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.

Weixia Gu on Enforcement of Arbitral Awards in Asia under the Belt and Road Initiative (CUP book chapter)

"Enforcement of Arbitral Awards in Asia under the Belt and Road Initiative: Implications for International Governance and the Chinese Rule of Law"

Weixia Gu

in Yun Zhao (ed), International Governance and the Rule of Law in China under the Belt and Road Initiative (Cambridge University Press, September 2018), pp. 277-294

Introduction: The accomplishments of a broadly homogenised global arbitration system have been made possible by international embracement of three UN-initiated arbitration devices: the Convention on the Recognition and Enforcement of Foreign Aribitral Awards (the New York Convention here-after), UNICITRAL Model Law on International Commercial Arbitration (Model Law hereafter) and UNCITRAL Arbitration Rules (UNCITRAL Rules hereafter). However, a truly harmonised system of international commercial arbitration has thus been foiled by the 'public policy' exception in the enforcement of arbitral awards under the New York Convention, Article V2 (b) which stipulates that '[r]ecognition and enforcement of an arbitral award may also be refused if the competent authority in the country where recognition and enforcement is sought finds that ... (b) [t]he recognition or enforcement of the award would be contrary to the public policy of that country. Indeed, it was Burrough J of the English court of the Exchequer who famously proclaimed in 1824 that public policy 'is a very unruly horse, and once you get astride it you never know where it will carry you. The 'unruly horse' metaphor aptly captures the indeterminacy of the public policy exception within international commercial arbitration, a substantial and recurring obstacle to both the finality and enforceability of arbitral agreements and awards. The existence of differing conceptions of public policy amongst legal systems, traditions and jurisdictions generates substantial uncertainty as to the conditions of international arbitral award enforcement in both theory and practice. True harmonisation of the nebulous public policy exception is thus necessary to fashion a cogent, coherent arbitral enforcement system that is applicable across the globe.

     Within Asia, the aim of China's proposed Belt and Road Initiative (BRI) is to bolster regional connectivity, promote cross-border investment and strengthen economic coordination across the Eurasian nations located along the historic Silk Road. In light of the large volume of cross-border contractual disputes expected to arise as a result of the BRI, the importance of arbitration as the preferred means of commercial dispute resolution is expected to grow, particularly given its ability to mitigate conflicts between different legal systems. This chapter contends that the BRI provides an ideal context for contemplating the possibility of the regional or 'geo-legal' harmonisation of the public policy concept in the cross-border enforcement of arbitral awards within Asia. Whilst the abundance of different legal cultures in Asia presents formidable challenges to harmonisation, bringing consistency to the public policy exception is likely to yield substantive benefits in the arena of commercial certainty and, as a natural corollary, stimuli for boosting investment amongst the Belt and Road nations. Such developments will pave the way towards the ultimate goal of 'true harmonisation' of the international commercial arbitration system...

Felix Chan on Enforcing Inconsistent Foreign Judgments (J Int'l Maritime L)

"Inconsistent Foreign Judgments on Exclusivity of Jurisdiction: Comity and Judicial Deference"
Felix Chan
The Journal of International Maritime Law 
2017, published, Vol.32, Issue 2, pp 91-95
Abstract: A domestic common law court is faced with an application to enforce a judgment issued by foreign court X. However, the judgment issued by court X is apparently inconsistent with another judgment previously rendered by foreign court Y. In addition, the action of court X in issuing the judgment may involve a breach of comity towards court Y. What should the domestic enforcing court do? What factors should the enforcing court consider when deciding whether the enforcement of the judgment rendered by court X is contrary to public policy on grounds of comity? In CompaniaSud Americana De Vapores SA v Hin-Pro International Logistics Ltd [2016] HKCFA 79, Lord Phillips of Worth Matravers sitting in the Hong Kong Court of Final Appeal articulated important principles and guidelines in these areas of private international law and the doctrine of comity. He identified the key factors the enforcing court should consider when evaluating whether the enforcement of a judgment rendered by foreign court X is contrary to public policy on grounds of comity, and whether the judgment of court X is in conflict with another judgment previously issued by foreign court Y on the same issue. Several aspects of Lord Phillips’ reasoning warrant further discussion and elucidation.