy of increasing its maritime power, the Chinese courts have heard 72,000 maritime first instance cases.  The SPC describes the maritime courts as effectively safeguarding the country’s maritime security and judicial sovereignty.

9. On foreign judicial exchanges, the SPC has handled 15,000 international judicial assistance cases (in fact both Chinese and foreign practitioners complain about how long assistance takes); and the SPC has used international conferences to promote its international role, particularly vis a vis Belt & Road countries.

Signals in Supreme People’s Court President Zhou Qiang’s 2018 report to NPC (part 1)

Screen Shot 2018-05-10 at 12.54.58 PMFor those with the ability (or at least the patience) to decode Supreme People’s Court (SPC) President Zhou Qiang’s March, 2018 report to the National People’s Congress, it provides insights into the Chinese courts, economy, and society, and of course politics.  This blogpost will address selected aspects of the first part of the report because of competing time demands.

Report drafting

To most of the world, President Zhou Qiang’s reports to the National People’s Congress (NPC) differ little from year to year.  However to President Zhou Qiang and the team of people tasked with preparing a draft that would not be thrown back in their faces, the challenges in 2018 were more formidable than previously.  This year’s report needed to highlight the SPC’s achievements of the last five years, signal that its work in the next year is harmonized with the post-19th Party Congress New Era, and hit the right notes with NPC delegates, who have in the past voted against court reports in significant numbers.

According to this report, the drafting group, which started work in late October (after the 19th Party Congress),  and as anyone familiar with China today would expect, communicated through Wechat. The high stakes report meant that President Zhou Qiang summoned members for drafting sessions during the Chinese new year holiday. The group submitted 37 drafts to President Zhou Qiang and other senior leaders, and as this blog reported in previous years on this blog, senior court leaders traveled the country to seek the views of NPC delegates and many others.

This means (as I have written before, and I have discussed in greater detail in a forthcoming paper) that the statistics have been specially selected.

The summary below (part 1) is not comprehensive but provides some highlights.

Executive summary (SPC section)

The English language Xinhua report on Zhou Qiang report drew on the introductory section, which was an executive summary of the work of the courts in the last five years, but this section will focus on the summary of SPC’s accomplishments

The SPC heard about 82,383 cases and closed about 79,692 ones, up 60.6 percent and 58.8 percent over the previous five-year period respectively. Much of this caseload is attributable to the circuit courts. For those interested, SPC court hearings (that are being heard openly) are streamed or are saved in a video library on the SPC website: (http://tingshen.court.gov.cn/). (The Supreme People’s Monitor can be seen attending a hearing here).

As mentioned previously, some SPC proceedings, including capital punishment review  and review of lower court rulings not to enforce foreign or foreign-related arbitral awards, are not considered “court hearings.”)

According to a Xinhua report on 10 May, the six circuit courts of the Supreme People’s Court (SPC) accepted 2,922 (and concluded 1909) civil, administrative and criminal cases in the first three months of 2018, accounting for 67.2 percent of the total cases of these types accepted by the SPC.  It is possible to view circuit court hearings on-line on the SPC website.

A total of 8,355 petitions were handled by the circuit courts (in the first 3 months of 2018), accounting for 78.92 percent of petitions handled by the SPC. It is clear two of the goals of establishing the circuit courts (the SPC near your home (“家门口的最高法院”) are being achieved: 1)moving the hearing of many cases to the circuit courts; 2) moving the processing of most petitions to the circuit courts.  It is not clear from these statistics how many petitioners sought to petition the circuit courts (and SPC headquarters) –there are likely many more petitioners who visited than petitions accepted.  As was discussed earlier on this blog, the SPC is seeking to involve lawyers in the criminal petitioning (collateral appeals) process.

The SPC highlighted that in the past five years it had issued 119 judicial interpretations (some of which have been discussed on this blog, many translated by Chinalawtranslate.com) and issued 80 guiding cases (link to cases and analysis) (as Jeremy Daum has written, and Mark Cohen has also noted, the statistics show they are not often used by the courts), but did not release numbers on the other types of documents it had issued (this blog has discussed some of them) or the number of model cases or other cases issued by SPC divisions (this blog has recently focused on ones issued by the criminal divisions).

1. Criminal cases

As is usual, President Zhou Qiang discussed criminal cases first, the topics reflecting their political priority. A total of 6.07 million suspects were convicted in first instance trials of 5.49 million criminal cases. (During that period the Chinese courts heard almost 89 million cases, so criminal cases are clearly a small proportion of the cases heard.)

In keeping with the current political priorities, President Zhou Qiang said the courts “resolutely protect the nation’s political security, in particular the security of the state power and the political system.” Similar to last year, no statistics were given for the number of national security cases heard. He does mention the normative document the the SPC issued jointly with other authorities on religious extremism and terrorism (discussed here).

President Zhou Qiang then discusses corruption-related offenses, mentioning the  asset recovery interpretation discussed last year on this blog.  Thereafter he focuses on property and personal safety-related crimes, mentioning this year’s organized crime normative document (this blog discussed it earlier this year), as well as (among others) its accomplishments relating drug cases and medical violence.

He then discussed cases involving violence against women and children (130,000 cases over the past 5 years, food safety (42000) and environmental protection crimes (88,000), and telecommunications crime. Local court white papers have posted detailed statistics concerning many of these crimes (see a Ningbo court white paper on sexual assault cases against minors and a Shanghai district’s court white paper on environmental protection crimes).

In the concluding paragraph, President Zhou Qiang discusses SPC participation in comprehensive security management. President Zhou Qiang mentions implementing an additional responsibility system on judges of publicizing the law (普法).  This is further to a 2017 notice of the Central Committee and State Council’s General Offices Opinion on State Organs implementing “whoever enforces the law publicizes the law” law publicity responsibility system (关于实行国家机关“谁执法谁普法”普法责任制的意见) that imposes responsibility on state organs enforcing the law (administrative and justice) to publicize the law.  Judges are to use court documents, open hearings, circuit courts, streaming of court cases, and posting legal documents on-line to promote the use of cases to explain the law. It is clear that the SPC is taking the circuit court responsibility system seriously, as the SPC’s #2 Circuit Court has been posting a series of articles on its circuit visits around the Northeast (see here).  This adds somewhat to judges’ workload, but this type of responsibility is not as great a concern as the more general responsibility system.

 

 

 

 

Supreme People’s Court & the new campaign to “sweep away black & eliminate evil”

Screen Shot 2018-01-31 at 11.21.40 AMLast week, China announced the latest campaign to “sweep away black and eliminate evil,” saohei chu’e (扫黑除恶),“Concerning the Carrying Out of a Special Action to Sweep Away Black and Eliminate Evil” (关于开展扫黑除恶专项行动的通知) (full text not yet released) with Xinhua news reporting that it reflects it reflects the leadership’s  outlook on security and people-centered governance thought.  The Supreme People’s Court (SPC) is an integral part of the campaign and was one of the institutions (along with the Supreme People’s Procuratorate, Ministry of Public Security, and Ministry of Justice) that issued a guiding opinion (办理黑恶势力犯罪案件的指导意见) on how the campaign is to be carried out (text found here). As previously discussed on this blog (and in a forthcoming article), there is no transparency requirement for guiding opinions and other “judicial normative documents” that are not judicial interpretations.  What has been made transparent (in a quick dive into the Wechatosphere) is that the SPC is both clarifying the criminal law issues to the legal community and signalling through releasing typical cases and other actions that lower authorities should not use the campaign to confiscate the property of private entrepreneurs. But will other imperatives trump that signal?

  1. Clarifying the legal issues

Although the commentators in this Voice of America program weren’t aware of it, there is a body of (confusing) legislation, partially described in this book chapter (somewhat outdated).  The authoritative (because it is published by the five criminal divisions of the SPC)  Reference to Criminal Trial (刑事审判参考), had published a special issue (issue #107) on organized crime law last summer. (For those of us who read more quickly in English, the editors have helpfully compiled an English translation of the table of contents. (see below)

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In his 29 January Wechat posting on his 说刑品案 (“Speak About Criminal Law, Evaluate Cases”) Wechat account, its editor, Judge Yu Tongzhi (于同志), a judge in the #2 Criminal Division and one of the editors of Reference to Criminal Trial, set out 20 Q & A’s with guidance on the legal issues (derived from last summer’s issue).

Judge Yu described the posting as to “coordinate” (配合) with this campaign, but is the author’s way of saying that the law on these issues is confusing and all involved, whether they are judges, prosecutors, public security or defense lawyers need an authoritative steer through the forest of law, judicial interpretations, and other guidance.   As is apparent from the photo above, the guidance includes a 2015 conference summary on organized crime, guiding cases (指导案例)(not to confused with those guiding cases (指导性案例 issued by the SPC itself), authoritative commentary on the 2015 conference summary, major cases, and discussions by judges of difficult legal issues. The guidance posted often illustrates answers with examples from the guiding cases and cautions that standards should not be improperly expanded, such as the definition of a “gang member.”  He does not include a summary of the law on property seizure, the subject of one of the articles in issue #107.

Some of the organized crime legal issues are analogous to those in other jurisdictions and last year one of the SPC websites published a long article analyzing this area of law (and its problems), suggesting that China look to US RICO legislation.

The first of the 20 questions is:

  1. What’s the connection between the 2015 and 2009  conference summaries on organized crime?

Don’t be surprised if you haven’t heard of either conference summary, as neither one seems to have been incorporated in any of the major translation databases.  As to what conference summaries are, Conference summaries are what the SPC entitles “judicial normative documents”  (there are a number of titles for these) and often address new issues or areas of law in which the law is not settled.   “Conference summaries” are also a form of Communist Party/government document.

The relationship is addressed in the article on the application of the 2015 conference summary by several heads of SPC criminal divisions in issue #107.  Their view is that the two conference summaries should be read together, which the later one taken as an elaboration of the first, with newer provisions superseding the older ones.

The campaign & private entrepreneurs

The second signal that the SPC is sending is that the “sweep away black and eliminate evil” campaign should not be used to abuse private entrepreneurs.  On 30 January, the SPC issued seven typical cases on protecting private property rights and the rights of entrepreneurs, one of which involves a case that occurred during the 2008 “strike black” campaign.  As summarized in China Daily,  the Liaoning Public Security Department arrested Liu Hua and Liu Jie in a 2008 criminal investigation and seized 20 million yuan (about 3.16 million U.S. dollars) in funds from their company, Beipeng Real Estate Development Co. Ltd. in Shenyang. In 2014, a local court in Benxi convicted the two and the company of illegal occupation of farmland but exempted them from criminal punishment. Liaoning Public Security refused to return the seized funds and related financial documents were not returned.  SPC Vice President Tao Kaiyuan SPC Vice President Tao Kaiyuan acted as the chief judge, and the SPC’s State Compensation Committee ruled the Liaoning Public Security Department should return the funds with  interest. Judge Hu Yunteng and the  #2 Circuit Court  were involved in this as well. Company counsel’s detailed account of this case (highly recommended!) found here. Judge Zhu Heqing, Deputy head of the #3 Criminal Division, discussed in the article mentioned above in #107 the problems with the law and practice of property seizures, such as the lack of a definition of “organized crime related property” (涉黑财物) and related seizure procedures, as well as the lack of procedures to require the return of property improperly seized.

Some thoughts

As the document on implementing this campaign has not been released, we cannot know whether it includes performance targets that will lead local authorities to “round the usual suspects up.” What is apparent from the Wechat posting and much more from issue #107, is that the law is this area is unclear, lacks procedures for protecting the property of the entities involved (not to mention the entrepreneurs), and can be easily abused by local authorities.  As we know from the case above and other cases, entrepreneurs will then spend years seeking the return of their property.  The SPC must coordinate with this latest campaign while protecting the rights of entrepreneurs, and avoid a new set of mistaken cases.

 

 

 

 

Supreme People’s Court & Supreme Court Justice Roberts’ 2017 year-end report

download-2Chief Justice John Roberts of the United States Supreme Court may be surprised to learn that a translated version of his 2017 year-end report on the federal courts was recently published by the People’s Court Daily, as it has been for the past twelve years. It was republished by Wechat and Weibo sites affiliated with the Supreme People’s Court (SPC) and other prominent Wechat public accounts and legal websites. What significance does the report have?

The translators that bring the year-end reports to Chinese readers are Mr. Huang Bin (formerly of the SPC’s China Institute of Applied Jurisprudence and now of the National Judicial College, a former Yale Law School visiting scholar) and Ms. Yang Yi (China Institute of Applied Jurisprudence, a former Columbia Law School visiting scholar).

Two subjects in Justice Roberts’ 2017 report are likely to resonate with Chinese readers. The first is how the federal courts dealt with national disasters in 2017 (introductory comments in some of the Wechat versions mention that China has only scattered legislative provisions related to emergency measures for the courts). The second is sexual harassment and Justice Roberts’ request to the Director of the Administrative Office of the United States Courts to organize a working group to review the code of conduct for the federal judiciary, guidance to employees on issues of confidentiality and reporting of instances of misconduct, and rules for investigating and processing misconduct complaints.

The #Metoo movement has not yet explicitly affected the Chinese courts. However, it is likely that Chief Justice Roberts’ acknowledgment that existing rules and structures for dealing with sexual harassment complaints are inadequate that resonates with Chinese women judges and judicial support staff, who make an increasingly large percentage of the Chinese judiciary. It seems likely (confirmed by discrete inquiries) that sexual harassment occurs in Chinese courts as well.

More broadly, what relevance does Justice Robert’s report and others on the US federal and state judiciary have for the Chinese judiciary after the 19th Party Congress, when in October, 2017 Communist Party Central Committee policy on the training of judges and prosecutors lists first 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)? To the careful observer, the publication of these reports and other articles on specific issues in SPC publications means that the senior and lower levels of the Chinese courts have an ongoing interest in what the US federal and state courts are doing and look to commonalities and takeaways (despite the vast differences in the two systems).

Another example of the Chinese courts looking to commonalities with the US courts occurred earlier this month (January) when the China Institute of Applied Jurisprudence published a Chinese summary of the National Center for State Courts’ 2017 survey on public confidence in the state courts. The article appears to be a republication of an article previously published internally and reflects the concern of the Chinese judiciary with public trust.

The takeaways, that is referring to or borrowing foreign legal concepts or models to reform China’s judicial system remains politically sensitive. In Party General Secretary and President Xi Jinping’s 19th Party Congress speech, he called for the continuation of judicial reform:

We will carry out comprehensive and integrated reform of the judicial system and enforce judicial accountability in all respects, so that the people can see in every judicial case that justice is served.

 Earlier in 2017, when visiting the China University of Political Science and Law, Xi Jinping cautioned that Chinese legal reform does not mean wholesale adoption of foreign law and institutions:

China shall actively absorb and refer to successful legal practices worldwide, but they must be filtered, they must be selectively absorbed and transformed, they may not be swallowed whole and copied (对世界上的优秀法治文明成果,要积极吸收借鉴,也要加以甄别,有选择地吸收和转化,不能囫囵吞枣、照搬照抄).

What a careful observer notices from monitoring SPC media is that those involved with reform of discrete areas of Chinese legislation and judicial practice continue (in the pre/post 19th Party Congress era) to look at US federal/state law (and other foreign law) structures and practices, including: use of mediation in federal appeals cases; bankruptcy practicereform of Chinese nuclear safety legislation to broaden the scope of information released to the public, that is in specific areas that do not involve basic principles of the Chinese courts.

 

 

 

Judicial reform post-19th Party Congress

 

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Judge Jiang speaking at an academic conference

 

Senior Judge Jiang Huiling heads the Supreme People’s Court (SPC)’s China Institute of Applied Jurisprudence (the Institute). He recently published two articles in the Chinese legal and professional press (the first of which was published in the Central Political-Legal Committee’s (authoritative) Legal Daily) signaling the phraseology and goals for judicial reform after the 19th Party Congress. As the operation of the Chinese judiciary has an important impact both domestically and internationally (as well as in greater China), post-19th Party Congress judicial reform goals are important.

For those who are not familiar with the Institute, it is the SPC’s in-house think tank. The Institute works on a broad variety of issues, particularly those linked with judicial reforms. Like think tanks elsewhere in the world, the Institute trains post-doctorate fellows and has its own staff. Judge Jiang is among a group of senior judges at the SPC who combines an international perspective (he studied at the University of Montreal, and has been a visiting scholar at Yale Law School, University of Sydney, and Academia Sinica) with profound experience in and understanding about the Chinese court system and how it can be reformed, given its complex bureaucratic nature and the environment in which it operates.

From his articles, it is clear that the new phraseology is “deepen the reform of the judicial system with comprehensive integrated reforms” (深化司法体制改革综合配套改革). The language is found deep in Xi Jinping’s 19th Communist Party Congress Report.

Background for these further reforms

Judge Jiang mentioned that during the summer of 2017, the senior political leadership approved further judicial reform measures (including written instructions from Xi Jinping to the Central Political-Legal Committee, designating Shanghai to take the lead in piloting them, initiating a series of reforms from early November. The Outline of the 4th Five Year Judicial Reform Plan required Central approval for major reforms, so this approval should not be surprising.  The beginning of this round of judicial reforms was also first piloted in Shanghai, so piloting these further reforms in Shanghai (as further described in this report) is also to be expected and it seems likely that piloting of reforms will continue in other places.

Eleven further reforms & some comments

Judge Jiang sees these further reforms as intended to implement the previous judicial reforms and classifies them into eleven broad areas.  The SPC has undertaken research (designating lower courts to do so) in many of these areas (with the results to be released to the public in some form).  It appears that those designing judicial reforms have realized that many judicial reforms are linked to deeper issues relating to the Chinese system.

I summarize Judge Jiang’s list and add some of my own comments or queries in italics (which should not be attributed to him):

  1. Optimize how judicial power is allocated within the courts, including the authority to adjudicate and to administer, splitting enforcement authority from hearing cases, allocating authority within offices/divisions of the court, and reallocate the functions of higher and lower courts.  The way that courts have been administered has for many years followed the (traditional) Party/state administrative model.  Some reforms have been implemented in recent years, but it is unclear how much will it be possible to change this, given long-standing patterns of interaction within a court and between higher and lower courts, as well as current incentives/performance indicators.  This appears to be linked to point 19, 24, and other provisions of the Outline of the 4th Five Year Judicial Reform Plan .
  2. Reform judicial administration–what should the model be–centralized administration by the SPC or local administration by each court?  Judge Jiang suggests China could consider models already in place outside of China. This is linked to point 62 of the Outline of the 4th Five Year Judicial Reform Plan. 
  3. Improve personnel administration, such as selection of judges, retirement, rotation of positions, discipline/punishment, retirement/resignation, education/training, headcount administration, internal institutions, etc.  The current model derives from the principle of “the Party manages cadres”  and is linked to basic aspects of the Chinese system such as the official ranking system (官本位) and hukou (户口).  Many of the matters mentioned (such as resignation, discipline, selection and headcount administration) are now controlled or operated by Party institutions–what flexibility will there be for the courts to innovate?  The judicial reforms do anticipate a separate career track for judges (and prosecutors), but it is apparent that the “devil is in the details.”  If there is to be cross-jurisdictional rotation of positions, what happens to the schooling of dependents and other practical matters linked with the hukou [household registration] system? An increasing number of legal professionals and judges are women. What impact would a cross-jurisdictional rotation of positions have on women judges? How can lawyers and others outside the system be fit into the official ranking system?  Under the current system, more senior judges are senior cadres, often less involved with hearing cases because of their administrative responsibilities.  Will later retirement for judges mean more judges in the courtroom?  The retirement issue has been under discussion for some years–see this 2015 blogpost for further background.
  4. Reform the system of how judges are “cultivated” (法官养成机制), in particular, look to the practice of other civil law jurisdictions (including Taiwan) in establishing a two year judicial training system, rather than the current practice of entirely selecting judges from within and having them learn on the job, and increase training for serving judges. He mentions improving the system of recruiting lawyers and law professors to the judiciary. (This is related to points 50 and 52 of the Outline of the 4th Five Year Judicial Reform Plan. The two-year training program proposal had been mentioned by Huang Yongwei, president of the National Judicial College, over two years ago.  It is linked to judicial education policy documents issued to implement the 4th Five Year Judicial Reform Outline, highlighted in this 2015 blogpost).  What might be the content of this training program?  From the previous policy documents we know it will include ideological, ethical, and professional training, but what will that mean in practice?  There have been ongoing exchanges between the Chinese judiciary and the Singapore Judicial College–  will the “beneficial experience” of Chinese judges in Singapore have any effect on the Chinese model?
  5. Improve judicial evaluation, i.e. benchmarking of how the Chinese judiciary is doing.  Judge Jiang suggests looking to domestic analytical frameworks (by the China Academy of Social Sciences and others), as well as international ones, including the Global Framework for Court Excellence and the World Justice Project,  but says there are issues with data and disconnect with Chinese judicial reality.  This relates to point 51 and others in the 4th Five Year Judicial Reform Plan. Benchmarking judicial performance remains an ongoing issue, with most Chinese courts in campaign mode to achieve high case closing rates in the run-up to the New Year.
  6. Better use of technology in the judiciary, not only big data but also use of electronic files, judicial “artificial intelligence.” For lawyers involved in cross-border cases, query when this will also imply the use of apostilles rather than the current system of notarization and consularization, as well as a more timely integration of other Chinese court procedures with those prevalent in the outside world. Pilot projects are underway in some areas regarding electronic files.
  7. Improve litigation, including “trial-centered criminal justice reforms,” pre-trial procedures, more detailed evidence rules, separating petitioning from litigation, and the use of people’s assessors. Creating a “trial-centered criminal justice system” at the same time that expedited procedures/Chinese style plea bargaining is being promoted raises many related issues as was recently discussed at a recent conference that I attended, and separating petitioning from litigation requires improvement of legal aid to the poor and better procedures for considering litigation-related petitions (see these earlier blogposts).
  8. Improve the use of diversified dispute resolution, to involve resources from other social and national resources and the market to resolve disputes, leaving only those most appropriate to be resolved by the courts. This relates to point 46 of the Outline of the 4th Five Year Judicial Reform Plan and related measures described in a 2016 SPC policy document, described here.
  9. Speed up the formation of a legal profession, including reform to legal education, examinations, etc., which Judge Jiang sees as long-term issues.  From my own observations in the courts, remarks by serving judges, practicing lawyers, and interactions with recent Chinese law school graduates, reforms to legal education are needed, as is some flexibility in the career path for Chinese legal academics, which stresses a Ph.D. and academic achievements, rather than any experience outside academia.
  10. Establish a rule of law (法治) culture and environment.  This, of course, is critical. However, the difficulty of doing so was most recently illustrated in the recent clearing of “low end population” from Beijing and related legal analysis (such as this article, originally published on a Chinese scholarly site.
  11. Improve judicial administration generally, including methods of enforcing the law, legislative drafting, etc.  Reforms of a grander scale appear to this observer to be difficult to implement, particularly at this stage.

Finally, Judge Jiang says these are the broad outlines of judicial reform, but they are subject to adjustment along the way.

 

 

 

 

Supreme People’s Court gears up for 19th Party Congress

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As the days count down to the 19th Party Congress, all Party/government institutions are preparing for it, including the Supreme People’s Court (SPC). On 19 September, the SPC issued an emergency notice (pictured above), calling on the lower courts to strengthening law enforcement work to provide a good judicial environment for the holding of the 19th Party Congress.  The SPC, as other Party/government institutions, issue emergency notices from time to time (here’s one from the Ministry of Education), generally linked to a politically significant event. The full text for the SPC notice hasn’t been released (or if it has, it has escaped me). It is meant to send signals to the SPC staff and to the lower courts.

Some of the signals:

  • improve performance indicator systems (indicating too many courts still have dysfunctional performance indicators);
  • handle more cases, handle them well, handle them quickly (多办案、办好案、快办案, language better suited to the factory floor);
  • ensure that the goal of having  difficulties in enforcement basically resolved in three years is achieved (again….);
  • clear up those unresolved cases (要抓好长期未结案件清理,确保依法妥善清理案件)–this is being taken seriously by court leaders, again judges (and their clerks, assistants and interns). The PhDs (and Master’s degree holders) praised by the SPC may feel they are somewhere between a model production worker and a real judge (or clerk.). (Of the SPC quota judges, about 1/3 have PhDs, with over half holding a master’s degree), and PhDs are not unusual in the lower courts, at least in major cities.)  An unscientific survey shows judges and their support staff doing more overtime during the pre-19th Party Congress and pre-Golden Week holiday to meet this target;
  • reminds the lower courts about the case registration reform and reminds judges that cases should be accepted, even towards year end, when courts are concerned about their case closing numbers, especially the number of cases that will be carried over to the next year, and warns them against reporting false closing statistics  (坚决杜绝人为抬高立案门槛、拖延立案、年底前提前关门不收案等突出问题), (切实防止虚假报结、强迫撤诉);
  • reminds courts about another important but controversial judicial reform, implementing the judicial responsibility system (insightful analysis and research from within the courts on this is coming out, see this recent article in the National Judicial College’s journal);
  • it reminds judges of ways to deal with the increase and cases and reduction in headcount–use diversified dispute resolution, separate simple from complicated cases, and try similar cases together.

The SPC released some year to date (end August) statistics (I’m drilling down on the state of transparency in this area)–close to 16 million newly accepted cases (15.89 million), no breakdown on how cases are categorized, closed cases up to 12.67 million (up 15.7%). This indicates continued high pressure on first instance judges and their assistants. I’m awaiting data on what the vortex of reforms means for retaining high quality judges.

 

 

Supreme People’s Court ramps up its judicial responsibility system

Screen Shot 2017-08-12 at 7.04.09 AMIn April of this year (2017), the Supreme People’s Court (SPC) issued its judicial responsibility guidelines.  At the end of July, the SPC issued a 73 article implementing opinion (最高人民法院司法责任制实施意见(试行)(Implementing Opinion), which went into effect on 1 August 2017.  There have been many summary reports in the legal press, but the full text was not found until 11 August. 2017 It has since been published by several Wechat accounts, but as of this writing, no official text has been issued.  The policy basis for the responsibility system links back to the 3rd and 4th Plenum Decisions. Senior Party leadership (the Central Leading Group for Comprehensively Deepening Reforms) approved the SPC’s responsibility system.

The document establishes operating rules for the SPC  after this latest round of court reforms, and therefore sets guidelines for the lower courts. It can be expected that the lower courts will issue corresponding documents. Through the Implementing Opinion, it is possible to see how much autonomy an individual judge/three judge panel has and what matters require approval by senior SPC leaders.

Opinions (as this blog has previously explained) are not judicial interpretations but a type of judicial normative document.   A recent Wechat post by an SPC commercial subsidiary, Faxin (法信), described them as judicial guiding documents (司法指导性文件). That is the terminology being used for them in a series of books published by the People’s Court Press. Inconsistent legal terminology is not a new phenomenon.

The basic principles of the Implementing Opinion are said to implement central authorities’ requirements, let those who hear cases bear responsibility, clarify how cases are to be dealt with and put in place the Party group’s responsibility for enforcement (the phrase “Party group” actually is mentioned three times) and case handling. It appears that some provisions memorialize current practice, while others set out new rules.

The  Implementing Opinion specifies roles of different personnel and institutions within the SPC such as the court president (and vice presidents), heads of divisions, professional judges committee, judicial committee, presiding judges, judges in charge of cases, clerks, and judicial assistants. It provides guidelines on how cases are to dealt with, from case acceptance, random case assignment, to issuing decisions.

The Implementing Opinion includes the following (selected) provisions:

  • Details on staffing for judges (one assistant and one clerk in the circuit courts, and some assistants and clerks at headquarters) (Article 3);
  • those with a leadership role (President/vice president/vice/heads of divisions) should generally be the presiding judge (Article 5), while the judges in collegial panels should change every 2-5 years;
  • leaders need to hear cases, that are difficult/important/guiding, etc., but specialists are designated to assist them (Article 7);
  • rules on who will issue judgments, mentioning that the president of the SPC signs the  order for the implementation of the death penalty (this was understood to be the case already)(Article 11);
  • court leaders may not give oral/written instructions concerning a case (except as otherwise provided (i.e. cases that are considered by the judicial committee)(Article 12);
  • responsibilities of professional judges committees (a committee put into place under the judicial reforms); judicial committee (can be split into specialist civil, criminal, enforcement subcommittees) (role said to have narrowed, but include major/difficult cases affecting national interests & social stability, but also other non-case related duties such as approving judicial interpretations/judicial normative documents, etc., the judicial committees requires  views be stated in the judgment (Articles 16-19);
  • the basic rule is random case assignment, with exceptions for major/difficult cases (Article 26-27), with electronic service of process & documents if agreed (Article 32);
  • basic rule is online broadcast of SPC court hearings, unless approved by leaders otherwise (Article 33), with requirements concerning the posting of rulings/judgments and other transparency requirements mentioned in the document;
  • circuit courts are prohibited (in general) from considering requests for instructions (the rule makes sense–it would defeat one of the purposes of having circuit courts (Article 25, this is an example);
  •  Articles 41-43 relate to precedent case review (as suggested in my recent article) and require approval by leaders if the ruling in a case will be inconsistent with prior SPC rulings on the topic (this has been criticized as being inconsistent with judicial autonomy). Approval is required in several other situations, see Article 40 (2-4));
  • Articles 46-50 set forth rules for a collegiate panel to consider a case and submit it to the division leadership/professional judges committee/judicial committee;
  • Article 51 requires the judge responsible for the case (承办法官) to draft the decision reached according to the majority view, indicating that the role of responsible judge has administrative overtones. If not so, the judgment would be drafted by one of the judges who agreed with the majority view.
  • Article 58 retains existing special procedures (including special standards for transparency) for certain criminal cases, such as death penalty cases, cases involving foreigners, overseas Chinese, Hong Kong, Macau, and Taiwanese Chinese.
  • Article 61 provides the Central Commission for Discipline Inspection (CCDI) representative stationed at the SPC can be a member of the judicial committee (this seems to be analogous to the procedure under law under which a representative from the procuratorate can take part in judicial committee meetings). Additionally, anti-corruption officials stationed in each division can participate in professional judges committee meetings and collegiate panel discussions.   Article 61 does not require their views to be adopted.  It could be that their views are considered more seriously if discussions relate to matters regarding which they are competent.
  • Article 64 requires certain types of cases to be submitted for approval to higher levels of the SPC, including cases involving mass incidents, that will have an effect on social stability; difficult and complicated cases that will have a major effect on society; cases that will conflict with prior SPC cases; those that indicate the judge violated the law; death penalty review, major criminal cases, cases involving requests for instructions involving foreigners, overseas Chinese, Hong Kong, Macau, Taiwanese Chinese.

The vision for the reformed SPC remains a court with administrative characteristics (官本位), with concepts derived from other jurisdictions (judge’s assistant would be an example), that enables Party guidance in sensitive cases and its operations to reflect changes in Party/government policy (serving the actual situation), but seeks to be a more professional and accessible institution, hearing cases in a professional manner. It can be surmised that certain provisions from the Implementing Opinion will be incorporated into the revisions of the Organizational Law of the People’s Courts currently being drafted.

 

 

Forthcoming individual bankruptcy legislation revealed in letter to President Zhou Qiang’s mailbox

Screen Shot 2017-07-27 at 12.48.54 PMMost readers of this blog are unlikely to know that the Supreme People’s Court (SPC) publishes on its website responses to selected letters to President Zhou Qiang that make suggestions and give opinions. In a July 11 response, the SPC revealed that individual bankruptcy legislation is on its agenda. As I suggest below, actual legislation is likely to come later.

The letter said:

Dear Mr. Pan Dingxin:

We received your proposal, and after consideration, we respond as follows:

establishing and implementing an individual bankruptcy system is beneficial for those individuals or households who have fallen into serious financial distress to exempt some of their debts and enable them again through their hard work to achieve normal business and living conditions. Because of this, it has an important function to protect individuals and households that have fallen into financial difficulties. However an individual bankruptcy system relates to the establishment and improvement of an individual credit system and commercialization of commercial banks or their further marketization and other factors.  At the same time, the implementation of an individual bankruptcy system requires the National People’s Congress or its Standing Committee to legislate. We believe that with development and improvement of the socialist market economic, the National People’s Congress or its Standing Committee will promulgate an individual bankruptcy law on the basis of the experience with the “PRC Enterprise Bankruptcy Law.” The Supreme People’s Court will definitely actively support the work of the relevant departments of the state, and promote the implementation of an individual bankruptcy system.

Thank you for your support of the work of the Supreme People’s Court!

Supreme People’s Court

June 15, 2017

Screen Shot 2017-07-22 at 9.37.15 PM Few are aware that Shenzhen has been working on draft individual bankruptcy legislation for several years now, looking to Hong Kong’s experience and legislation, described in a recent report as a “complete” individual bankruptcy system (“完善的个人破产制度”).  The process has been going on for so long that the team (designated by the local people’s congress and lawyers association) and headed by a Shenzhen law firm partner published a book one year ago with its proposed draft and explanations.

Although Professor Tian Feilong of Beihang University’s Law School has been recently widely quoted for his statement about Hong Kong’s legal system undergoing “nationalisation,”  this is an example, known to those closer to the the world of practice, that Hong Kong’s legal system is also seen as a source of legal concepts and systems that can possibly be borrowed.  The drafting team looked at Hong Kong (among other jurisdictions) and others in China have proposed the same as well.

Shenzhen’s municipal intermediate court has completed an (award-winning) study on judicial aspects of individual bankruptcy shared with the relevant judges at the SPC.

If recent practice is any guide, individual bankruptcy legislation will be piloted in Shenzhen and other regions before  nationwide legislation is proposed, and it will be possible to observe the possible interaction between those rules and the government’s social credit system. So national individual bankruptcy legislation appears to be some years off.

As to why the SPC has a letter to the court president function, the answer is on the SPC website: it is to further develop the mass education and practice campaign (mentioned in this blogpost four years ago) and listen to the opinions and suggestions of all parts of society (the masses).  Listening to the opinion and suggestions of society are also required of him as a senior Party leader, by recently updated regulations. The regulations are the latest expression of long-standing Party principles.

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Welcome to the “Court President’s Mailbox”

 

 

China’s Evolving Case Law System In Practice

1200px-Tsinghua_University_Logo.svgI recently published an article in the Tsinghua China Law Review on Chinese case law in practice, building on several blogposts I had previously written and articles by fellow bloggers Jeremy Daum and Mark Cohen.  Many thanks are due to the persons who shared their experience and observations with me. A special thank you is due to the persons who provided detailed comments on earlier drafts.

China’s 19th Party Congress & Judicial Reform

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29 March meeting of Party leading group on judicial reform

Meng Jianzhu, Politburo member and head of the Communist Party Central Political Legal Committee, held a meeting in late March (photo above), to convey Xi Jinping’s message–those in leadership positions must do all possible to ensure that judicial system reform responsibility targets are basically achieved before the 19th Party congress (努力实现党的十九大召开前基本完成司法体制改革努力实现党的十九大召开前基本完成司法体制改革任务的目标). For those not familiar with Chinese political-legal jargon, “judicial system” (司法体制) means here the political-legal institutions–the courts, procuratorate, public/state security, and justice administration.   “Responsibility and targets” are also Chinese political jargon. Xi Jinping’s message dates from early January, when he highlighted this goal in instructions transmitted to the Communist Party Central Committee’s national political legal work conference.  He emphasized that the cornerstone of the judicial system reform is the judicial accountability system.  Part of the message  is that 2017 is a critical time, during which there is a “decisive battle” for deepening judicial reform, the battle intended to achieve those targets.  “Decisive battle” is also a core part of Chinese political jargon.

Since late March, Supreme People’s Court (SPC) President Zhou Qiang and other senior SPC leaders have been publicizing the target of completing judicial system reform, particularly the judicial accountability system, before the 19th Party Congress.  The SPC leadership has been doing that through meetings, both of the SPC itself (and the circuit courts) and the provincial-level courts and through SPC media outlets. President Zhou Qiang did so during a recent visit to Anhui, while on April 7, executive vice president Shen Deyong, vice-president Li Shaoping, and Political Department head Xu Jiaxin transmitted that message on a nationwide court video conference. This message is likely to be repeated in the months leading up to the 19th Party Congress.

In recent days, the SPC’s judicial reform office has been explaining these reforms to the public that reads SPC professional publications, such as the People’s Court Daily and China Trial, with some of the core content in the form of FAQs.  The reforms outline the way a post-reform court should operate. Some of the points were previously set out in the SPC’s February, 2017 judicial reform white paper.

A brief summary of the responses follows below:

  1. Why is the responsibility system the critical part of the judicial system reform (司法体制改革的“牛鼻子”)? Answer: because Xi Jinping said it, and judicial power and accountability/responsibility go together; accountability limits power.
  2. What is the responsibility of a presiding judge? Answer: take the lead in a case, by outlining the hearing of the case, allocating responsibilities, taking the lead at trial and in post-trial discussions, and in cases of significant differences of opinion, submit the case to either a specialist judges’ committee or judicial committee.
  3. How should the system of court president’s and division chief’s hearing cases be improved?Court leading cadres have multiple identities, including Party administrative responsibilities, and they must concurrently plan, announce and implement Party construction and adjudication [substantive] work, and for those who are quota judges, they should hear some cases too. Those cases should depend on a person’s background and strengths and should be major, difficult, complicated, or new cases which are representative.
  4. What is the relationship between judicial teams and court divisions? Answer: A Judicial team is comprised of judges, judge assistants, clerks and other auxiliary personnel, formulated respective lists of responsibilities of judges, judge assistants, and clerks, established the new judicial work mechanism with judges at the core and the team members cooperating with each other closely,
  5. When judges are randomly assigned to cases, how should the judge in charge of the case be determined? Answer: random selection should be primary, supplemented by assigned cases.
  6. How should the reform of having judges sign judicial documents [judgments/rulings, etc.] be understood? Answer: Judges who hear cases should sign their judgments and senior court leaders should no longer review or sign the judgments on the cases when they had not been personally involved.
  7. How should the reform of having a conference of professional judges be understood? Answer: judges in different substantive areas can organize committees to provide their views to other judges on problematic issues, reducing the number of cases referred to the judicial committee.
  8. In courts where there are many judges, how large should the conference of professional judges be? Answer:basically, it depends on the profile of the cases and the number of judges.
  9. What type of management and oversight responsibilities will a court president have besides hearing cases? He (she) will monitor judgments and rulings, sometimes recommending the matter go the judicial committee (see further details in the white paper).
  10. What type of management and oversight responsibilities will a division chief have in addition to his responsibilities hearing cases? As delegated by the court president, a division chief can review matters such as extending a defendant’s period of arrest or detention, or other compulsory measures or extend the period for submitting evidence.
  11. When judicial power is delegated down in judicial reform, how can it be monitored? The old system of having senior judges sign off on judicial documents, including ones that they had not heard, and they are also forbidden from approving cases in an indirect way, such as giving oral instructions. Senior judges should be working on a macro, not micro level.
  12. How can the judicial committee reform move forward reliably? Answer: from now on, the focus of the work of judicial committees should change from discussing individual cases to summarizing experience, and discussing major cases, with exceptions (foreign affairs, social stability, etc. (see the analysis in the white paper).

Comments

These questions and answers reflect the challenges the SPC faces in moving the Chinese court system (including its own operations) away from the traditional model that fuses judicial authority with traditional Chinese [Communist Party] administration.  The post-reform concept of the judiciary is a more professional judiciary that gives judges greater professional autonomy (and therefore can retain the sophisticated talent that is leaving for law firms) but retains control in specified areas. How successful will these reforms be in moving courts and judges away from old patterns of behavior remains to be seen. It seems to be happening in at least some of the pilot courts (from my discussions), but that does not mean these will be successful in other less sophisticated areas.  Presumably, the SPC’s judicial reform office is monitoring the pilots in a more systematic way.

The reasons for stressing the importance of accomplishing these reforms by the 19th Party Congress are assumed, not explained. I understand it as intended to show that the judicial system reforms that have been undertaken in recent years are correct, have accomplished what they were intended to accomplish, and are effective in improving China’s judicial system.  I expect that the system described above is reflected in the redrafts of the People’s Court Organizational Law and the Judges’ Law.  To what extent will these reforms (apparently accompanied by increased political study) be able to retain the talent currently in or being recruited into the courts?

 

Signals in Zhou Qiang’s 2017 report (Part 2)

This blogpost continues the analysis in Part 1, which analyzed the first several sections of Zhou Qiang’s work report to the National People’s Congress, concerning court caseload, social stability and criminal punishment, and the courts serving to maintain the economy.

Most people who have commented (outside of China) on Supreme People’s Court (SPC) President Zhou Qiang’s March, 2017 report to the National People’s Congress (NPC) didn’t have the patience to read (or listen) much beyond the initial section, which mentions the conviction of Zhou Shifeng as indicating that the courts are doing their part to crack down on state subversion.  It appears to be another in a series of colorless government reports.  But for those with the ability (or at least the patience) to decode this report, it provides insights into the Chinese courts, economy, and society.

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The report, which went through 34 drafts, is intended to send multiple signals to multiple institutions, particularly the political leadership, in the months before the 19th Party Congress.

According to a report on how the report was drafted, the drafting group (which communicated through a Wechat group to avoid time-consuming bureaucratic procedures) faced the issue of how to summarize the work of the People’s Court in 2016 correctly.  The guidance from President Zhou on the report–it must:

  1. fully embody the upholding of Party leadership, that court functions (审判职) must serve the Party and country’s overall situation;
  2. embody the new spirit of reform, showing the (positive) impact of judicial reform on the courts and show the ordinary people what they have gained;
  3. not avoid the mention of problems, but indicate that they can be resolved through reform.

Underneath these political principles, the operation of a court system with Chinese characteristics is visible.

Guaranteeing people’s livelihood rights & interests

The following section is entitled  “conscientiously implement people-centered development thinking, practically guarantee people’s livelihood rights and interests.” It summarizes what the courts have been doing in civil and administrative cases, but it also signals their perceived importance in this national report.

Civil cases

President Zhou Qiang noted that the Chinese courts heard 6,738,000 civil  (民事) cases, an increase of 8.2%.  Although he did not define what he meant by civil cases, under Chinese court practice, it refers to the type of cases under the jurisdiction of the #1 civil division (see this earlier blogpost):

  1. Real estate, property and construction;
  2. Family;
  3. Torts;
  4. Labor;
  5. Agriculture;
  6.  Consumer protection; and
  7. Private lending.

On labor cases, the report mentioned that the courts heard 473,000 labor cases. This is a slight decrease from 2015 (483,311) (although the report did not do a year on year comparison). The report signalled that the SPC is working on policy with the labor authorities on transferring cases from labor mediation, labor arbitration, to the courts. This was signaled previously in the SPC’s policy document on diversified dispute resolution.  Articles on both the SPC website and local court websites have signaled the increasing difficulty of labor disputes, and the increase in “mass disputes.”

As explained in this blogpost, labor service disputes, relate to an “independent contractor,” but more often a quasi-employment relationship, governed by the Contract Law and General Principles of Civil Law, under which the worker has minimal protections. This year’s report did not mention the number of labor service cases. In 2015, the Chinese courts heard 162,920 labor service cases, an increase of 38.69%.

There was no further breakdown on the number of other types of civil cases, such as private lending or real estate cases.  For these statistics, we will need to await any further release of big data by the SPC. As blogposts in recent months indicate, private lending disputes are on the rise in economically advanced provinces and bankruptcy of real estate developers remains a concern.

This section also mentions criminal proceedings against illegal vaccine sellers, although the topic may be more appropriately be placed with the rest of the criminal matters, but likely because it is an issue that drew widespread public attention.

Family law

Echoing language in recent government pronouncements, the section heading mentions protecting marriage and family harmony and stability. The report mentions that the courts heard 1,752,000 family law cases in 2016, with no year on year comparison with 2015.  The report mentions that the SPC has established pilot family courts (as previously flagged on this blog).

Administrative disputes

First instance administrative disputes totaled 225,000 cases, a 13.2% increase over 2015, but a tiny percentage of cases in the Chinese courts. The report highlights developments in Beijing and Shanghai (they are being implemented in Shenzhen, although not mentioned), to give one local court jurisdiction over administrative cases.  According to the statistics (in Beijing, at least), this has led to a sizeable increase in administrative cases.  The report also mentions the positive role that the courts can play in resolving condemnation disputes (this blogpost looked at problems in Liaoning).

Hong Kong/Macao/Overseas Chinese cases

As mentioned by Judge Zhang Yongjian, the report mentions that the courts heard 19,000 Hong Kong, Macau, Taiwan, Overseas Chinese related cases, and handled 11,000 judicial assistance matters with the three greater China jurisdictions.  The report also mentions the recently signed arrangement between the SPC and Hong Kong judiciary on the mutual taking of evidence, a development that seems to have escaped the notice of the Hong Kong legal community.

Military related disputes

Unusually, the report mentioned that the local courts heard 1678 military-related cases and have developed systems for coordination between the civilian and military courts.  These developments have been analyzed further in a blogpost on the Global Military Justice Reform blog.

Strictly governing the courts and institutional oversight

The following two sections of the report give a report on how the courts are upholding Party leadership, increasing Party construction within the courts, internal Party political life, and political study, all of which are in line with recent developments. Although these are stressed, this does not mean that professional competence is less valued.  The increasing caseload,  higher expectations of litigants, particularly in commercial cases, and increasing technical complexity of cases means that the SPC is in fact taking measures to improving professional capacity of the courts.  This section also mentions courts and individual judges that have been praised by central authorities and 36 judges who have died of overwork.

On anti-corruption in the courts, the report mentions that 769 senior court officials have been held responsible for ineffective leadership, 220 have been punished for violations of the Party’s Eight Point Regulations. The SPC itself had 13 persons punished for violations of law and Party discipline (offenses unstated), 656 court officials were punished for abusing their authority, among whom 86 had their cases transferred to the procuratorate.

On institutional oversight, the report signals that the SPC actively accepts supervision by the NPC, provides them with reports, deals with their proposals, and invites them to trials and other court functions. On supervision by the procuratorate, the report revealed that the SPC and Supreme People’s Procuratorate are working on regulations on procuratorate supervision of civil and enforcement cases, a procedure sometimes abused by litigants.

2016 and 2017 judicial reforms

2016

On 2016 judicial reform accomplishments, the following were highlighted:

  1. circuit courts;
  2. case filing system;
  3. diverse dispute resolution;
  4. judicial responsibility;
  5. trial-centered criminal procedure system;
  6. separation of simple from complicated cases;
  7. people’s assessors‘ reform;
  8. greater judicial openness;
  9. more convenient courts;
  10. improving enforcement (enforcement cases were up 31.6% year on year), including using the social credit system to punish judgment debtors.

2017

The report mentions that among the targets for the courts is creating a good legal environment for the successful upcoming 19th Party Congress.  That is to be done through the following broad principles:

  1. using court functions to maintain stability and to promote development (for the most part mentioning the topics reviewed earlier in the report);
  2. better satisfying ordinary people’s demands for justice;
  3. implementing judicial reforms, especially those designated by the Party Center;
  4. creating “Smart” courts; and
  5. administering the courts strictly and improving judicial quality.

This last section mentions implementing recommendations required by the recent Central Inspection Group’s (CIG) inspection and Central policies applicable to all political-legal officials, before focusing on the importance of more professional courts, and improving the quality of courts in poor and national minority areas.

A few comments

It is clear from the above summary that the content of President Zhou Qiang’s report to the NPC is oriented to the upcoming 19th Party Congress and the latest Party policies. It appears that no new major judicial reform initiative will be announced this year.

It is likely too, that the selective release of 2016 judicial statistics in the NPC report also relates to messaging in line with the upcoming 19th Party Congress, although we know that the SPC intends to make better use of big data.  We can see that overall, the caseload of the courts is increasing rapidly, including institutionally difficult cases (such as bankruptcy and land condemnation), which put judges and courts under pressure from local officials and affected litigants. In the busiest courts, such as in Shanghai’s Pudong District, judges will be working extremely long hours to keep up with their caseload, and the impact of new legal developments. It appears (from both the report and the results of the CIG inspection) that judges will need to allocate more time to political study.  How this will play out remains to be seen. We may see a continuing brain drain from the courts, as we have seen in recent years.

 

Signals in Zhou Qiang’s 2017 NPC Report (Part 1)

Most people who have commented (outside of China) on Supreme People’s Court (SPC) President Zhou Qiang’s March, 2017 report (on 2016 work) to the National People’s Congress (NPC) didn’t have the patience to read (or listen) much beyond the initial section, which mentions the conviction of Zhou Shifeng as indicating that the courts are doing their part to crack down on state subversion.  It appears to be another in a series of colorless government reports.  But for those with the ability (or at least the patience) to decode this report, it provides insights into the Chinese courts, economy, and society.

imgres-14

©

The report, which went through 34 drafts, is intended to send multiple signals to multiple institutions, particularly the political leadership, in the months before the 19th Party Congress.

According to a report on how the report was drafted, the drafting group (which communicated through a Wechat group to avoid time-consuming bureaucratic procedures) faced the issue of how to summarize the work of the People’s Court in 2016 correctly.  The guidance from President Zhou on the report–it must:

  1. fully embody the upholding of Party leadership, that court functions (审判职) must serve the Party and country’s overall situation;
  2. embody the new spirit of reform, showing the (positive)impact of judicial reform on the courts and show the ordinary people what they have gained;
  3. not avoid the mention of problems, but indicate that they can be resolved through reform.

Underneath these political principles, the operation of a court system with Chinese characteristics is visible.

A partial decoding of the report reveals the points listed below (to be continued in Part 2).

1. Caseload on the rise

The caseload in the Chinese courts continues to rise significantly, at the same time that headcount in the courts is being reduced.  Diversified dispute resolution (the jargon outside of China is alternative dispute resolution) is being stressed.

  • SPC itself is dealing with a massive increase in its cases, 42.6% higher than 2016, and that number was significantly higher than 2015.
    Screen Shot 2017-03-16 at 4.07.25 PM.png

    2016, SPC cases accepted 22,742, up 42.3%, concluded 20151, 42.6%, Circuit Cts #1 & 2 accepted 4721 cases in last 2 yrs, resolved 4573 cases

     

The statistics on the SPC’s caseload are not broken down further, but are understood to be mostly civil, commercial, and administrative.  It appears from a search of one of the case databases that not all of the SPC judgments or rulings have been published (a search of one of the judgment databases showed 6600+, and only some of the death penalty approvals). It seems also that the database does not include SPC cases such as the judicial review of certain foreign and foreign-related arbitration awards.

Although the report does not focus on the reasons for the massive increase in SPC cases, careful observation reveals the following reasons:

  • establishment of the circuit courts, hearing more cases and ruling on applications for retrials;
  • increase in the number of civil and commercial cases with large amounts in dispute;
  • SPC itself has implemented the case registration system; and
  • changes in law giving litigants rights where none previously existed.

The report also mentioned that 29 judicial interpretations were issued (some analyzed on this blog) and that 21 guiding cases were issued.  Model cases and judicial policy documents were not separately set out, although some were listed in the appendix to the SPC report distributed to delegates.

Lower courts

23,030,000 cases accepted by lower courts, up 18%, cases resolved, 19,773,000; amounts in dispute up 23%

The pie chart below sets out the statistical distribution of cases heard by the Chinese courts:

 

Screen Shot 2017-03-16 at 9.59.06 PMThe pie chart of cases heard, enforced and closed in 2016 shows:

  • about 60% of those cases were civil, commercial, or intellectual property cases;
  • 6.41% criminal cases,
  • 3.40% parole, sentence reduction cases;
  • almost 26% enforcement cases,
  • .03% state compensation cases,
  • petition or application for retrial, .91%;
  • and 1.66% administrative cases.

Although the stress in Zhou Qiang’s report is placed on law and order, in fact many more cases in the Chinese courts are civil and commercial rather than criminal.

2. Social stability, public order, law & order are major concerns

Criminal cases have a prominent place in the report, although the data reveals a slight increase in the number of cases  (1.5%), involving the conviction of 1,220,000 people, down 1%. (Note that many minor offenses are punished by the police, with no court procedures).

Although the report mentioned the Zhou Shifeng case (state security) and criminal punishment of terrorist and cult crimes, it did not release statistics on the number of cases of any of these crimes heard.  Corruption cases totaled 45,000 cases, involving 63,000 persons.  Violent crimes (murder, robbery, theft) cases 226,000. Drug cases: 118,000, a significant decrease from 2015. 2016 cases of human trafficking and  sexual assault on women and children totaled 5335, while telecommunications fraud cases in 2016 totaled 1726.  Only 213 cases involving schoolyard bullying were heard and the SPC revealed that the drafting of a judicial interpretation on the subject is underway. The report highlighted some of the well-known criminal cases, including the insider trading case against Xu Xiang and the Kuai Bo obscenity cases to illustrate and criminal law-related judicial interpretations to signal that the courts are serving policy needs in punishing crime.

The same section described what has been done in 2016 to correct mistaken cases, highlighting the Nie Shubin case (reheard by Judge Hu Yuteng and colleagues) as an example.  The report revealed that the local courts retried only 1376 criminal petition cases, likely a tiny fraction of the criminal petitions submitted.

3. Maintain economic development

As President Zhou Qiang indicated, the way that the Chinese courts operate is Party/government policy-driven (they must serve the greater situation). Serving the greater situation meant, in 2016, that the Chinese courts heard 4,026,000 first instance commercial cases, a 20.3% increase year on year.  He also mentioned the 3373 bankruptcy cases analyzed in an earlier blogpost. Of those 4 million commercial cases, 1,248,000 involved securities, futures, insurance, and commercial paper and 255,000 real estate cases and 318,000 rural land disputes. Other implications are discussed below.

This section of the report devoted a paragraph to a topic discussed last year on this blog: the courts serving major government strategies, including One Belt One Road, the Yangtze River Belt, and Beijing-Tianjin-Hebei coordinated development.

Green development , intellectual property (IPR), property rights (of private entrepreneurs), serving maritime and major country strategy, socialist core values, judicial solutions to new problems and cross-border assistance also merited mention in this section.

  1. The courts heard 133,000 environmental and natural resources cases, with Fujian, Jiangxi and Guizhou courts designated as experimental environmental courts.  While public interest environmental and procuratorate brought (environmental) cases were mentioned, statistics were not set out.
  2. First instance IPR cases totaled 147,000, with several cities (Nanjing, Suzhou, Wuhan, and Chengdu) establishing IPR divisions to take cases across administrative boundaries. This section mentioned the Jordan trademark case and the IPR courts.
  3. On protection of property rights, the report mentioned some of the documents intended to protect private entrepreneurs discussed on this blog, as well as 10 model cases.
  4. On maritime and cross-border cases, the report mentions the judicial interpretations on maritime jurisdiction (discussed in this blogpost), intended to support the government’s maritime policy, including in the South China Sea.  The Chinese courts heard only 6899 commercial cases involving foreign parties (this means that of the 2016 19,200 civil and commercial cases mentioned by Judge Zhang Yongjian, most must have been civil) and 16,000 maritime cases. The report again mentions making China a maritime judicial center, further explained in my 2016 article.
  5. On the relevance of socialist core values to the courts, that is meant to incorporate socialist core values into law (although they should be understood to have always to be there) and to give the Langya Heroes special protection under China’s evolving defamation law.
  6. Judicial solutions to new issues included internet related issues, including e-commerce cases, internet finance cases, and theft of mobile data; the first surrogacy case, and judicial recommendations to Party and government organizations.
  7. In the section on international cooperation, President Zhou Qiang revealed that fewer than 3000 cases involving mutual judicial assistance were handled. The bureaucratic and lengthy procedures for judicial assistance in commercial cases has long been an issue for lawyers and other legal professional outside of China.  This is likely to change (in the long run, as Chinese courts increasingly seek to obtain evidence from abroad).  US-China dialogue on bankruptcy issues and cooperation with One Belt One Road countries (cases involving these countries are increasing significantly), were also mentioned here.

TO BE CONTINUED

 

Results of inspector findings at SPC

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In November, 2016, this blog reported on Central Inspection Group (CIG) #2 inspecting the Supreme People’s Court (SPC) ’s Communist Party group.  Recently, CIG #2 came back with feedback on its inspection.  SPC leadership was in attendance and circuit court leadership participated by videoconference. A rough translation of the problems identified follows:

During the tour, the inspection team found…some problems, mainly: “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.

The report revealed that some cases have been referred to CCDI and the Party’s Organization Department for further handling.

President (and Party Secretary) Zhou Qiang accepted the criticism and promised to deal with it. A separate report revealed that a rectification strategy has been adopted and an office established to implement measures to respond to the criticism.

Comment

It is difficult, if not impossible for this observer to have independent sources of information on the implementation of political discipline, political rules, and ideological work in the SPC.

It does appear (to the outside observer) from the constant flow of judicial reform documents, judicial interpretations, judgments (and rulings), and the many other documents released by the SPC, that the large number of SPC judges and other support personnel have been professionally extremely productive.

One criticism that I had heard before was about coordination in the judicial reforms. As to why some reforms were rolled out before others, the reasons are likely complicated and relate to what was ready to go and generally accepted.  As to the implications one reform has on other reforms or the existing system, that is much more difficult to analyze, particularly if (as I suspect), the SPC’s judicial reform office does not have enough people to cope with the complexities of implementing judicial reforms in a highly bureaucratic state.

On the cases of violation of Party discipline revealed, it would appear that they were limited in number and apparently limited (for the most part?) to minor infractions, such as fiddling with subsidies and using government cars for private purposes.  In a large bureaucracy such as the SPC, it seems fair to assume that a few infractions are likely to occur. It seems reasonable to surmise that these cases will be wrapped up swiftly, before the upcoming National People’s Congress session, and we will learn more about the specific cases.

 

Supreme People’s Court adds four more circuit courts

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Meng Jianzhu meeting circuit court judges

The latest National People’s Congress Standing Committee (NPCSC) gave formal approval to the Supreme People’s Court (SPC) to establish four more circuit courts, located in Nanjing, Zhengzhou, Chongqing and Xian.  The Leading Small Group on Comprehensive Reform had given the nod to the SPC and its preparations at the beginning of November, so approval by the NPCSC was a foregone conclusion. The four new circuit courts held ceremonies on 28 and 29 December to inaugurate their operations. This means that circuit courts now cover the entire country. As discussed in my earlier blogpost, these are actually subdivisions of the SPC rather than being separate courts.

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Map of new circuits (thanks to Chinalawtranslate)

This blogpost looks at:

  • What the official reports signal about the Chinese judiciary; and
  • What these circuit courts mean for the Chinese judiciary now and in the future.

Signalling in official reports

The official reports related to the circuit court celebrated the circuit court judges and the courts themselves as both “red and expert.”

In this report, on their meeting with Meng Jianzhu, secretary of the Central Political Legal Committee, a subheadline has him meeting with circuit court “cadres” (孟建柱在会见最高人民法院巡回法庭干部…), while the first line of the report uses the phrasing “judge and other staff”  (全体法官和工作人员).  Meng Jianzhu stressed that close [flesh and blood] ties between the Party and the people in the judicial field is the important mission of the Supreme People’s Court Circuit Courts the circuit courts are under the leadership of his committee], while at the same time saying that “we should adhere to the [policy] direction of the judicial system reform,..create a professionalized trial team…”

Other reports note that of the 54 judges, 41 have either master’s or doctorate degrees. An infographic with photos of the senior judges and a map of the jurisdictions of the circuit courts can be found here.

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3rd circuit court judges receiving petitioners

Are the circuit courts just reception offices for petitioners?

This blogpost will draw on the insights of Zhou Yibin, one of my students at the School of Transnational Law of Peking University, located in Shenzhen, where I am privileged to teach some of China’s best and brightest.

Analyzing the documents related to the establishment of the circuit courts, she comments the circuit courts’ function of “trying important cross-administrative civil, commercial and administrative cases to ensure justice is repeatedly emphasized, while  diverting petitioners’ visits away from Beijing [as reported in this blogpost], reducing the workload for SPC .

Although the SPC knows that the pressure of petitioners’ visits is the direct reason to establish circuit courts, the SPC still wishes that the circuit courts will function more as courts to deal with the judicial localization [local protectionism] problem rather than another petitioners’ reception office. She notes that the huge pressure of dealing with petitioners visits and complaints  with small elite teams, means that they are working very efficiently.

Statistics are available for 2015 for the #1 and #2 Circuit Courts, and in 2016 for the #2 Circuit.In 2015, the #1 Circuit Court accepted 898 cases and closed 843, while the #2 Circuit Court accepted 876 and closed 810.  For the #2 Circuit Court, about half were civil and commercial cases (of which about 20% were transprovincial), while the remaining half was split between criminal and administrative cases.  The #2 Circuit Court dealt with 33,000 petitioners, while the #1 Circuit Court dealt with fewer than 11,000.  Through end September, 2016, the #2 Circuit Court had accepted 907 cases, and the number of petitioners had dropped considerably in 2016 to an average of 70-80 persons per day, down from almost 180 per day, with fewer petitioners complaining about injustices in litigation. It is understood that the number of cases accepted by the #1 Circuit Court has also increased in 2016 in comparison to 2015, although statistics are not yet available.

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Petitioners visiting the #2 circuit court, per month

 

 

 

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opening of 3rd & 4th circuit courts

Zhou Yibin notes the following issues, among others:

  1. First, limited by territorial jurisdiction and subject amount in controversy, there aren’t enough cross-jurisdictional cases for the circuit courts to try. She found that the head of the #1 Circuit Court had said the same.
  2. Mid-career SPC judges may be reluctant to be assigned to the circuit courts, when they have family in Beijing.
  3. Having circuit courts may lead to more inconsistencies among SPC judgments.

She wrote: the circuit courts are not likely to be an effective barrier to judicial local localization/protectionism. That local protectionism happens when the local courts abuse their adjudication power to protect local litigants’ interests. Judicial localization is the caused by the administration of judicial system and unconstrained exercise of administrative and political power.When it comes to judicial activities, local Party/government officials  tend to unduly influence the judges by leaving notes or giving direct instructions when they want to protect local interests. That is exactly why in 2015, the general office of the Central Committee of the CCP and the general office of the State Council jointly issued a notice requiring judges and clerks keep a record if any officials interfere cases in any form [see this earlier blogpost].

From this aspect, when the real concern is abuse of power and lack of institutional design to rein power, judicial reform in any form, would only be a “back-end pain killer”, rather than real surgery that can directly solve the source.

Conclusion

She concludes: as to whether circuit courts should continue to exist, people who are pessimistic about circuit courts characterize it as window-dressing. They believe circuit courts would not be the real key to deal with judicial localization and there exist better alternatives to deal with petitioners’ visits than circuit courts; therefore, the circuit courts should be eliminated before it creates further inconsistency and chaos to judicial system.

Zhou Yibin thinks circuit courts should continue to exist for the following reasons.

First, in 2015, SPC altered the amount in controversy and lower the barrier for case acceptance. Therefore, we can expect circuit court to play a more important role in providing neutral venue so as to fight with judicial localization.

Second, there are other efforts to curb judicial localization collectively. At the same time with setting up circuit courts, SPC is also exploring to set up cross-administrative courts. Currently, this experiment is steadily progressing in Shenzhen, Shanghai and Beijing. This wave of judicial reform has just started, and we need to allow a little bit more time for the circuit courts and cross-administrative courts to grow, to engage in trial and error and to mature.

Third,  aside from dealing with judicial localization, the circuit courts serve as pilot for SPC to improve the quality of its legal policy role by research into local legal issues and greater interaction with local legal communities. This is an important institutional function that is totally left out in the opponents’ objection. There are certainly institutional costs to maintain circuit courts, but we cannot ignore the institutional function of innovation that circuit courts serve.

I would also add to this that from the statistics provided above, the effect of the #2 Circuit Court’s work related to administrative cases can be seen in the reduction in the number of petitioners, particularly those complaining about injustices in the lower courts.

[For those who want to visit the circuit courts, detailed information about their location can be found here. As part of its efforts towards greater transparency and outreach to the foreign legal community, perhaps in the new year the SPC will publish clearer guidance on how foreigners can visit Chinese courts (although this is not likely to be a priority matter).]

 

What the Central Economic Work Conference means for the Chinese courts

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©China Daily

The day after the Communist Party Central Committee’s Central Economic Work Conference concluded, the Supreme People’s Court’s (SPC’s) Party Committee held a meeting to study the “spirit of the Central Economic Work Conference.”  According to SPC President Zhou Qiang, the Central Economic Work Conference has the following takeaways for the courts:

First, adhere to strict and impartial justice, and create an open, transparent and predictable rule of law business environment 

Among the points– “We must insist on protecting the lawful rights and interests of Chinese and foreign parties equally according to law and building a more competitive international investment environment.”

Note, of course, that the foreign chambers of commerce in China have other views of the current state of the business environment at the moment, but agree that rule of law, transparency, and predictability are critical for improving China’s economic performance.  The following is from the European Union Chamber of Commerce in China’s  Business Confidence Survey 2016 

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AmCham China: “Respondents now cite inconsistent regulatory interpretation and unclear laws as their No. 1 business challenge.”

Second,  use the rule of law to actively promote the supply side structural reform

Zhou Qiang called on the lower courts to work better on bankruptcy cases, give full play to the role of the information network of bankruptcy and reorganization of enterprises, actively and safely deal with “zombie enterprises”, to optimize the allocation of resources to resolve the excess capacity.

But actually, bankruptcy cases remain fraught.

According to SPC Senior Judge Du Wanhua, charged with making bankruptcy law work better, in China bankruptcy requires a unified coordination mechanism  with government and courts, under Party Committee leadership.

In recent high profile corporate bankruptcies, such as LDK Solar, the local governments say that they cannot afford to rescue the companies, and so the burden must fall on creditors. The LDK case has drawn complaints from bankruptcy practitioners that the local government-led restructuring was designed to force banks to swallow the losses. Another lawyer commented that local governments’ intervention in bankruptcy cases has often disrupted their fairness.

It is likely that we will see more developments in 2017 concerning bankruptcy.

The third is to further increase the protection of property rights

Among the points Zhou Qiang made:

  • We must strengthen the protection of property rights of various organizations and natural persons;
  • We should have the courage to correct a number of mistaken cases concerning infringement of property rights.

These statements relate to three documents issued in late November and early November on protecting property rights, linked to the Central Committee/State Council’s November 4 document on the same topic, following the document issued in late October (and describe in my recent blogpost). They include:

All three relate to (well-known) abuses of China’s justice system, including:

  • turning business disputes to criminal cases (a risk for both Chinese and foreign businesses);
  • courts freezing assets far exceeding the amount in dispute (this is one example);
  • court confiscating the personal property of the entrepreneur and his (her) family, failing to distinguish between corporate and personal property;
  • courts failing to give parties opposing freezing or confiscation order a chance to be heard;
  • courts failing to hear disputes between government and entrepreneurs fairly.

The first document (apparently drafted by the SPC Research Department, because its head explained its implications at the press conference at which the first two documents were released) repeats existing principles that state-owned and private litigants, Chinese and foreign litigants should be treated equally.  It repeats existing principles that public power must not be used to violate private property rights.

The Historical Property Rights Cases Opinion (apparently drafted by the SPC’s Trial Supervision Division, because its head explained its implications at that press conference) calls on provincial high courts to establish work groups to review mistaken cases and to avoid such tragedies in the first place, focusing on implementing the regulations restricting officials from  involving themselves in court cases and the judicial responsibility system.

The third document seeks to impose better controls on the use of enforcement procedures by the lower courts.

Comments

It is hoped that these documents can play some part in improving the quality of justice in China, despite the difficulties posed while the local courts remain under local Party/government control, and may lead to the release of unfairly convicted entrepreneurs and the return of unfairly confiscated property. Perhaps these documents may provide some protection to local judges seeking to push back against local pressure.  On the historical cases, the SPC Supervision Division should consider appealing to current or retired judges who may have been involved in these injustices to come forward (without fear of punishment), as they likely to be able to identify these cases. A defined role for lawyers would also be helpful.

On the equal protection of enterprises, it should be remembered that the SPC itself has issued documents that give special protection to some parties, such as “core military enterprises.”

It appears that these documents respond to the following:

  • years of criticism of  differential legal treatment of and discrimination against private entrepreneurs;
  • academic studies by influential institutions on the criminal law risk faced by private entrepreneurs;
  • Downturn in private investment in the Chinese economy;
  • Lack of interest on the part of private enterprise in private-public partnerships;
  • Increase in investment by private enterprise abroad, most recently illustrated by the Fuyao Glass investment in Ohio;
  • articles such as this one describing Chinese entrepreneurs as either in jail or on the road to jail.

Fourth, proactive service for the construction of “one belt one road” 

This section repeats many of the themes highlighted in the SPC’s earlier pronouncements on One Belt One Road (OBOR or Belt & Road), the maritime courts, and foreign-related commercial developments. The Chinese courts continue to grapple with the increased interaction and conflicts with courts in foreign jurisdictions. The OBOR jurisdictions are handicapped by a dearth of legal professionals with familiarity with the Chinese legal system.

We should expect to see more developments directly or indirectly linked to OBOR, including a more standardized approach to the judicial review of arbitration clauses.

Fifth, strengthen the judicial response to the risks and challenges of the economy

Among the issues that President Zhou Qiang mentioned

  •  Internet finance;
  • Internet fraud;
  • illegal fund-raising and other crimes;
  • real estate disputes;
  • cases involving people’s livelihood, increasing the recourse of migrant workers and other cases of wage arrears.

These are all ongoing, difficult issues for the courts. Legislation does not demarcate clearly the line between legal and illegal forms of financing as discussed here. Migrant workers, particularly in the construction industry, are often not hired under labor contracts but labor service contracts, which reduces their entitlements under the law. As the Chinese economy continues to soften, it is likely that complex real estate disputes (of the type seen in 2015) will burden the lower courts.

We are likely to see further developments in these areas.

President Zhou Qiang told the courts to make good use of judicial “big data” to detect trends and issues so the courts can put forward targeted recommendations for reference of the Party committee and government decision-makers. He has made this point repeatedly recently.

For foreign observers of China, judicial big data is in fact a useful source of indicating trends across the Chinese economy, society, and government.  This blog has flagged some analyses, but there is much more than can and should be done.

Inspectors stationed at the Supreme People’s Court & Procuratorate

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CIG mobilization meeting at the SPC

Close followers of the Supreme People’s Court (SPC) media outlets will have noticed a 15 November report of a mobilization meeting of the Central Inspection Group (CIG) #2 inspecting the SPC’s Communist Party group.  A brief report on CCTV is found here. Further digging reveals that news of the inspection was released on the Central Commission for Discipline Inspection (CCDI) website in early November, and that the inspection is part of the current round of CIG inspections of 27 Party, government, and other entities.  Other legal institutions being inspected in this round include the Supreme People’s Procuratorate (SPP) and the China Law Society (a mass (government organized non-government organization)).  The Ministry of Public Security was inspected earlier this year in an earlier round,  along with the State Council’s Legislative Affairs Office, the National People’s Congress (including its Legislative Affairs Commission), the State Intellectual Property Office, and many others.

report on CIG #7’s mobilization meeting at the SPP was released at the same as the SPC’s, and is worded similarly to the SPC report.These institutions are being inspected for approximately a two month period, from 11 November (14 November for the SPP) to 10 January 2017.

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CIG mobilization meeting at SPP

Background on CIGs and how they operate can be found in a recent 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.

According to these  notices, the focus is on the Party leadership of these institutions, at the highest and next highest level, and compliance with political and Party discipline.

Some comments

Matters that require the attention of the SPC’s  senior leadership (and similarly the SPP’s), of which there are many (one small example is considering whether a draft judicial interpretation is ready for passage) , are likely to find a much slower response time, as persons in the most senior positions, and those senior personnel with whom they work most closely, will most likely be preoccupied with responding to the requests of the inspectors. (This insight is derived from my personal experience (with school inspectors), my many discussions with in-house counsel facing government inspectors, and the rich professional/scholarly commentary on government inspections/audits).

I can only hope (as a long-time foreign observer of the SPC (and less so of the SPP), that the leaders of these institutions have done a good job in personal compliance, as well as signalling to their institutions the importance of complying with various types of political and Party discipline, because a well-functioning Chinese judicial system (and a prosecutorial system) is important not only for China, but the rest of the world.

One small example of the work facing the SPC that is relevant to the rest of the world is one of the Chinese government’s commitments at the Hangzhou G20 meeting, which requires the SPC to take on a major role in improving the operation of China’s bankruptcy system:

China and the United States recognize the importance of the establishment and improvement of impartial bankruptcy systems and mechanisms. China attaches great importance to resolving excess capacity through the systems and mechanisms relating to mergers and acquisitions; restructuring; and bankruptcy reorganization, bankruptcy settlement, and bankruptcy liquidation, according to its laws. In the process of addressing excess capacity, China is to implement bankruptcy laws by continuing to establish special bankruptcy tribunals, further improving the bankruptcy administrator systems and using modern information tools. China and the United States commit to, starting as early as 2016, conduct regular and ad hoc communication and exchanges regarding the implementation of our respective bankruptcy laws through forums or mutual visits.

 

Update on Judge Xi Xiaoming

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Judge Xi Xiaoming

In the run up to the Sixth Plenum of the Central Committee of the Communist Party, which will focus on “intra-Party political life in the new situation,” the Supreme People’s Procuratorate (SPP) released further information concerning former Supreme People’s Court (SPC) Vice President Xi Xiaoming.  As this blog noted over one year ago, his case was transferred from the Party disciplinary authorities to the SPP for further investigation.  According to a recent report, The SPP has finished its investigation and has transferred Judge Xi’s case to the Second Branch Procuratorate of the Tianjin People’s Procuratorate.  The procuratorate has filed its case in the #2 Tianjin Intermediate People’s Court. The authorities apparently considered these institutions reliable,  because they had dealt with other sensitive cases earlier this year. 

The charges against Xi include:  using his office and position to obtain benefits for others or using his authority and position to provide conditions [for obtaining benefits], and obtaining improper benefits through the acts of other state staff in the course of their work, illegally accepting huge amounts of money and assets.  The judgment to which the charges relate has been published.

The report repeated statements made about Judge Xi earlier by Meng Jianzhu, head of the Central Political Legal Committee, and SPC President Zhou Qiang.  In August, 2015, Meng said: “Xi Xiaoming has shamed the judiciary, as an experienced judge who has worked in the Supreme People’s Court for 33 years, who has colluded with certain  illegal lawyers, judicial brokers, and lawless business people by accepting huge bribes.” During his report to the NPC in March, 2016, Zhou Qiang said: “especially the effect of Xi Xiaoming’s case of violating law and discipline is terrible, has deep lessons” (尤其是奚晓明违纪违法案件影响恶劣、教训深刻). The report also mentioned that Judge Xi’s case has been used as a typical case by the Central Commission for Discipline Inspection.

Although the SPC and several other central criminal justice institutions have recently issued a policy document on making the criminal procedure system trial-centered, the first principle of which is “no person may be found guilty except by the lawful judgment of a people’s court,” Judge Xi’s case seems to be yet another instance in which the exigencies of the political system trump respect for the formalities of the operation of the criminal justice system.