China Choice of Law in 2003

There’s an interesting article in the most recent edition of the Chinese Journal of International Law (7 Chinese J. Int’l L. 227 if you want to bring it up in WestLaw or LexisNexis) covering several subjects on Chinese judicial practice in 2003. The subjects covered include a statistical analysis of 50 civil and commercial cases from 2003, renvoi, inter-temporal conflict of laws, jurisdictional competition between judicial settlement of disputes and arbitration, and the recognition and enforcement of foreign judgments and arbitral awards. The article is by Huang Jin, Director of Wuhan University Institute of International Law, and Du Huanfang, and is entitled Chinese Judicial Practice in Private International Law: 2003.

I would like to focus on the case survey in the first part of the paper and provide an alternative statistical analysis of the choice of law data collected. The data consists of 50 cases in 2003, all of which are available in the Chinese Gazette of Supreme People’s Court (2003-2004) or the SPC’s website. The cases come from several different courts across China. The authors included the named parties and cause of action, the countries or regions involved (including 8 cases involving only Chinese parties), the law of the country that the court chose to apply, and the method by which the court chose which country’s law to apply to the dispute.

To analyze the choice of law application differently than the authors, I decided to eliminate the 8 cases involving only Chinese parties and the 1 case between foreign parties, leaving 41 cases in the data set because the choice of law analysis is more interesting and useful when there is an actual conflict of laws. In 8 of the 41 cases between a foreign party and a Chinese party the judge gave no reason or method for choosing what the applicable law the court would apply in a conflict of laws, and in each of those 8 cases the judge applied the law of the People’s Republic of China. The authors do not discuss this point at all, but, assuming that these cases are representative of the Chinese judicial system, this means that in ~19.5% of all civil and commercial cases tried in China the judges decide the critical conflict of law issue without even saying why or how they are arriving at the conclusion. And, even more suspect, they each arrived at the conclusion to apply Chinese law. I investigated the courts that these decisions came from 7 of the 8 are from different courts meaning that there is no one court that is, seemingly, arbitrarily choosing to apply Chinese law to a conflict of law problem.

Hopefully there has been improvement in this area since 2003. The relevant law in litigation can be as important as the facts of the case themselves, because if the relevant law does not find something illegal then there is nothing to be litigated. 19.5% is an unacceptably high level of cases for judges to not be explaining why they have chosen a set of laws that govern the dispute when the relevant law is so important to the outcome of the suit. Under U.S. law it is mandatory to include in your claim why the court has jurisdiction and it is hard to imagine a claim being sufficient without saying what the applicable nation or state’s law is.

Fortunately, in the world of Chinese jurisprudence 2003 is a long LONG time ago.