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CHINA: An Introduction to Dispute Resolution: Arbitration (PRC Firms)

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2024 marked the 30th anniversary of the PRC Arbitration Law, a significant milestone characterised by innovative revisions proposed by legislators to update the existing law, as well as breakthroughs in modernising and internationalising China’s arbitration framework. This article explores two major aspects:

  • the pro-arbitration judicial environment; and
  • the evolving regulatory framework.

Pro-Arbitration Judicial Environment

The SPC report on arbitration

On 9 September 2024, the Supreme People’s Court released the 2023 Annual Report on Judicial Review of Commercial Arbitration (the “SPC Report”). The key statistics are as follows.

Judicial review of arbitration

2023 marked another period in which Chinese courts demonstrated a pro-arbitration stance. During 2023, Chinese courts accepted over 16,000 arbitration-related cases. Of these, 25% were applications to confirm the validity of arbitration agreements, 64% were applications to set aside arbitral awards and 11% were related to the non-enforcement of arbitral awards. Notably, only 5.11% of the applications to set aside arbitral awards were granted. Additionally, Chinese courts made rulings for 69 applications to enforce foreign arbitral awards, with only three cases being rejected. These rejections were due to the expiration of the application time limit, the inability to identify the respondent or ongoing applications to set aside awards at the award's seat. In their judgments, Chinese courts consistently emphasised the high threshold for challenging arbitral awards, particularly foreign ones. This practice reflects a clear trend of judicial support for arbitration and adherence to China’s commitments under the New York Convention.

Judicial support of arbitration

In 2023, Chinese courts concluded over 5,100 cases where parties applied for preservation of assets, evidence or conduct before or during arbitration. Notably, more than 4,900 or 95.73% of these cases were successfully upheld by the courts. Additionally, some courts established online platforms to offer one-stop shop services for arbitration-related preservation. These platforms allow arbitration institutions to transmit party applications directly to the courts through an online system connected to the National Online Inquiry and Control System, thereby enhancing the efficiency of the court preservation process.

Enforcement of interim measures made by arbitral tribunal

While the current Arbitration Law does not address the arbitral tribunal's authority to issue interim measures, Chinese courts have actively responded to parties’ needs in this area. On 28 November 2024, the Beijing No 4 Intermediate People's Court released ten model cases to support the establishment of an international commercial arbitration centre in China. Case No 9 illustrates the Court's mandatory enforcement of an interim measure issued by an arbitral tribunal of the Beijing Arbitration Commission (BAC), marking the first court action of this kind. According to available information, the BAC administered a case related to technology development and service. One party applied for interim asset preservation to ensure the final enforcement of the award and the tribunal issued an interim measure order in favour of the applicant.

Ad hoc arbitration in China

In 2024, there was significant progress in the development of ad hoc arbitration in China. The current PRC Arbitration Law does not explicitly address ad hoc arbitration and it was not permitted in mainland China until 2016. That year, the Supreme Court issued the Opinions on the Provision of Judicial Safeguards for the Construction of Pilot Free Trade Zones, allowing companies registered within these zones to conduct ad hoc arbitration. Several local governments issued regulations to enhance the economic, social and legal appeal of their regions through ad hoc arbitration in response. For example, in June 2024, the Shanghai Municipal Bureau of Justice implemented the Measures for Promoting Ad Hoc Arbitration of Foreign-Related Commercial and Maritime Disputes (the “Shanghai Measures”), following the Regulations on Promoting the Construction of an International Commercial Arbitration Centre in Shanghai issued by the Standing Committee of the People’s Congress of Shanghai. The Shanghai Measures provide detailed guidance for conducting ad hoc arbitration in Shanghai.

In or around August 2024, China's first foreign-related maritime ad hoc arbitration case was administered and concluded. The case involved a crew management service contract for international routes. Seeking a swift resolution to their dispute, the parties agreed to ad hoc arbitration in Shanghai, following the guidelines set out in the Shanghai Measures.

The Evolving Regulatory Framework

 

The current Arbitration Law, enacted in 1994, has been in effect for 30 years. In July 2021, responding to the significant growth of arbitration activities in China over the last two and a half decades, the Ministry of Justice published the first Draft Amendment (the “2021 Draft”). The 2021 Draft proposed extensive revisions and sparked considerable debate. Three years later, on 8 November 2024, the Standing Committee of the 14th National People's Congress released the second Draft Amendment (the “2024 Draft”), which adopted a more conservative approach than the 2021 Draft. The 2024 Draft was published to solicit public feedback.

Key changes in the 2024 Draft

According to the Ministry of Justice's explanatory notes, the 2024 Draft aims to enhance the credibility of arbitration, align with prevailing international standards and practices and ultimately foster economic growth and deepen opening up. To achieve these goals, the 2024 Draft proposes the following key changes.

The 2024 Draft introduces the concept of the “seat of arbitration” in place of the traditional notion of the “place of arbitration institution”, demonstrating a positive move towards aligning with international practices. Under the current Arbitration Law, the absence of the “seat” concept has led to ambiguities in judicial practices concerning issues such as the nationality of awards and the legality of ad hoc arbitration. Article 78 of the 2024 Draft specifies that the law of the seat governs arbitral proceedings, providing judicial support and oversight. This proposed amendment reflects China’s more open attitude towards cross-border arbitration, reducing legal uncertainty for parties and boosting confidence among users of arbitration in China.

Building on this conceptual change, the 2024 Draft incorporates several common international practices. Article 28 empowers arbitral tribunals to rule on their own jurisdiction for example. Article 42 mandates that arbitrators disclose any information that may lead parties to reasonably question their independence and impartiality. Article 79 permits parties to opt for ad hoc arbitration in maritime disputes or disputes between companies in free trade zones that involve foreign-related elements. Additionally, Article 83 allows foreign arbitration institutions to be established within free trade zones and manage arbitration cases with foreign-related elements.

Issues to be further addressed

These legislative efforts are positive and have been widely recognised. However, certain provisions in the 2024 Draft raise concerns, leaving several issues that need further consideration before the final law is enacted.

For example, some Articles in the 2024 Draft do not adequately align with the fundamental principles of arbitration, particularly the parties' autonomy in resolving civil disputes without resorting to judicial governance. Article 2 includes a political declaration, which could raise concerns among international users. Article 23 subjects arbitration institutions and their staff to administrative supervision. Furthermore, Article 87 stipulates that the fee standards for arbitration should be determined in line with a fee scheme approved by government authorities. To enact a modern Arbitration Law that adapts to the evolving landscape of commerce and international transactions, it is crucial for legislators to reconsider these Articles. These revisions are essential to ensure that the amended Arbitration Law effectively supports China's ambition to become a leading international arbitration hub.

Conclusion

In conclusion, while a new Arbitration Law was not successfully enacted in 2024, arbitration activities in China have flourished. Significant milestones have been achieved, new practices established and positive trends toward international common practices have emerged. The Chinese courts have become increasingly supportive of arbitration and the government is keen to develop this field further to create a more business-friendly environment for entrepreneurs. These developments underscore China’s commitment and ambition to establish an international arbitration environment and offer high-quality arbitration services for both domestic and international users.

2024年恰逢中国《仲裁法》颁布30周年。在这具有里程碑意义的一年里,立法者对现行仲裁法提出了创造性修改建议,中国仲裁活动在现代化和国际化方面不断突破。本文就此主要讨论以下两方面内容:(i) 友好的仲裁司法环境;和 (ii) 《仲裁法》修订。

友好的仲裁司法环境

最高院仲裁报告

2024年9月9日,最高人民法院发布了《2023年商事仲裁司法审查年度报告》(“《最高院报告》”)。重要数据如下:

仲裁司法审查

2023年,中国司法实践继续展现对仲裁的友好态度。在这一年里,全国法院共受理超16,000件仲裁司法审查案件。其中,25%为申请确认仲裁协议效力案件,64%为申请撤销仲裁裁决案件,11%为申请不予执行仲裁裁决案件。值得注意的是,法院仅在5.11%的案件中支持当事人申请撤销裁决的请求。此外,法院共裁定69件承认和执行外国仲裁裁决案件,除3例因超过申请时效、被申请人身份不确定、已在作出裁决国家法院申请撤销裁决等原因未获支持外,其余全部予以承认和执行。法院在相关判决说理部分多次强调仲裁司法审查的高标准要求,尤其是审查外国仲裁裁决。这体现了法院支持仲裁和践行《纽约公约》下承诺义务的立场。

司法支持仲裁

2023年,中国法院共审结仲裁保全(财产、证据或行为)案件超5,100件。值得关注的是,法院在95.73%(超过4900件)的案件中支持了保全请求。目前,部分法院实现全流程网上办理仲裁财产保全案件,仲裁机构可通过在线方式向法院转递当事人的仲裁保全申请,法院通过网络执行查控系统,全面提升保全效率。

法院执行仲裁庭作出的临时措施

虽然现行《仲裁法》并未明确仲裁庭有权作出临时措施,但实践中法院已根据当事人需求对该问题作出回应。2024年11月28日,北京市第四中级人民法院发布支持和保障国际商事仲裁中心建设十大典型案例。在第9号案例中,北京市第四中级人民法院强制执行了北京仲裁委员会(“北仲”)仲裁庭作出的临时措施,为史上首例。根据相关信息,该案由北仲管理,案件涉及技术开发和服务纠纷。一方当事人申请临时财产保全措施以保障最终裁决执行,仲裁庭支持申请人请求,裁定准予临时措施。

中国的临时仲裁

2024年,中国临时仲裁继续实质性发展。现行《仲裁法》未明确规定临时仲裁,临时仲裁活动在2016年前尚不被准许在大陆地区进行。2016年,最高人民法院发布《关于为自由贸易试验区建设提供司法保障的若干意见》,允许自由贸易试验区内注册的企业开展临时仲裁。在此基础上,部分地方政府出台临时仲裁相关规则,以增强地区经济、社会和法律营商环境吸引力。例如,上海市司法局根据上海市人大常委会制定的《上海市推进国际商事仲裁中心建设条例》制定了《上海市涉外商事海事临时仲裁推进办法》(“《上海办法》”)并于2024年6月发布。《上海办法》为上海地区开展临时仲裁提供了详细指引。

2024年8月前后,全国首例涉外海事临时仲裁案件审结。该案涉及国际航线船员管理服务合同。为快速解决争议,双方同意根据《上海办法》在上海进行临时仲裁。

 

现行《仲裁法》的修订

现行《仲裁法》于1994年颁布,施行至今已三十年。2021年7月,为适应中国仲裁事业二十五年来的蓬勃发展,以现代仲裁法引领仲裁未来发展,司法部发布《仲裁法》(征求意见稿)(“《2021年草案》”)。该草案提出大量实质修订意见,并引发公众热烈讨论。三年后,第十四届全国人民代表大会常务委员会于2024年11月8日发布《仲裁法》(修订草案)(“《2024年草案》”)。相较于前者,《2024年草案》更为保守。目前,《2024年草案》处于征求公众意见阶段。

《2024年草案》关键修订内容

根据司法部的草案解释,《2024年草案》旨在“切实提升我国仲裁公信力和国际竞争力,更好服务高质量发展和高水平开放。”为实现上述目标,《2024年草案》提出以下关键修订内容。

《2024年草案》引入“仲裁地”的概念,以取代传统的“仲裁机构所在地”概念,展现了与国际仲裁惯例接轨的积极姿态。因现行《仲裁法》缺少“仲裁地”概念,裁决籍属的认定、临时仲裁的合法性等问题在司法层面没有确定答案。此次,《2024年草案》第78条明确规定,仲裁地法是仲裁程序相关问题的适用法,应据此开展相应司法支持和审查。该修订展现了中国对跨境仲裁愈加开放的态度,降低当事人的仲裁法律风险,增强用户对中国仲裁的信心。

基于仲裁地概念,《2024年草案》引入了许多国际通行做法。例如,第28条授权仲裁庭自裁管辖权。第42条要求仲裁员在当事人可能对其独立性和公正性产生合理怀疑时披露相关信息。第79条允许当事人就涉外海事纠纷或自由贸易区内企业间涉外纠纷选择临时仲裁。第83条允许外国仲裁机构在自由贸易区内设立分支机构并管理涉外仲裁案件。

仍待解决的问题

上述修法意图十分积极,且得到了广泛肯定。但《2024年草案》中部分条款仍引起关注,并且在最终立法出台前应予进一步考虑。

例如,《2024年草案》的部分条款未能回应仲裁根本原则,即当事人不希望寻求司法救济,而是以私法意思自治方式解决争议。目前草案第2条纳入了政治性宣言,可能会引起境外仲裁用户的疑虑。又如,第23条允许行政机关对仲裁活动施加行政监督和干预。再如,第87条规定仲裁收费标准应按照政府主管部门批准的标准制定。我们认为,修订后的《仲裁法》应当适应现代商业和国际交易的发展和变化,为此,立法者应进一步斟酌上述条款,以充分发挥《仲裁法》作用,促进中国在国际仲裁中心的建设道路上继续前进。

总结

综上所述,虽然新《仲裁法》未能于2024年颁布,但中国的仲裁活动展现出欣欣向荣的发展趋势,并已取得重要阶段成果,新的实践做法不断涌现,并进一步与国际接轨。中国法院越来越支持仲裁,政府也大力发展仲裁,力求为商业主体创造更加友好的营商环境。这些发展均彰显了中国打造国际化仲裁环境、为国内外用户提供高质量仲裁服务的雄心和决心。