Can I initiate arbitration proceedings against Chinese companies in my country and then have the awards enforced in China? You probably don’t want to go to faraway China to sue a Chinese company, and you don’t want to agree in the contract to submit the dispute to an arbitration institution that you don’t know about.
Recognizing and Enforcing Foreign Arbitral Awards in China
Building the arbitration credibility and the opening-up of arbitration sector in Shanghai and Beijing FTZs are highlights of China's latest arbitration policies.
China's arbitration policies have been increasing since 2015, and the arbitration is gradually gaining widespread attention. We need to understand why this is happening.
The survey (2019-2020) shows that court fees in most courts are charged per case basis (either 400 CNY or 500 CNY), rather than in proportion to the subject matter amount, which is undoubtedly good news for those wishing to enforce foreign arbitral awards.
To enforce a foreign arbitral award in China, the average length of proceedings is 596 days, the court costs are no more than 1.35% of the amount in controversy or 500 CNY, and the attorney's fees are, on average, 7.6% of the amount in controversy.
In 2019, the Chinese courts have heard a total of 30 cases concerning the recognition and enforcement of foreign arbitral awards.
When it comes to the stage of recognition and enforcement, limitation period is a decisive factor but can be easily ignored by the winning parties.
How would Chinese courts view arbitral awards where foreign tribunals reject a force majeure claim connected to the coronavirus (COVID-19) pandemic?
On the grounds of public policy, the Tianjin Maritime Court refused to enforce an arbitral award made in London on 1st July 2018.
On what basis would Chinese courts examine the arbitral awards made by foreign arbitration institutions in mainland China, the New York Convention or Chinese domestic law? The answer is the latter.