Weixia Gu on China’s Approach to the Recognition and Enforcement of Foreign Civil and Commercial Judgments (Journal of Comp Law)

“China’s Approach to the Recognition and Enforcement of Foreign Civil and Commercial Judgments and International Litigation Capacity Building” 

Weixia Gu
The Journal of Comparative Law
2020, Volume 15, Issue 2, pp. 264-291

Introduction: The unparalleled economic growth of the People’s Republic of China (hereafter China, or the PRC) has resulted in a paradigm shift in its legal regime. Once a comparatively closed market to the world, China now faces an unprecedented surge of international business and movement of global capital into its domestic market in light of its immense economic growth in the past forty years. As a result of this growth, the internationalisation of business in China requires the domestic courts to accommodate private international law practices such as allowing foreign judgments to be recognised and enforced in the domestic courts: a clear indicator of globalization1 and the development of China’s economy.

      An important step China has taken in the past few years is to improve efficiency in recognising and enforcing foreign judgments. Specifically, the salient shift to a more liberal application of the reciprocity principle, the signing of the 2005 Hague Choice of Court Convention (2005 Hague Convention) and the growing number of bilateral treaties on judicial assistance are clear indicators of China’s recent willingness to improve commercial certainty for the parties involved, to promote fairness for both domestic and foreign litigants, and to ensure the global movement of judgments, resulting in increased investor confidence and further economic growth in China.

      This article analyses current theory and practice with respect to the recognition and enforcement of foreign civil and commercial judgments in China. There are three regimes that will be analysed: (1) the existing Sino-bilateral judicial assistance treaties on civil and commercial matters; (2) in the absence of a bilateral treaty, the application by the Chinese courts of the principle of ‘reciprocity’ while taking account of procedural and substantive concerns specific to China; and (3) the potential impact of the 2005 Hague Convention signed by the Chinese government in September 2017.

      This article argues that while China’s recent reforms in the judicial recognition and enforcement of foreign civil and commercial judgments (hereafter, JRE) are encouraging, due to the growing demand of international litigation in context of the Belt and Road Initiative (BRI), the Chinese JRE regime should be comprehensively reformed to build legal capacity. For that purpose, the author has put forward three proposals: (1) the ratification of the 2005 Hague Convention; (2) the Model Law on JRE to be adopted by China’s Supreme People’s Court; and (3) potential reference to the 2019 Hague Judgments Convention. Finally, this article examines the extent to which such proposals can actually help China promote the legitimacy and competence of the Chinese international litigation system in light of her ambitious BRI development.