CHINA: An Introduction to Dispute Resolution (PRC Firms)

New Developments in Chinese Arbitration

On 4 November 2024, the Draft Amendment to the Arbitration Law of the People's Republic of China (“Draft Amendment to the Arbitration Law”) was submitted to the 12th Session of the 14th National People's Congress Standing Committee for its first review. On 8 November 2024, the reviewed text was released, which once again aroused heated discussions in legal society. While it remains uncertain which suggestions will be adopted into legislation, arbitration practice in China has evolved ahead of formal legal changes. The new arbitration rules issued by the China International Economic and Trade Arbitration Commission (CIETAC) in September 2023 and implemented in January 2024 (“2024 CIETAC Rules”) demonstrate how Chinese arbitration is actively aligning with international trends.

Early Dismissal 

The early dismissal mechanism first appeared in the Rules of Procedure for Arbitration Proceedings of the International Centre for Settlement of Investment Disputes (“ICSID Arbitration Rules”). The standard under Rule 41 of the ICSID Arbitration Rules is manifestly without legal merit. Under ICSID jurisprudence, it is a high bar requiring a respondent “to establish its objection clearly and obviously, with relative ease and despatch”. The objection may relate to the substance of the claim, the jurisdiction of the ICSID, or the competence of a tribunal. It relates to “a legal impediment to a claim”, not a factual one. Therefore, a tribunal should generally accept the facts as pleaded by a claimant in determining an early dismissal objection, unless it considers that the factual allegations are “incredible, frivolous, vexatious or inaccurate or made in bad faith.”

Following UNCITRAL’s adoption ofa guidance text on early dismissal and preliminary determination in July 2023, the 2024 CIETAC Rules have introduced early dismissal provisions for the first time in China. Under Article 50 of the 2024 CIETAC Rules, a party may request for early dismissal of a claim or counterclaim, in whole or in part, if it is manifestly without legal merit or manifestly outside the jurisdiction of an arbitral tribunal. An arbitral tribunal retains discretion whether to hear such an application. The rules also clarify that the application for early dismissal will not impede the continuation of the arbitration proceedings. The practical interpretation of what constitutes “manifestly without legal merit” and the specific standards a CIETAC tribunal will apply when determining early dismissal objections remains to be established through future cases.

Interim Award

Interim awards were rarely used in Chinese arbitration in early years due to the absence of clear guidelines. The Beijing International Arbitration Center (BAC) has included provisions for interim awards in its rules since 1995. However, there was no strict distinction between partial awards and interim awards. The distinction became clearer through practice - partial awards which are final address one or several reliefs requested by a claimant in its pleadings, while interim awards which are not final address procedural issues or preliminary substantive issues (not the reliefs themselves). In BAC’s practice, interim awards were used for issues such as validity of an arbitration agreement, preliminary issues, parties’ legal standing and scope of an arbitration case. Now under Article 49 of the 2024 CIETAC Rules, an arbitral tribunal may issue interim awards on “any issue” before rendering a final award, either on its own initiative or upon approving a party’s request. Such broad language, encompassing “any issues”, grants tribunals substantial discretion in implementing interim awards. Given the inclusion of interim measures and emergency relief in the 2024 CIETAC Rules, it could be predicted that interim awards will be used to grant interim measures and emergency relief.  

Interim Measures

Under the current Draft Amendment to the Arbitration Law, the authority to grant interim measures remain exclusively with Chinese courts, not arbitral tribunals. Therefore, where the lex arbitri is Chinese law, strictly speaking, arbitral tribunals lack the power to grant interim measures and emergency relief. This does not apply, however, where the lex arbitri is foreign law. Article 23(2) of the 2024 CIETAC Rules allows an arbitral tribunal to grant interim measures and emergency relief in accordance with the applicable law or parties’ agreement.

Another meaningful addition to the 2024 CIETAC Rules appears in Article 23 (1), which explicitly authorises CIETAC to transfer a claimant’s preservation application to a Chinese court before serving a notice of arbitration on a respondent. Timing of preservation is usually critical, as serving a notice of arbitration before securing preservation orders may allow a respondent sufficient time to transfer assets. While Chinese courts have traditionally shown reluctance in granting pre-arbitration preservation applications, this new CIETAC rule addresses the challenge and may increase both success rate and practical utility of interim measures. The implementation of asset preservation measures has been further simplified for foreign parties following China’s adoption of the Convention Abolishing the Requirement of Legalization for Foreign Public Documents effective 7 November 2023. This development eliminates the previously required consular authentication procedures, streamlining the process for foreign companies and individuals seeking interim measures in arbitration.

Third-Party Funding

While third-party funding is well-established and prevalent in international arbitration, it remains relatively novel in China. Recent Chinese court judgments have demonstrated contrasting positions on third-party funding in litigation versus arbitration. A Shanghai court judgment in May 2022 invalidated a third-party funding agreement in litigation, citing violation of public order and good morals (see (2021) Hu 02 Ming Zhong No. 10224). Conversely, a Beijing court ruling in November 2022 affirmed the validity of third-party funding in arbitration (see (2022) Jing 04 Ming Te No. 368, 369). Drawing from CIETAC’s experience with third-party funding cases, Article 48 of the 2024 CIETAC Rules introduces explicit disclosure requirements for parties regarding the existence and arrangements of third-party funding. This information enables a tribunal to consider funding arrangements when making its final awards. This new provision not only recognises the practice of third-party funding in arbitration, but also promotes procedural transparency and helps mitigate potential conflicts of interest and ethical risks.

In addition to the new developments discussed above, the 2024 CIETAC Rules introduce other notable procedural refinements, including modifications to the procedure for appointing a presiding arbitrator, clarification that both Chinese and foreign arbitrators may opt for hourly-based fee arrangements, etc. These updates demonstrate how Chinese arbitration continues to integrate international practice while maintaining its distinctive characteristics. Such progressive amendments enhance the efficiency and accessibility of CIETAC’s dispute resolution framework for both domestic and international users.

中国仲裁的新发展

2024年11月4日，《中华人民共和国仲裁法（修订草案）》（“《仲裁法修订草案》”）提请十四届全国人大常委会第十二次会议首次审议。2024年11月8日，经审议的《仲裁法修订草案》文本发布，再次在业界引起了热议。哪些建议会在立法的层面最终落地虽未可知，但中国仲裁的实践已经走到了立法的前面。以中国国际经济贸易仲裁委员会（“贸仲”）在2023年9月发布、2024年1月施行的新仲裁规则（“《2024贸仲规则》”）为例，中国仲裁在许多制度上都做出了与国际潮流接轨的积极尝试。

早期驳回

早期驳回制度最早出现在国际投资争端解决中心（ICSID）的仲裁规则中。《ICSID仲裁规则》第41条下早期驳回的标准是明显缺乏法律依据。在ICSID的法律体系下，这一标准要求被申请人能够“清楚、明显、相对轻松、迅速地提出异议”。异议可能涉及仲裁请求的实质、ICSID 的管辖权或仲裁庭的权限。它涉及“仲裁请求的法律障碍”，而不是事实障碍，因此仲裁庭在审理早期驳回异议时，通常应接受申请人所陈述的事实，除非它认为事实指控“不可信、无意义、无理取闹或不准确或系恶意提出”。

随着贸法会于2023年7月正式通过“早期驳回和初步决定”指导文案后，《2024 贸仲规则》首次在中国引入了早期驳回制度。第50条下，当事人可以以仲裁请求或反请求明显缺乏法律依据或明显超出仲裁庭的管辖范围为由申请早期驳回全部或部分仲裁请求或反请求。仲裁庭可以对早期驳回程序申请作出是否受理决定。规则进一步明确当事人提起早期驳回程序申请不影响仲裁庭继续进行仲裁程序。实践中，什么样的仲裁请求或反请求会被贸仲仲裁庭认定为“明显缺乏法律依据”、仲裁庭会依据什么样的具体标准来审理早期驳回异议，有待进一步实践积累和观察。

中间裁决

过去在国内仲裁实践中，中间裁决很少被使用，并未形成确定的适用规则。北京国际仲裁中心（“北仲”）自1995年的仲裁规则就规定了中间裁决，但一开始并没有对部分裁决和中间裁决进行严格区分。两者的区别在北仲的实践中逐渐明朗起来：部分裁决是针对当事人仲裁申请中提出的已经审理清楚的某项或某几项仲裁请求而作出的，是终局性的裁决；而中间裁决则是针对案件争议中的程序事项或者有关实体方面的先决事项作出的裁决，中间裁决并非针对仲裁请求作出，不是对仲裁请求的终局处理。实践中，北仲通常将中间裁决适用于仲裁协议效力、先决事项、主体资格、裁决范围等事项。²《2024 贸仲规则》第49条明确，仲裁庭认为必要或当事人提出请求并经仲裁庭同意的，仲裁庭可以在作出最终裁决之前，就案件的“任何问题”作出中间裁决。可见，在贸仲规则下，仲裁庭对做出中间裁决具有非常大的自由裁量权。鉴于《2024贸仲规则》包含了关于临时措施和紧急救济的新规定，中间裁决应用于临时措施和紧急措施，显然是应有之义。

临时措施

根据目前的《仲裁法修订草案》，授予临时禁令的权力仍然在于法院，而非仲裁庭。因此，如果仲裁程序的准据法是中国法，严格来说，仲裁庭没有权力授予临时措施和紧急救济。但如果仲裁程序的准据法是外国法，则没有这样的限制。《2024贸仲规则》第二十三条第（二）款允许仲裁庭根据所适用的法律或当事人的约定，授予临时措施和紧急救济。

《2024贸仲规则》的另一个有意义的修改是在第二十三条第（一）款第二段明确规定仲裁委员会可依据当事人的请求，将其提交的保全措施申请在仲裁通知发出前先行转交法院。获得保全的时间点对于申请人来说往往至关重要。如果保全申请在仲裁通知送达后才向法院转交，那么被申请人往往有足够时间转移其资产。实践中，中国法院普遍不愿意接受仲裁前保全申请。贸仲的新规则将可能弥补仲裁前保全在实践中遇到的困境，从而更好地提高保全等临时措施申请的成功率，大大提高仲裁中财产保全等临时措施程序的易用性。与此相关的是，随着2023年11月7日《取消外国公文书认证要求的公约》在中国生效实施，此后外国公司和个人在提起仲裁时申请财产保全等临时措施将更加便捷，而无需经历繁琐的使领馆认证程序。

第三方资助

尽管第三方资助在国际仲裁中已十分成熟和多见，但在中国仍是新鲜事物。从近期中国法院的判决来看，法院对于诉讼和仲裁中的第三方资助似乎持有不同的态度。上海市法院在2022年5月的一份判决中认为诉讼中的第三方资助协议违反了公序良俗因此无效（（2021）沪02民终10224号），而北京法院在2022年11月的裁定中则认可了仲裁中第三方资助的效力（（2022）京04民特368、369号）。《2024贸仲规则》第四十八条结合贸仲近期处理的有关第三方资助案件，就第三方资助作出了明确规定，并要求当事人披露第三方资助的事实和相关安排，允许仲裁庭在作出裁决时考虑第三方资助的相关事实。这一新规定认可了仲裁中第三方资助的实践，并且要求披露第三方资助的存在和安排，增加第三方资助的透明性，以避免潜在的利益冲突和道德风险。

除了前述新的发展之外，此次《2024贸仲规则》还修改了首席仲裁员的指定程序、明确了中外籍仲裁员均可选择按小时收费等。我们欣喜地看到，中国仲裁在保持自身特点的同时，继续融合与借鉴国际仲裁的最新实践和发展，必将为境内外的用户提供更好的争议解决体验。