A recent message in the WeChat public account of the Supreme People’s Court (SPC)’s Administrative Division was devoted to promoting its new book, Supreme People’s Court Administrative Litigation User’s Guide (Administrative Litigation User’s Guide (2nd edition), 最高人民法院行政诉讼实用手册), shown in the photo above. Had the SPC’s #4 Civil Division had a WeChat public account last year when they published 涉外涉港澳台民商事审判业务手册( Foreign-Related, Hong Kong, Macao and Taiwan Related Commercial Trial Work Guide — “Foreign-Related Judicial Handbook”), I am sure that I would have received a similar message. I had previously thought that judicial handbooks were a historical artifact of the days before electronic databases. In my 1993 article, I discussed the phenomenon of judicial handbooks:
..A …problem is presented when the lack of consistency in issuance and authority makes it difficult for the lower courts to know when an interpretation is no longer valid…The [SPC] tries to cure these problems by issuing handbooks for adjudication in various subject areas….The Research Office and other divisions of the Court compile adjudication handbooks such as Sifa Shouce [司法手册] (Judicial Handbook), many of which are internal publications.
Some of those historical handbooks can be found in my research library of Supreme People’s Court publications–see here and below:
Two Administrative Litigation Judicial Handbooks and the second volume of the Judicial Handbook
Why would specific divisions of the SPC return to the practice of issuing judicial handbooks in printed form? How does it link with the role of the SPC? What sources have the editors included, and what could students, scholars, and practitioners learn from that?
Official reasons for publishing these print books
The authors of the Administrative Litigation User’s Guide describe the reasons for publishing the book as follows:
the Supreme People’s Court, on the one hand, provides professional guidance (业务指导) by formulating judicial policies 司法政策), issuing guiding cases, and making judicial replies (司法答复); on the other hand, it strengthens research and collects problems, and formulates judicial interpretations based on the accumulation and maturity of judicial practice. At present, the comprehensive judicial interpretation of the Administrative Litigation Law, the judicial interpretation of administrative agreements, and the judicial interpretation of the appearance of administrative agency heads in court to respond to lawsuits have been formulated and issued…, and there are more and more normative documents and guiding cases related to administrative litigation. In addition, with the increase in the number of administrative cases, more judges have joined the administrative trial team. In the process of gradually becoming familiar with administrative litigation, they urgently need to master the relevant provisions that have been issued and learn the relevant guiding cases. However, judicial replies are internal in nature, with a large volume and lack of a unified release mechanism. The channels for obtaining them from the outside world are limited, which is time-consuming and laborious.
According to the announcement, the audience for the Administrative Litigation User’s Guide is staff in administrative agencies, judicial practitioners, and researchers of administrative law [students and academics]. The editors note that to provide readers with reference materials and to make the book more practical, they have included guiding cases, SPC Gazette Cases, and typical cases from the last 10 years.
The #4 Civil Division authors/editors say their handbook is urgently needed by front-line judges and as a reference book for judges, arbitrators, lawyers, and other practitioners, and, I would add, to students and scholars seeking to decode the foreign-related and Hong Kong, Macau, and Taiwan-related operations of China’s judiciary.
Legal basis for publishing these books
Publishing these books is linked to Article 10 of the Organic Law of the People’s Courts and relateddocuments, which authorize the SPC to supervise and guide（监督指导) the lower courts.
Comments on the content
Both books contain judicial interpretations and a range of SPC guidance documents such as meeting minutes/conference summaries (会议纪要), notices, and replies to requests for instructions, signaling to the reader that they are important sources of reference for judges and that “soft law” may understate the way that meeting minutes are understood within the Chinese court system.
The authors/editors of the Foreign-Related Handbook included many other types of legal provisions they considered relevant for hearing cross-border cases, such as relevant national legislation, administrative regulations, such as foreign exchange regulations, Chinese versions of international commercial rules (Incoterms, ICC Uniform Rules for Demand Guarantees (URDG 758), ISP 98) ), Hague Conventions to which China has acceeded, and civil judicial assistance treaties, as well as some of the National People’s Congress Standing Committee decisions related to some of the international conventions. The #4 Civil Division did not include guiding, typical cases, and other types of cases it issues for reference. In my view, it was a practical decision that does not imply that those types of cases are irrelevant to judges hearing cross-border commercial cases, but rather that including cases would make the book too long to be published as a single volume.
Comment
The underlying rationale for publishing these judicial handbooks has not changed much in the past 30 years. Judges responsible for processing cases efficiently and correctly face similar challenges: sorting out the current legal position on an issue quickly despite the piecemeal way that the SPC develops the law, locating and assessing the validity of historical documents, easily identifying special arrangements, and for cross-border cases, understanding how to correctly implement international conventions, treaties and practices and correspondingly arrangements or related provisions concerning cases involving Hong Kong, Macau and Taiwan parties.
One experienced senior judge in a local court noted that judges are often asked to rotate among divisions (tribunals) periodically. Senior judges recommend that new joiners read these handbooks to familiarize themselves quickly with a different (and complicated) area of law.
From the left, the 2024 Foreign-Related Handbook, a 2013 Hong Kong, Macau, Taiwan Related Judicial Handbook, and the 1992 Foreign, Hong Kong, Taiwan-Related Civil Matters predecessor volume
As most readers of this blog know, developing foreign-related rule of law is a priority for the Chinese government. President Zhang Jun told Supreme People’s Court (SPC) leaders at the beginning of 2025 that the Party Center places a great deal of importance on the construction (development) of foreign-relatedrule of law (党中央高度重视涉外法治建设). What does that mean for the SPC? What has the SPC done lately? This post briefly notes some of those developments.
The SPC’s #4 Civil Division has recently established a WeChat public account entitled 中国涉外商事海事审判, as a way of better conveying developments to the Chinese professional and academic legal world. The link is to the April 30 report on the China International Commercial Court’s circuit visit to Shanghai on 10-11 April.
The China International Commercial Court (CICC) held a hearing in Shanghai’s #1 Intermediate Court on 10 April in a joint venture shareholder dispute (see the photo above). I could attend because I was scheduled to participate in a workshop at NYU Shanghai on 12 April and several people bound by protocol to remain anonymous helped workshop participants and me with the required formalities. Many from Shanghai’s “foreign-related” legal community attended the hearing, including several foreign lawyers, senior members from the Shanghai International Arbitration Center, Shanghai Commercial Mediation Center, and academics from Shanghai’s law schools specializing in foreign-related matters. Official reports on the event included the SPC’s officialwebsite, the Shanghai #1 Intermediate People’s Court WeChat account (bilingual), and the #4 Civil Division’s WeChat account. I have my views on the performance of the lawyers, but will withhold them until I know more about the length of time they had for preparation.
Unbeknownst to most, the hearing in Shanghai evidenced that the CICC was implementing part of Article 33 of the sixth judicial reform plan:
Deepen the reform of the circuit trial mechanism. Deepen the reform of the circuit court work mechanism of the Supreme People’s Court, strengthen the functions and roles of the Supreme People’s Court’s trial organs in shifting their focus downward, resolving disputes on the spot, and facilitating litigation for the parties. 强化最高人民法院审判机关重心下移、就地解决纠纷、方便当事人诉讼的功能作用。
Holding a hearing in Shanghai would be considered to be “shifting the focus of the SPC downward,” resolving disputes on the spot, and facilitating litigation for the parties.
The SPC issued 《最高人民法院关于人民法院为西部陆海新通道建设提供司法服务和保障的意见” Opinions of the Supreme People’s Court on the People’s Court Providing Judicial Services and Guarantees for the Construction of the Western Land-Sea New Corridor” along with related typical cases. An explanation of the Western Land-Sea New Corridor is here. The document designates the Chongqing High People’s Court to take the lead in establishing a “13+2” judicial cooperation mechanism among thirteen high people’s courts and two intermediate people’s courts along the corridor to cooperate in litigation services, substantive dispute resolution, enforcement linkage, application of law, talent training, etc.
SPC Justice Wang Shumei published an article in China Trial (中国审判) on foreign related matters in late 2024. Her article is a useful summary of current SPC policy on foreign-related commercial and maritime matters. One part includes:
improve the rules for jurisdiction over foreign-related cases, and properly handle international conflicts of jurisdiction arising from parallel litigation involving multiple countries in the same dispute in accordance with the law; we must firmly maintain the international order based on international law, actively participate in the formulation of international rules, carry out in-depth international judicial exchanges and cooperation, strengthen confidence in the rule of law, actively explain to the world the concepts, propositions and successful practices of foreign-related rule of law with Chinese characteristics, promote the progress of international rule of law, promote global governance in a more just and reasonable direction, and help build a community with a shared future for mankind.
The above quotation summarizes what has been said in earlier documents: resolving parallel litigation is on the agenda; the Chinese courts should tell China’s story well; the SPC should actively participate in formulating international rules (actively participating in the negotiation of the Hague Judgments Convention as an example), and all is linked to the Chinese government’s vision of global governance and the international legal order.
3. Typical cases
In late April 2025, the SPC issued a group of typical cases linked to the Western Land-Sea Corridor and the policy document mentioned above, signaling the importance of mediation, unifying standards, promoting the application of international treaties and conventions, etc.
In March 2025, the SPC issued a second group of typical free trade zone cases第二批服务保障自由贸易试验区建设典型案例
As I mentioned in an earlier post, the SPC issued typical cases protecting the rights and interests of foreign investors.
As mentioned in an earlier post, in March, 2025, the SPC issued procedures to implement the Foreign State Sovereign Immunity Law.
Forthcoming attractions
Among the forthcoming attractions of which I am aware:
The #4 Civil Division is drafting a judicial interpretation of the foreign-related part of the Civil Procedure Law, as reported in official media. Judge Guo Zaiyu, who was one of the judges of the CICC panel hearing the case at the #1 Intermediate People’s Court, chaired a meeting with scholars and experts, hosted by East China University of Political Science and Law, including some (domestic) CICC experts in Shanghai on April 11. I surmise the judicial interpretation will be issued sometime this year and it is unclear whether a draft will be released for public consultation.
2. As mentioned earlier, the 6th judicial reform five-year plan outline was issued in late December. Point 12 relates to foreign-related rule of law:
Improve the judicial guarantee mechanism for high-level opening up. Improve the foreign-related trial mechanism, strengthen international commercial trial work, and improve the connection mechanism with international commercial mediation and arbitration. Improve the judicial trial system in which the parties in foreign-related civil legal relations agree on jurisdiction and choose to apply foreign laws in accordance with the law. Improve the mechanism for accurate application of international treaties and international practices, and improve the mechanism for ascertaining foreign laws. Improve the maritime trial mechanism, promote the improvement of the maritime legal system, improve the rules for adjudicating disputes such as ship repair, cross-border logistics, shipping insurance, maritime finance, and compensation for damage to the marine ecological environment, and improve the coordination and linkage mechanism with maritime administrative law enforcement agencies. Improve the mechanism for mutual recognition and enforcement of cross-border arbitration awards and civil and commercial judgments. Improve the judicial protection mechanism for overseas interests and investments. Improve the judicial protection mechanism for overseas Chinese interests. Improve the talent training mechanism for foreign-related trials. Strengthen international exchanges and cooperation in the judicial field, and actively participate in the formulation of international rules.
It appears most of the content here is not new and has been incorporated in the policydocumentspreviously analyzed on this blog. The major exception is the detailed stress on certain maritime case principles. Why has this paragraph been incorporated in the judicial reform plan outline, when previously this type of content would more likely have appeared in a specialized policy document? As I will comment in a future article, it is representative of many articles in this judicial reform plan outline, signaling that the Party and SPC leadership attach importance to those matters.
At the end of September (2023) the Supreme People’s Court (SPC) issued its fourth group of Belt & Road (BRI) Typical /Model /Exemplary ) (this post will use the translation “typical”) Cases (第四批涉“一带一路”建设典型案例) (see an alternative link in case the official website is unavailable). An English translation is available here. Along with the cases, the SPC issued a press release in the form of answers by a responsible person of the SPC’s #4 Civil Division to a reporter’s questions (为高质量共建“一带一路”提供有力司法服务和保障——最高人民法院民四庭负责人就发布第四批涉“一带一路”建设典型案例相关问题答记者问).
“For the avoidance of doubt,” the points made by these typical cases (please see last year’s blogpost for a refresher on typical cases) apply to all types of foreign-related cases, whether or not they involve the BRI in some way. Including “BRI” in the title highlights that these cases contribute to supporting the BRI (on the 10th anniversary of the strategy) and developing (“constructing” 建设) “foreign-related rule of law.” I’ll make several quick points about the cases and derive some useful information from the press release.
1. Typical cases
This group of 12 typical cases includes:
three cases relating to letters of credit and demand guarantees (#3 Jiangsu Puhua Co., Ltd. v. Bank of East Asia (China) Co., Ltd. Shanghai Branch; #4 China Power Construction Group Shandong Electric Power Construction Co., Ltd. v. GMR KAMALANGA Energy Ltd., et al (the SPC case was mentioned in this blogpost; and #5 Union of Arab and French Banks (UBAF) (Hong Kong) Ltd. [UBAF (Hong Kong) Ltd.] and Bank of China Co., Ltd. Henan Branch);
Two cases involving professional services-related issues (#6 Fusheng (Tianjin) Financial Leasing Co., Ltd. v. Grant Thornton AG (a tort case) and #8 Tianwei New Energy Holdings Co., Ltd. v. Davis Polk & Wardwell LLP (contract dispute));
Enforcement of a foreign (Singapore) court judgment (#12, enforcement application by Shuang Lin Construction Pte. Ltd. ). The SPC and the Singapore Supreme Court have a related memorandum so it is unsurprising that a case involving an application to enforce a Singapore judgment was selected. See this 2023 factsheet with a listing of the other Singapore agreements with the SPC);
Enforcement of foreign and Hong Kong arbitral awards (#10, China Small and Medium Enterprises Investment Co., Ltd. v. Russian Sakhalin Seafood Co., Ltd. & Oriental International Economic and Technical Cooperation Company, objection to enforcement case)( #11 Noble Resources International Pte. Ltd.’s application for recognition and enforcement of the Hong Kong International Arbitration Center arbitration award);
One case involving the Convention on the International Sale of Goods (CISG), #1, Exportextil Countertrade SA) and Nantong Meinite Medical Products Co., Ltd;
One case involving financial derivatives (#9, Standard Chartered Bank (China) Co., Ltd. v. Zhangjiakou United Petrochemical Co., Ltd.) ;
One equity transfer-related case (#7, a China International Commercial Court case), Zhang Moumou and Xie Moumou v. Shenzhen Aoxinlong Investment Co., Ltd;
One treaty interpretation case (#2, Nippon Property & Casualty Insurance (China) Co., Ltd. Shanghai Branch and others and Robinson Global Logistics (Dalian) Co., Ltd).
The press release ties the work of the SPC to the January 2018 Party Central Committee and State Council General Office policy document on BRI dispute resolution (summarized here and discussed further in my “neverending article”) and flags that the SPC has conscientiously implemented the decisions and arrangements of the Party Central Committee. The one-year gap between the third and fourth groups of typical BRI cases signals that the SPC leadership considers this a priority area. The phrase at the beginning of the press release (“providing powerful judicial services and guarantees (safeguards) for high-quality joint construction of the “Belt and Road”) signals the continuing importance of providing judicial “services and safeguards” for major national strategies, including the BRI, whether in the form of a document or typical cases.
3. Takeaways From the Press Release
a. CICC and other international commercial courts
The press release mentions the China International Commercial Court (CICC), its expert committee, and the establishment of local international commercial courts. The CICC has accepted a total of 27 international commercial cases, 17 of which have been concluded. A judgment was posted in July on the Chinese version of the CICC website but has yet to be translated.
Although the CICC is often linked to the BRI, the cases that the CICC has accepted include parties from jurisdictions that are not participating in the BRI, such as the United States. Among the typical cases released this time, one is a CICC case. The press release notes that the SPC will revise the CICC-related judicial interpretations to reflect the amendments to the foreign-related section of the Civil Procedure Law.
The BRI-related services and safeguards policy documents, about which I have previously written (and about which I have more to say in the neverending article) served as the policy framework for establishing local international commercial courts. The SPC has approved twelve local courts in Suzhou, Beijing, Chengdu, Xiamen, Changchun, Quanzhou, Wuxi, Nanning, Hangzhou, Ningbo, Nanjing, and Qingdao as “international commercial courts (tribunals).” It requires some detective work to determine the jurisdiction of each international commercial court.
b. Encouraging mediation and an organic connection between litigation, arbitration and mediation
The SPC reiterates its accomplishments in establishing a “one-stop” diversified resolution mechanism for international commercial disputes to achieve an organic connection between litigation, arbitration, and mediation. As mentioned in the 2022 report, ten international commercial arbitration institutions and two international commercial mediation institutions are part of the SPC’s “one-stop” mechanism.
c. Improving rules in foreign-related commercial cases
On improving the system of applicable rules for foreign-related commercial laws and unifying judicial standards, the spokesperson flagged that the SPC issued the Conference Summary [Meeting Minutes] on Foreign-Related Commercial and Maritime Trial Work (Foreign-Related Commercial & Maritime Law Conference Summary (Chinese and bilingual versions) (see my previous blogpost on the document), setting forth the SPC’s views on 111 issues in foreign-related matters. In my “neverending article,” I describe conference summaries (会议纪要 ) as intermediate documents, issued after courts confront new issues arising from a major policy document or new situation when the approaches of the lower courts need to be harmonized but it is not yet appropriate to issue a judicial interpretation. A book recently published by the drafters of the Foreign-Related Commercial & Maritime Law Conference Summary （《全国法院涉外商事海事审判工作座谈会会议纪要》理解与适用） reveals that after the #4 Civil Division prepared an initial draft, they “broadly sought comments” from relevant SPC departments, relevant State Council ministries and commissions, and selected experts. That means that the document represents a greater consensus of the relevant institutions on the issues addressed than commentators realized.
Additionally, in the past ten years, the SPC has issued guidance on foreign-related matters to the lower courts in the form of judicial interpretations (32), policy documents (9), guiding cases (18), and almost 150 typical cases. These statistics update those set out in the 2022 report.
d. Actively participating in legislation revision
As mentioned in the 2022 report, the SPC has actively participated in the revision of foreign-related laws such as the Civil Procedure Law (to come into effect next 1 January and the Arbitration Law (amendments ongoing, see this blogpost on the SPC’s contribution). My neverending article has a more extended discussion of this.
e. “Forthcoming Attractions”
The press release flags some “forthcoming attractions” related to the SPC’s foreign-related judicial work.
The SPC is (and has been) working on several relevant judicial interpretations (as mentioned in earlier blogposts).
a. Coming soon is the Interpretation on Several Issues Concerning the Application of the “Law of the People’s Republic of China on the Law Applicable to Foreign-Related Civil Relationships” (2) (关于适用〈中华人民共和国涉外民事关系法律适用法〉若干问题的解释（二）. The spokesperson revealed that the judicial interpretation had already been approved by the SPC’s judicial committee. It incorporates provisions relating to ascertaining foreign laws.
b. As mentioned above, the SPC will revise the CICC-related judicial interpretations to reflect the amendments to the foreign-related part of the Civil Procedure Law. The press release does not mention amending the comprehensive judicial interpretation of the Civil Procedure Law to reflect those amendments, but I surmise those are also being contemplated.
c. A third judicial interpretation, the “Interpretation on Several Issues Concerning the Application of International Treaties and International Practices in the Trial of Foreign-Related Civil and Commercial Cases”（关于审理涉外民商事案件适用国际条约和国际惯例若干问题的解释） is still in draft. Because the original provisions on the application of international treaties in the General Principles of Civil Law were abolished when the Civil Code was promulgated, leaving the rules for the application of international treaties unclear, the SPC is drafting an interpretation to deal with a group of issues. Those include the application of international treaties, the relationship between party autonomy and the application of international treaties, the choice of application of international treaties that are not in force in China, the application of international practices (two typical cases discuss the application of the Uniform Customs & Practice for Documentary Credits (UCP 600) and public order treaty reservations.
2. Databases on foreign law and expertise on foreign law.
With the support of some CICC expert committee members, one of the SPC’s BRI research databases and foreign law ascertainment service agencies, a foreign (non-mainland Chinese)legal database with legislation, international law documents and other legal information on ten ASEAN countries, seven South Asian countries and the ASEAN international organization has been created. Separately another service provider has created a BRI expert legal database. The 2022 report flagged these developments.
3. Judicial materials and training on foreign-related matters
The Supreme People’s Court is compiling a “Compilation of Common Laws and Regulations in Foreign-related Civil and Commercial Matters” to assist new hires and will increase the training and guidance to improve judicial competence on the application of international treaties. Improving judicial training on foreign-related matters has been an ongoing issue. Post-Covid, a number of training programs for judges and judges assistants on foreign-related matters have been held.
The most recent one was a national program, held at the National Judges College, focused on training senior personnel in foreign-related matters, at which Justice Tao Kaiyuan spoke. Those speaking at the program (from the relevant departments) included representatives from the Central Foreign Affairs Commission, the Legislative Affairs Commission under the National People’s Congress Standing Committee, Ministry of Foreign Affairs, Ministry of Commerce, as well (presumably) senior personnel from the SPC’s #4 Civil Division and the International Cooperation Bureau (which deals with treaty negotiation and judicial assistance matters). Local courts that have run such programs include Beijing (with the assistance of the University of International Business and Economics).
4. Judicial Assistance
China has concluded 171 bilateral judicial assistance treaties with 83 countries and has acceded to nearly 30 related international conventions (no change from October, 2022). In contrast to twenty or even ten years ago, the number of judicial assistance matters dealt with by the Chinese courts has increased. The press release mentions improving the quality and efficiency of international judicial assistance such as better cooperation in the cross-border service of judicial documents, cross-border investigation and evidence collection, ascertainment of foreign law, and recognition and enforcement of foreign (extra-territorial) judgments and arbitral awards. This does not yet mean that it is possible for foreign litigators to take depositions in mainland China for foreign court proceedings. Service of process was an issue in this 2022 case in the Southern District of New York.
In January 2022, the Supreme People’s Court (SPC) issued a Conference Summary [also translated as “Meeting Minutes”] of the National Symposium on Foreign-Related Commercial and Maritime Trial Work (Foreign-Related Commercial & Maritime Law Conference Summary (bilingual version here) (全国涉外商事海事审判工作座谈会会议纪要). From unauthorized versions released, it can be seen that it was another SPC year-end accomplishment. Although this document is not a judicial interpretation and cannot be cited in Chinese court judgments, it is crucially important for legal professionals outside of China dealing with cross-border commercial issues involving China and for Chinese legal professionals focusing on cross-border commercial issues involving the rest of the world.
The conference summary has 111 provisions. The focus is on legal issues because the target audience of domestic judges understands the political framing. The conference summary applies to foreign-related cases and to Hong Kong, Macau, and Taiwan-related cases by reference (see Article 111, set out at the end of this post). They are in the following categories:
foreign-related commercial (涉外商事部分), the longest:
Maritime (海事部分);
Judicial review of arbitration (仲裁司法审查部分).
This blogpost will explain why the conference summary was issued, its legal and policy basis, and why it addressed those particular issues and will leave the majority of the content of the conference summary for the experts in practice and academia.
Why this conference summary?
The conference summary (meeting minutes) is based on a national conference on foreign-related commercial and maritime trial work held in Nanjing in June of last year and the issues that the SPC would have heard raised by lower court judges.
When asked the question of why this conference summary was issued, an SPC judge is likely to say “to resolve difficult issues in practice and unify judgment standards.” But a fuller answer to this question for a larger audience requires further details.
As to why a conference summary and not rely on “case law” with Chinese characteristics, including China International Commercial Court cases, SPC cases, and various types of typical or SPC selected cases as “soft precedents,” the answer is that the SPC is issuing this conference summary to guide lower court judges (and possibly judges in other divisions of the SPC) practically and efficiently and for some additional reasons. The simple answer is that “case law” is not effective enough to practically guide lower court judges. If it were, the SPC would not have issued this document. I have seen a number of academic articles (in English) that illustrate a misunderstanding of what the SPC is doing.
Additionally, I surmise that at the Nanjing conference, behind closed doors, SPC judges heard about inconsistent approaches or requirements from lower court judges. I surmise they also heard from lower court judges uncertainty in the approach that they should take concerning issues where the law is unclear. The judicial evaluation system values deciding cases correctly. Moreover, the most recent SPC policy focuses on unifying the application of law. Its leadership has established a leading small group to that end. So for all these reasons, lower court judges would look to the SPC for clarification. What is contained in the conference summary is the SPC’s current consensus on major cross-border commercial, maritime, and arbitration review-related issues, based on their further research and consideration.
In the busiest courts where many of these cases arise, judges are under enormous pressure to decide cases timely and accurately, especially after the recent changes to the jurisdiction of lower courts under the reorientation of the four levels of the people’s courts and the issuance of other documents changing the jurisdiction of the lower courts in commercial cases. “Codifying” the principles from cases and issues considered by the SPC in the form of a conference summary is the most useful and efficient form of guidance for lower court judges. As mentioned here, although conference summaries are not judicial interpretations and cannot be cited in a court judgment document as the basis of a judgment, they provide important guidance to the work of the courts concerning issues about which existing law and judicial interpretations are unclear. Judges will rely on its provisions to decide cases.
The legal basis for the conference summary derives from the SPC’s authority under Article 10 of the Organic Law of the People’s Courts to supervise the lower courts.
As for an answer to the question of why not issue a judicial interpretation–time, fluidity, and attenuated basis for some of the conference summary’s provisions do not permit a judicial interpretation to be issued. One example of the attenuated basis and fluidity is Article 100, which”codifies” the Guangzhou Intermediate People’s Court decision in the Brentwood case (discussed here). It establishes welcome certainty to the enforceability of arbitral awards made by overseas arbitration institutions arbitrations seated in Mainland China. It provides that such awards are regarded as foreign-related arbitral awards (rather than foreign awards) in Mainland China. It is likely to be helpful to the overseas arbitration institutions that are considering establishing case management offices in China, as is now possible under Shanghai and Beijing regulations. As mentioned before, the Arbitration Law being revised, the current draft addresses the issue, and the SPC is likely to issue a comprehensive judicial interpretation thereafter.
Moreover, for some of the procedural provisions, such as those relating to the recognition and enforcement of foreign judgments, it gives the SPC a chance to pilot its guidance, before formalizing it in the form of a judicial interpretation. A recent Wechat article (with further details) flags that in 2021, three foreign judgments and nine Hong Kong, Macau, and Taiwan judgments were recognized and enforced. Likely more applications were made but not decided.
Other provisions consolidate existing guidance in a form that is easier for the lower courts to grasp quickly. Article 22, on obtaining an opinion on foreign or international law from a China International Commercial Court (CICC) expert committee expert, for example, repeats what is to be found in CICC guidance. The same can be said about Article 11, on the topic of electronic service of process, promoted in several Belt & Road-related SPC Opinions. It should be noted that China maintains its traditional approach to service of process from foreign jurisdictions.
Articles 18-20 address a few of the ongoing issues related to the application of international conventions and treaties in the Chinese courts. Article 18 answers the question of what a court should do if the relevant treaty or convention is silent or China has made a reservation on that issue. The answer is to use the Law on the Laws Applicable to Foreign-Related Civil Relations to determine the applicable law. Article 20 focuses on what a Chinese court should do if it is applying Chinese law if Chinese law has conflicting positions and China has acceded to a relevant treaty or convention. A report on a recent workshop involving the SPC, the Beijing #4 Intermediate People’s Court, and academics from the China Academy of Social Sciences and other institutions flags some of the many other unresolved issues.
Article 30 addresses an important question for Chinese and foreign banks, suppliers to Chinese EPC contractors, and project owners, particularly in Belt & Road jurisdictions–how easily can a Chinese court stop payment on a demand (independent) guarantee? The answer is, strictly according to the provisions of the relevant judicial interpretation. Article 30 provides that when a court hears an application to stop payment on the basis of fraud (which can be filed as a preliminary matter or during the course of litigation or arbitration), it must examine the independent letter of guarantee stop payment application submitted by the parties in according to Article 14 of the (updated) Provisions on Several Issues Concerning the Hearing of Independent Letter of Guarantee Dispute Cases, and conduct a preliminary substantive examination on whether there are fraudulent grounds for stop payment in accordance with the provisions of Article 12 and set out its finding of facts and reasoning as required by Article 16.
The Bigger Picture
This conference summary is another form of SPC soft law. It harmonizes the decisions of the Chinese courts to be consistent with SPC policy (or said another way, strengthens the firm guiding hand of the SPC).
This document reflects the awareness of its drafters, the judges of the #4 Civil Division of the SPC, that the issues that come before the Chinese courts far outpace the infrastructure of Chinese foreign-related commercial law. Given the larger trends I described in my brief article last fall, we can expect the SPC to continue to play an important role in developing China’s body of law related to cross-border commercial matters.
_____________________________________
111.【涉港澳台案件参照适用本纪要】涉及香港特别行政区、澳门特别行政区和台湾地区的商事海事纠纷案件，相关司法解释未作规定的，参照本纪要关于涉外商事海事纠纷案件的规定处理)。111. [The application by reference of this conference summary to cases involving Hong Kong, Macao and Taiwan]. As for commercial and maritime cases involving the Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan, which are not otherwise stipulated in relevant judicial interpretations, shall be handled with reference to the provisions of this conference summary on foreign-related commercial and maritime cases.
President Zhou Qiang visiting the University of International Business & Economics
Since the Fourth Plenum of the 19th Party Congress, and especially since President Xi Jinping spoke about the need for China to train foreign-related legal personnel (涉外法治人才), the Supreme People’s Court (SPC) press, SPC leadership, and others important to the SPC leadership, such as Shen Deyong, former executive vice president of the SPC and current leaders of the CPPCC have reiterated the importance of “foreign-related legal personnel” to China and the people’s courts. Training “foreign-related legal personnel” is incorporated into the Party’s Plan for Building the Rule of Law (2020-2025), an indication of its importance. Shen Deyong criticized the way that “foreign-related legal personnel” is used within government institutions– “team is too small, their numbers are too few, they are scattered and the market is chaotic.””涉外法律服务人才队伍建设还存在一些问题和不足，主要呈现队伍“小”、人才“少”、分布“散”、市场“乱”的特点. I would add to the issues that he flagged that policies directed towards attracting “foreign-related legal personnel” to the courts inevitably encounter the special characteristics of the courts’ personnel system as it has evolved since the quota judge reform was implemented, both the training system and especially career advancement from judges assistant to quota judge.
As readers of this blog know, the Chinese courts need “foreign-related legal personnel” in many areas. Those include working on cross-border cases across a broad range of procedural and substantive areas, undertaking research related to cross-border judicial policy and cross-border legal issues that have an impact on the judiciary, as well as working on a range of issues related to the SPC’s and lower courts’ interactions with the outside world.
Law students apply to become judges assistants after graduation for a variety of reasons. Some become further interested after internships (see this blogpost on SPC interns–a version with more data may appear later). Other law school graduates are motivated by presentations by outstanding judges at their law school (SPC Judge Gao Xiaoli’s 2015 talk at the Peking University School of Transnational Law earned her many new fans), while still others recognized that a job “in the system” would resolve their hukou problems and enable them to live in Beijing, Shanghai, or other major cities. Yet others are motivated to use their education in the service of the public. I can say with authority that law graduates with knowledge of transnational law, fluency in English (and other foreign languages) are working as legal assistants in courts all over China. Recruitment of legal assistants is a local matter, so the #4 Civil Division of the SPC (in charge of foreign commercial matters) and likely the Political Department of the SPC (in charge of personnel) lacks statistics on the number of “foreign-related legal personnel” working in the local courts.
Special characteristics of the courts’ personnel system
I write about the judiciary’s personnel system with some trepidation as I am well aware that my knowledge of the regulatory system is incomplete. (Some of the relevant regulations cited in analyses of the personnel reforms are not accessible to those outside the court system.) On the issue of placement of junior “foreign-related legal personnel,” I have not heard from either knowledgeable persons, former students, or other junior personnel in the Chinese court system that specific policies have been implemented within the court system (the Political Department of the SPC is responsible at the national level, and locally, political departments of local courts are responsible) to channel judges assistants recruited from China’s law schools with transnational training and experience into roles in which their academic background can be used and their “foreign-related” legal skills can be developed. In the absence of specific policy, too many local court leaders appear to see the young people with a transnational legal background and experience merely as workers that can be put to work in the national judicial machine (司法民工). Judges assistants from higher courts are sometimes sent down to the local level to work for two years, in line with young cadre development policy.
Training
If the three documents cited above have language about training, it seems likely that a training plan is somewhere in the approval pipeline. My guess is that this is yet another matter that requires coordination among multiple institutions within the SPC, including the #4 Civil Division–the ones asking for the training to be done, with the Political Division and the National Judges College. As I wrote last year, a new national court training plan (2019—2023年全国法院教育培训规划)) is underway. As senior leadership has called for cultivating “foreign-related legal personnel,” it seems likely that the SPC will eventually issue (perhaps not publicly) a training plan for judges handling all sorts of foreign-related issues, both civil-commercial and criminal.
Career advancement
Another issue for foreign-related legal personnel in the courts is career advancement for judges assistants. As I mentioned in passing in an earlier blogpost, career advancement from judges assistant to quota judge has slowed. Specific promotion criteria are set locally. Local studies have been done on the role of the judges assistant but have not surmounted the language barrier (see this one from one of the Chongqing Intermediate People’s Courts) that provide specific data and specific analysis deriving from local conditions. From my observations, fixed quotas on the number of judges in a court can mean a talented, educated judges assistant in one court may wait significantly longer than a similarly qualified person in another court to become a judge.
Concluding thoughts
Unless the SPC can evolve better national policy directed towards a career for “foreign-related legal personnel,” some of them will leave, disappointed with the failure of the judicial system to use their talents, despite the official publicity. There will be many companies and law firms, some dealing with the issues I described previously, that will value them.
SPC Press conference announcing the policy document
On the afternoon of 25 September, the Supreme People’s Court (SPC) issued yet another guiding opinion providing services and guarantees, this one on providing services and guarantees in support of expanding opening to the outside world (Services & Guarantees to the Open Policy Guiding Opinions (Guiding Opinions)) (最高人民法院关于人民法院服务保障进一步扩大对外开放的指导意见). It was approved by the SPC’s Party Group, as was BRI Opinion #2.
Senior legal officials from the Ministry of Commerce (MOFCOM) and the Ministry of Foreign Affairs (MFA) spoke at the SPC press conference, in what this observer views as a cross-institutional show of support for China’s policies of opening to the outside world. At a time that government officials are focused on “dual circulation,” it is a reminder that the opening to the outside world policy remains in place and that one of the SPC’s many responsibilities is to handle those issues properly. The photo is also one illustration of the place of the SPC within China’s system (体制).
SPC Vice President Yang Wanming (杨万明) spoke first at the press conference, with the officials from MOFCOM and MFA adding comments. This signalled to the careful observer that he has assumed the responsibility for overseeing the #4 Civil Division (responsible for foreign-related commercial and maritime matters) from Luo Dongchuan (who has been transferred to Fujian Province to serve as Political Legal Commission Party Secretary).
This brief (17 articles) guiding opinion providing judicial services and guarantees (not a judicial interpretation, see this explanation of what it is) is the latest judicial policy on foreign-related (this blogpost will use the term “cross-border”, to incorporate some Hong Kong-related) legal issues (inbound and outbound) relevant to the Chinese courts, drawing on BRI Opinion #2 (issued end 2019 and BRI Opinion #1) and the June, 2020 guidance on Covid-19 and cross-border commercial issues.
As to what those judicial services and guarantees are, Justice Yang said the following:
Wherever the national strategy is deployed, the judicial services and guarantees of the people’s courts will be there (国家战略部署到哪里，人民法院司法服务和保障就到哪里.)
How does this document relate to other Chinese legislation?
To clarify the relationship between this opinion on the one hand and legislation, judicial interpretations and other types of judicial documents (such as the two BRI Opinions), Justice Yang gave a quick summary in SPC jargon:
While maintaining consistency with existing laws and regulations, judicial interpretations, and judicial policy documents, the Guiding Opinions also strengthen the macro-guidance of the people’s courts’ services and guarantees opening to the outside world from a higher level, and are organically linked to other SPC judicial policy documents for major opening-up decisions, major strategies, and major initiatives, to further improve the system of judicial services and guarantees of the work relating to opening to the outside world与现有法律法规和司法解释、司法政策文件保持一致的同时，从更高层面加强人民法院服务保障对外开放工作的宏观指导，与最高人民法院出台的其他司法服务保障国家对外开放重大决策、重大战略和重大举措的司法政策文件有机衔接，进一步完善了司法服务保障对外开放工作体系。
What is means is:
The Guiding Opinions are intended to be consistent with current law and regulations, SPC judicial interpretations, and SPC judicial policy documents.
It is intended to provide comprehensive guidance and better support government policies on opening to the outside world.
The Guiding Opinions. like many of the documents analyzed on this blog, are written in SPC jargon. Decoding this language poses challenges to those are concerned or who should be concerned about the impact of how the Chinese courts interact with the rest of the world.
Decoding the language, however, enables the careful reader to understand outstanding issues and contemplated reforms or other measures, including possible judicial interpretations.
Summary and comments
This blogpost will summarize and make some brief comments on some of the issues mentioned in each of the six sections of the documents and make a few concluding comments. There are many more issues in this document that should be explored, but I’ve been delayed by a hand injury.
1. Political stance
The first section calls for judges to raise their political stance. This is standard language in the New Era. The first article frames the documents in current political language, including that frequently used in Chinese foreign policy documents and to relevant political documents. Therefore the first article (and elsewhere) refers to multilateralism, equally situated parties, and creating a legalized, internationalized convenient business environment.
The second section focuses on basic principles of foreign-related litigation–of which it sets out three: protecting the equal rights of parties; respecting the intent of the parties; and implementing (judicial) jurisdiction according to law.
The second principle, described in Article 4, includes the right of parties to choose governing law, a court with jurisdiction and arbitration, litigation, or mediation to resolve their disputes. However, as mentioned previously, Chinese law treats choice of arbitration and litigation differently, requiring litigants choosing a (foreign court) to have an actual connection to the foreign court (see Professor Vivienne Bath’s previous scholarship on this), although there isn’t a counterpart position for arbitration. As mentioned previously, the application of foreign law by Chinese courts is a work in process. The SPC has given a great deal of publicity to its platform for the ascertainment of foreign law. which includes determinations of foreign law on a certain issue by certain authorized organizations and opinions given by members of the international expert committee of the China International Commerce Court (CICC). As I wrote close to two years ago, the China International Commercial Court (CICC) rules do not clarify a number of practical questions. Could a court request an advisory opinion from an expert and from a designated ascertainment center, and if so, what relative weight will be attached to each? Presumably, a court would give it greater weight than an opinion from an expert provided by a party.
The third principle, described more fully in Article 5, is linked to protecting China’s judicial sovereignty and repeats the statement that conflicts in jurisdiction and parallel proceedings will be resolved properly (妥善解决). This has appeared in BRI Opinions #1 and #2, but specific measures to resolve parallel proceedings have not yet been noted. Parallel and conflicting proceedings are an ongoing issue (not only between the Chinese courts and other courts outside mainland China) and will be further mentioned below. As Professor Bath discussed, several scenarios are common. One involves situations in which parties had agreed to the exclusive jurisdiction of the courts of one country, but a party brings proceedings in the courts another country (China), which accepts the case and may issue a judgment before the original court. Another set of cases involves an alleged arbitration agreement which provides for arbitration overseas, but a party brings a case in a Chinese court nonetheless. A variation has recently been noticed by two leading practicing lawyers in China. In that case, an issue that had been pleaded in arbitration proceedings in Hong Kong and reviewed by the relevant Hong Kong court was not given res judicata effect in China. The ruling by the Shijiazhuang court has been reviewed by the SPC under its Prior Review proceedings.
Although parallel proceedings in courts outside of China and in China have previously been noted primarily in maritime law (and anti-suit and anti-anti-suit orders),the parallel/conflicting proceedings issues seem to be moving to the area of Intellectual property (IP) law, likely related to the multi-jurisdiction litigation between Huawei and Conversant concerning standard essential patents, including in the UK Supreme Court and the German courts. What has been noted is one of the SPC’s research topics includes protecting China’s judicial sovereignty (national interests) through anti-suit or anti-anti-suit injunctions. The SPC Intellectual Property Court has issued an anti-suit injunction order against Conversant and the Wuhan Intermediate Court issued an anti-suit injunction order against Intel Digital (the linked article has a summary of the facts in the Wuhan case, but reserve judgment on the author’s comments on the authority of Chinese courts to issue these order).
3. Modernizing China’s foreign-related and maritime litigation systems
This third section contains four articles: application of law; fully develop the advantages of service and guarantees to cross-border trade and investment; promote the integration with the internet of foreign-related litigation; and develop diversified dispute resolution related to international commercial dispute resolution. Many of the provisions in this section repeat provisions in the BRI Opinions #1 and #2. What appears to be new is a statement that the SPC will seek to integrate prestigious foreign arbitration and mediation organizations to be part of its one stop mediation/arbitration/litigation mechanism.
4. Increase judicial protections
Article 10 mentions foreign-related administrative litigation issues. They were mentioned briefly in BRI Opinion #2 and once in BRI Opinion #1, here seeing greater stress. Section 11 focuses on cross-border intellectual property issues. It has some important new content. It mentions improving (完善涉外知识产权诉讼制度) foreign-related IP litigation procedures, putting into judicial policy previous statements by former Vice President Luo Dongchuan about the need for special IP litigation rules. It again mentions researching and responding to parallel international litigation relating to intellectual property rights and becoming a preferred place for settling IP disputes. From comments made by several leading experts in a recent webinar the Chinese courts are an important jurisdiction in IP litigation. It is unclear whether the use of anti-suit (or anti-anti-suit )injunctions by the Chinese courts will be the way that litigants are encouraged to turn to the Chinese courts to settle their global IP disputes. According to comments by several persons with expertise in Chinese IP law and related commercial issues, a number of factors are leading to the Chinese IP courts becoming an important forum for the resolution of IP disputes. Related to this, see the analysis by Doug Clark, partner in the IP law firm Rouse in this article, in which he says that the Chinese courts are looking to take on the role of setting global FRAND rates. Also see related blogposts on Mark Cohen’s blog, Chinaipr.com. These issues are complex and important.
5. Prevent and resolve major risks
This section has only two articles. Article 13 focuses on perfecting risk control mechanisms for major cases and firmly establishing an overall national security concept. These phrases are not unique to the SPC, but reflect language in Party documents, with the “overall national security concept” attributed to Xi Jinping. This article also calls on courts to coordinate the overall international and domestic situations, adhere to bottom-line thinking and risk awareness, understand the domestic and international situation and risks and challenges facing China’s opening up. The final phrase in this article calls on courts to resolutely defend our (China’s) judicial sovereignty and national security. So it seems that the concept of “judicial sovereignty” (used several times in this document) is being used to protect China’s national sovereignty.
The second one (Article 14), on guaranteeing state security and economic and social order gives a different priority to possible cross-border criminal law issues from either BRI Opinion. Neither BRI Opinion mentioned infiltration (渗透), espionage (间谍), sabotage, subversion (渗透颠覆破坏). Infiltration and espionage are mentioned immediately after the article heading. (the sentence is: “thoroughly participate in the struggle against infiltration, espionage, separatism, terrorism, and cults, by strictly combatting crimes of infiltration, subversion, and sabotage, and crimes of espionage, violent terrorism, ethnic separatism, religious extremism, and other crimes that endanger national security” 深入参与反渗透反间谍反分裂反恐怖反邪教斗争，严厉打击各种渗透颠覆破坏、间谍、暴力恐怖、民族分裂、宗教极端等危害国家安全的犯罪. (Many thanks to Chinalawtranslate.com for this translation). Other concerns, such as violent terrorism, ethnic separatism, religious extremism have been seen previously in the other two BRI documents. and article 14 again stresses criminal justice cooperation between China and the rest of the world. The reason for the change in priorities is unclear. What signal does this send to the international commercial and judicial world (international community) that infiltration, espionage, sabotage and subversion are being mentioned?
6. Increasing judicial cooperation, increase the international influence of the Chinese judiciary
These three articles address judicial cooperation, judicial exchanges, and training of judges who can handle foreign-related cases.
Article 15 concerns judicial assistance treaties, encouraging Chinese judges to participate in the negotiation of bilateral and multilateral judicial assistance treaties.
Article 16, on judicial exchanges, including highlighting exchanges with the principal international legal organizations, also summarizes ongoing SPC practices in developing exchanges with BRI judiciaries, although it is not so specified.
Article 17 calls for the better training, recruitment and promotion of persons who can deal with specialized legal issues such as cross-border finance, environmental protection, maritime law, intellectual property. Measures include joint programs with universities, exchanges with international organizations and international commercial courts, with the objective of having judges who are able to participate in the drafting or amendment of relevant international rules [a glimpse into a judiciary certain special functions] and the creation of a group of Chinese judges with an international perspective. This appears to be directed to law schools and senior personnel in the lower courts and likely involved concurrence by the SPC’s International Cooperation Bureau. As has been mentioned in earlier blogposts, the career progression for legal professionals to become judges has slowed because of the personnel reforms in the previous round of judicial reforms, under which young professionals work as judges assistants for a number of years before applying (and passing relevant examinations)to become a judge. From my observations, fixed quotas on the number of judges in a court can mean a talented, educated judges assistant in one court may wait significantly longer than a similarly qualified person in another court to become a judge.
A few concluding comments
Perhaps it is not realized that multiple documents conveying many of the same messages, with references that need decoding, may not convey the intended message to the international business community that the Chinese courts welcome and will treat fairly foreign commercial litigants, and that Chinese law is stable, transparent and predictable.
The Guiding Opinions call for increasing publicity about and the international influence of Chinese justice, and international confidence in Chinese law, through translating guiding and typical (exemplary/model) cases into foreign languages. This echoes language in BRI Opinion #2. The international community outside of China may or may not consider those sources to be primary ones in forming a view about the Chinese courts. In my view, it is more likely that the international community will look to decisions and rulings of the Chinese courts in several categories of cases: enforcement or other proceedings involving foreign (and Hong Kong) arbitral awards; parallel or competing proceedings, whether with other courts or with international arbitration; difficult commercial ones, particularly involving Chinese state-owned enterprises, or other Chinese national champions and issues related to intellectual property, particularly as it relates to “cutting-edge” technology. This observer surmises that the international judicial community will also look for a spirit of mutual respect for foreign courts and their jurisdiction.
The Guiding Opinions repeats language about Chinese courts participating in the formulation of international rules, an ongoing theme since the 2014 4th Plenum of the 18th Party Congress decision. One example is the constructive role of the SPC negotiator as a member of the Chinese delegation that participated in the drafting of the Hague Judgments Convention. But what the international community will also look for is China’s capacity to harmonize its legislation to be able to ratify the international conventions whose drafting it participates in.
The introduction to Guiding Opinions notes that comments were sought from many sources. It is unclear whether the views of international users of the Chinese court system were solicited. Other developments in which the international community may display an interest are the creation of additional institutions within the Chinese judiciary to enable the Chinese judiciary to better understand the needs of（domestic and international) users.
__________________________________________
Many thanks to several highly knowledgeable readers who commented on earlier drafts of this blogpost.
From left, Li Guangyu, SPC spokesperson; SPC Vice President Justice Luo Dongchuan; Judge Wang Shumei, head of #4 Civil Division
On 16 June, the Supreme People’s Court (SPC) held a news conference (pictured above), to announce that it had issued “Guiding Opinion on the Proper Handling of Civil Cases Involving the Novel Coronavirus Outbreak in Accordance with the Law (III)” (SPC Guiding Opinion III).” SPC Guiding Opinion focuses on the most important cross-border commercial issues that have arisen in the Chinese courts this spring as a result of the Covid-19 pandemic. This brief blogpost provides some comments and an overview of the document, leaving the detailed analysis to the law firms that are sure to analyze it.
What is this document?
SPC Guiding Opinion III is a judicial policy document (司法政策性文件). As this blog has often commented, the Supreme People’s Court (SPC) must serve the greater situation and deal with practical legal issues, so that the SPC itself and its senior leadership are correct, politically, and professionally. One of those ways is by providing properly calibrated guidance to the lower courts and other related authorities with the appropriate political signals. For this document, Justice Luo Dongchuan provided the political background and signals in his introductory remarks at the SPC news conference. The document itself is practically oriented (as those in the system say “problem-oriented”–“问题导向”)（and the practitioners say “干活”).
From the photo above it is clear that the #4 Civil Division, headed by Judge Wang Shumei, which focuses on cross-border commercial and maritime issues, took the lead in drafting. That division is one of the smaller divisions of the SPC and “punches above its weight.”
A judicial policy document is not a judicial interpretation but as the SPC editors of a collection of these documents noted, “it is generally recognized that they have an important guiding impact on the trial and enforcement work of the courts at every level.” SPC Guiding Opinion III is one example of the many types of SPC “stealth” guidance to the lower courts. I describe it as “stealth guidance” because it affects how cases are handled, heard, and decided, but cannot be cited in a court judgment or ruling. For that reason, only the highly observant will note the impact of judicial policy documents.
I anticipated that the SPC would issue further Covid-19 pandemic guidance when I spoke [links to video] in April at a virtual event sponsored by Berkeley Law School’s Center for Law & Technology. Some of the guidance reveals frequently used litigation tactics of Chinese parties.
Selected comments on the content
The document is divided into four sections:
Civil procedure mechanics–parties, evidence, deadlines, and statutes of limitations (Articles 1-5): This section draws on the recently amended and effective civil evidence rules
Article 1 directs Chinese courts to approve applications for extensions for foreign (cross-border) parties who are delayed in being able to provide notarized and authenticated documents to evidence the identity. Delays in obtaining notarized and authenticated powers of attorney are to be treated similarly. If China had acceded to the 1961 Hague Convention Abolishing the Requirement of Legalisation for Foreign Public Documents, for all of China, this requirement would no longer be necessary. The Convention is applicable to Hong Kong because of UK-PRC handover arrangements, which enabled conventions originally applicable to Hong Kong pre-1997 to continue in effect.
Article 3 reveals one of the frequently used litigation tactics of Chinese parties in cross-border litigation in China–that is disputing the authenticity of a document because it has not been properly notarized and legalized. The SPC Guiding Opinion III advises lower courts to notify parties that they may reserve their arguments concerning these formalities, and focus their arguments on relevance and persuasiveness of the evidence.
2. Ascertainment (determination) and application of law
These articles remind Chinese courts to use the Law of the People’s Republic of China on the Law Applicable to Foreign-Related Civil Relationships to determine governing law (assuming a contract does not designate a governing law), and to look to the SPC Guiding Opinion I for guidance on force majeure under Chinese law. The SPC also reminds lower court judges not to substitute Chinese law if foreign law governs. This is not the first time that this type of reminder has appeared in SPC policy documents, indicating this is an ongoing problem. This section also includes guidance on the application on the UN Convention on the Sale of Goods.
Articles 8 and 9 relate to letters of credit, standby letters of credit, and demand (independent) guarantees. It reminds lower courts to correctly apply the International Chamber of Commerce (ICC)’s UCP 600 (Uniform Customs and Practice for Documentary Credits), the ICC’s URDG 758(demand guarantee rules), and the related SPC judicial interpretation concerning demand guarantees.
This likely means that Chinese contractors who have provided independent guarantees or standby letters of credit for construction projects overseas are seeking to prevent the owner of the projects from drawing on these guarantees through litigation in the Chinese courts. This case decided by the SPC in April, 2020, reverses the judgment of the Shandong Higher People’s Court in favor of the Chinese contractor. The dispute relates to a Shandong Electric Power Company (SEPCO) project in India. Previous reporting in the Indian press seen here.
3. Transport contracts
Articles 11-17 relate to various types of transportation contracts as well as shipbuilding contracts.
4. Green channel.
This last section reminds courts to use online procedures and cross-administrative region arrangements if convenient and that Hong Kong, Macau, and Taiwan related commercial cases should be handled with reference to this guidance.
How was the document drafted?
As to how the SPC determined the FAQs of the lower courts, it did what all corporates and institutions around the world do these days–convened a video conference. The participants presumably came from the maritime courts and the foreign-related civil divisions of the provincial courts.
Why did the SPC issue it?
The number of cases directly affected by this guidance is relatively small. According to statistics released with President Zhou Qiang’s report to the NPC in May, there were 17,000 first instance foreign-related commercial cases and 16,000 foreign-related maritime cases in the Chinese courts in 2019, compared with 31.5 million cases in the Chinese courts overall.
However, foreign-related cases tend to be more sensitive because, as Zhou Enlai said “外事无小事” (foreign matters are never small matters” –foreign-related matters, because they involve relations with other countries and the prestige of the Chinese state, are sensitive. That means that judges hearing cross-border cases have a particular pressure to handle these disputes in a way that is consistent with the law (of course), acceptable to the leadership of their court & to the outside world. One important aspect of SPC Guiding Opinion III is the impact on Belt & Road projects, In many of these projects Chinese companies are often contractors, or also contractors and equipment suppliers (and Chinese banks provide financing). On the civil/commercial side cross-border cases possibly involve treaty/convention obligations (or treaty-like arrangements, in the case of Hong Kong).
As issues dealt with in SPC Guiding Opinion III relate to the most important Chinese cross-border commercial issues that have arisen during the pandemic, it has an impact on the Chinese (and foreign) business community, far beyond the number of foreign-related cases in the Chinese courts, and is likely to have an impact on related arbitrations governed by Chinese law.
A recent message in the WeChat public account of the Supreme People’s Court (SPC)’s Administrative Division was devoted to promoting its new book, Supreme People’s Court Administrative Litigation User’s Guide (Administrative Litigation User’s Guide (2nd edition), 最高人民法院行政诉讼实用手册), shown in the photo above. Had the SPC’s #4 Civil Division had a WeChat public account last year when they published 涉外涉港澳台民商事审判业务手册( Foreign-Related, Hong Kong, Macao and Taiwan Related Commercial Trial Work Guide — “Foreign-Related Judicial Handbook”), I am sure that I would have received a similar message. I had previously thought that judicial handbooks were a historical artifact of the days before electronic databases. In my 1993 article, I discussed the phenomenon of judicial handbooks:
Supreme People's Court Monitor 
You must be logged in to post a comment.