Assurance and Advisory Business Services Recognition and Enforcement of Overseas Arbitral Award in China John Liu, Partner, Allbright Law Offices

Foreign-related disputes Commercial disputes tried in Mainland China in 2015 type forum Domestic disputes Foreign-related disputes Court proceeding 3,340,921 6,079 Arbitration 134,839 2,085 4% 25%

Law applicable to the arbitration agreement: Parties’ choice Place of arbitration, or place of arbitration institution Chinese laws

No ad hoc arbitration in Mainland China Overseas ad hoc arbitral award can be recognized and enforced in Mainland China

New York Convention became effective on Mainland China as from April 22, 1987 with reservations on: Reciprocity Commercial matters

Intermediate court where: Recognition and enforcement of arbitral awards rendered by overseas arbitration institutions (ad hoc arbitration) Intermediate court where: the respondent resides, or the respondent has assets. Time limit: two years

Decision on the recognition and enforcement of arbitral awards is final and cannot be appealed: Before rejection of overseas awards, the court shall seek approval from the Supreme Court. Possible to apply to the Supreme Court for review of the decision in certain circumstances.

Circumstances not to recognize and enforce an overseas arbitral award: No arbitration clause in the contract or written arbitration agreement. Respondent did not receive notice on appointment of arbitrator or arbitration proceeding, or did not state opinions due to reasons not attributable to him. Email? Telephone? Registered office? Actual office?

Circumstances not to recognize and enforce an overseas arbitral award: Composition of arbitral tribunal or arbitration proceeding is inconsistent with the arbitration rule. Arbitrated matters fall outside of the arbitration agreement or the tribunal has no power to arbitrate. Against social public interests.

b In 2015, after approval by the Supreme Court, four applications to recognize and enforce overseas arbitral awards are rejected: 3 rejections because of absence of valid arbitration agreement ICA, contract reached by fax, signed but not stamped 1 rejection because of arbitration beyond the scope of arbitration agreement

In June 2016, an ICC award was rejected for violation of public interests: On July 4, 2011, the Chinese party filed a lawsuit to a Chinese court to invalidate the arbitration agreement. On November 4, 2011, the foreign party filed an arbitration claim based on the arbitration agreement. On December 11, 2012, the Chinese court ruled the arbitration agreement invalid. On July 18, 2014, the ICC rendered the arbitral award.

Domestic disputes cannot be arbitrated overseas. Domestic? Disputes between two Wholly Foreign Owned Enterprises both registered in Shanghai Pilot Free Trade Zone Sales of good through Shanghai Pilot Free Trade Zone

John Liu John.liu@allbrightlaw.com 上海 北京 天津 香港 成都 重庆 南京 厦门 深圳 杭州 苏州 青岛 济南 太原 合肥 Shanghai Beijing Tianjin Hong Kong Chengdu Chongqing Nanjing Xiamen Shenzhen Hangzhou Suzhou Qingdao Jinan Taiyuan Hefei