Advisory Board

  • Cai Hongbin
  • Peking University Guanghua School of Management
  • Peter Clarke
  • Barry Diller
  • IAC/InterActiveCorp
  • Fu Chengyu
  • China National Petrochemical Corporation (Sinopec Group)
  • Richard J. Gnodde
  • Goldman Sachs International
  • Lodewijk Hijmans van den Bergh
  • De Brauw Blackstone Westbroek N.V.
  • Jiang Jianqing
  • Industrial and Commercial Bank of China, Ltd. (ICBC)
  • Handel Lee
  • King & Wood Mallesons
  • Richard Li
  • PCCW Limited
  • Pacific Century Group
  • Liew Mun Leong
  • CapitaLand Limited
  • Martin Lipton
  • New York University
  • Wachtell, Lipton, Rosen & Katz
  • Liu Mingkang
  • China Banking Regulatory Commission (CBRC)
  • Dinesh C. Paliwal
  • Harman International Industries
  • Leon Pasternak
  • Bank of America Merrill Lynch
  • Tim Payne
  • Brunswick Group
  • Joseph R. Perella
  • Perella Weinberg Partners
  • Baron David de Rothschild
  • N M Rothschild & Sons Limited
  • Dilhan Pillay Sandrasegara
  • Temasek Holdings
  • Shao Ning
  • State-owned Assets Supervision and Administration Commission of the State Council of China (SASAC)
  • John W. Snow
  • Cerberus Capital Management, L.P.
  • Former U.S. Secretary of Treasury
  • Bharat Vasani
  • Tata Group
  • Wang Junfeng
  • King & Wood Mallesons
  • Wang Kejin
  • China Banking Regulatory Commission (CBRC)
  • Wei Jiafu
  • China Ocean Shipping Group Company (COSCO)
  • Yang Chao
  • China Life Insurance Co. Ltd.
  • Zhu Min
  • International Monetary Fund

Legal Roundtable

  • Dimitry Afanasiev
  • Egorov Puginsky Afanasiev and Partners (Moscow)
  • William T. Allen
  • NYU Stern School of Business
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Johan Aalto
  • Hannes Snellman Attorneys Ltd (Finland)
  • Nigel P. G. Boardman
  • Slaughter and May (London)
  • Willem J.L. Calkoen
  • NautaDutilh N.V. (Rotterdam)
  • Peter Callens
  • Loyens & Loeff (Brussels)
  • Bertrand Cardi
  • Darrois Villey Maillot & Brochier (Paris)
  • Santiago Carregal
  • Marval, O’Farrell & Mairal (Buenos Aires)
  • Martín Carrizosa
  • Philippi Prietocarrizosa & Uría (Bogotá)
  • Carlos G. Cordero G.
  • Aleman, Cordero, Galindo & Lee (Panama)
  • Ewen Crouch
  • Allens (Sydney)
  • Adam O. Emmerich
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Rachel Eng
  • WongPartnership (Singapore)
  • Sergio Erede
  • BonelliErede (Milan)
  • Kenichi Fujinawa
  • Nagashima Ohno & Tsunematsu (Tokyo)
  • Manuel Galicia Romero
  • Galicia Abogados (Mexico City)
  • Danny Gilbert
  • Gilbert + Tobin (Sydney)
  • Vladimíra Glatzová
  • Glatzová & Co. (Prague)
  • Juan Miguel Goenechea
  • Uría Menéndez (Madrid)
  • Andrey A. Goltsblat
  • Goltsblat BLP (Moscow)
  • Juan Francisco Gutiérrez I.
  • Philippi Prietocarrizosa & Uría (Santiago)
  • Fang He
  • Jun He Law Offices (Beijing)
  • Christian Herbst
  • Schönherr (Vienna)
  • Lodewijk Hijmans van den Bergh
  • Royal Ahold (Amsterdam)
  • Hein Hooghoudt
  • NautaDutilh N.V. (Amsterdam)
  • Sameer Huda
  • Hadef & Partners (Dubai)
  • Masakazu Iwakura
  • Nishimura & Asahi (Tokyo)
  • Christof Jäckle
  • Hengeler Mueller (Frankfurt)
  • Michael Mervyn Katz
  • Edward Nathan Sonnenbergs (Johannesburg)
  • Handel Lee
  • King & Wood Mallesons (Beijing)
  • Martin Lipton
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Alain Maillot
  • Darrois Villey Maillot Brochier (Paris)
  • Antônio Corrêa Meyer
  • Machado, Meyer, Sendacz e Opice (São Paulo)
  • Sergio Michelsen Jaramillo
  • Brigard & Urrutia (Bogotá)
  • Zia Mody
  • AZB & Partners (Mumbai)
  • Christopher Murray
  • Osler (Toronto)
  • Francisco Antunes Maciel Müssnich
  • Barbosa, Müssnich & Aragão (Rio de Janeiro)
  • I. Berl Nadler
  • Davies Ward Phillips & Vineberg LLP (Toronto)
  • Umberto Nicodano
  • BonelliErede (Milan)
  • Brian O'Gorman
  • Arthur Cox (Dublin)
  • Robin Panovka
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Sang-Yeol Park
  • Park & Partners (Seoul)
  • José Antonio Payet Puccio
  • Payet Rey Cauvi (Lima)
  • Kees Peijster
  • COFRA Holding AG (Zug)
  • Juan Martín Perrotto
  • Uría & Menéndez (Madrid/Beijing)
  • Philip Podzebenko
  • Herbert Smith Freehills (Sydney)
  • Geert Potjewijd
  • De Brauw Blackstone Westbroek (Amsterdam/Beijing)
  • Qi Adam Li
  • Jun He Law Offices (Shanghai)
  • Biörn Riese
  • Mannheimer Swartling (Stockholm)
  • Mark Rigotti
  • Herbert Smith Freehills (Sydney)
  • Rafael Robles Miaja
  • Robles Miaja (Mexico City)
  • Alberto Saravalle
  • BonelliErede (Milan)
  • Maximilian Schiessl
  • Hengeler Mueller (Düsseldorf)
  • Cyril S. Shroff
  • Cyril Amarchand Mangaldas (Mumbai)
  • Shardul S. Shroff
  • Shardul Amarchand Mangaldas & Co.(New Delhi)
  • Klaus Søgaard
  • Gorrissen Federspiel (Denmark)
  • Ezekiel Solomon
  • Allens (Sydney)
  • Emanuel P. Strehle
  • Hengeler Mueller (Munich)
  • David E. Tadmor
  • Tadmor & Co. (Tel Aviv)
  • Kevin J. Thomson
  • Barrick Gold Corporation (Toronto)
  • Yu Wakae
  • Nagashima Ohno & Tsunematsu (Tokyo)
  • Wang Junfeng
  • King & Wood Mallesons (Beijing)
  • Tomasz Wardynski
  • Wardynski & Partners (Warsaw)
  • Rolf Watter
  • Bär & Karrer AG (Zürich)
  • Xiao Wei
  • Jun He Law Offices (Beijing)
  • Xu Ping
  • King & Wood Mallesons (Beijing)
  • Shuji Yanase
  • OK Corporation (Tokyo)
  • Alvin Yeo
  • WongPartnership LLP (Singapore)

Founding Directors

  • William T. Allen
  • NYU Stern School of Business
  • Wachtell, Lipton, Rosen & Katz
  • Nigel P.G. Boardman
  • Slaughter and May
  • Cai Hongbin
  • Peking University Guanghua School of Management
  • Adam O. Emmerich
  • Wachtell, Lipton, Rosen & Katz
  • Robin Panovka
  • Wachtell, Lipton, Rosen & Katz
  • Peter Williamson
  • Cambridge Judge Business School
  • Franny Yao
  • Ernst & Young

Amendment to Civil Procedural Law

CHINESE UPDATE – China to Amend Civil Procedural Law

Editors’ Note:   Contributed by Fang He, a partner at Jun He and a member of XBMA’s Legal Roundtable.  Ms. He has broad experience in M&A, outbound investment, foreign direct investment, private equity and intellectual property.  Authored by Mr. Luming Chen. A partner at Jun He’s dispute resolution practice group, Mr. Chen has over 20 years of experience in practicing PRC law, with a focus on international arbitration and cross-border dispute resolution matters. Ms. Qiao Peng, an associate at Jun He, helped prepare the article.

Highlights:

The Draft Amendment contains substantial changes to the Civil Procedural Law, with an aim to solve many practical problems in civil trials from small claims to enforcement. One of the fundamental legislative purposes of the current amendment is to provide more rights to Chinese citizens in civil trials, and to make the country’s civil trial system more transparent.  It is also observed that the proposed amendment published for public comments has drawn heated public debates on many issues from both the general public and legal professionals. 

Main Article

In recent years, China has continuously reformed its legal system, and has gained significant experience in judicial practices.  However, China continues to meet new challenges to be addressed by new or amended laws.  Against this background, the Draft Amendment to the Civil Procedural Law of the PRC (the “Draft Amendment”) was published for public comments on October 29, 2011.  When the final amendment is promulgated, it will be the first time that the PRC Civil Procedural Law is substantively amended since its enactment in 1991, and it will have a major impact on how civil disputes will be handled in China.  We list below some of the most important changes and supplements introduced by the Draft Amendment.

Pre-trial Mediation in Civil Procedure

Mediation is an important form of judicial practice in China.  A Court will often attempt to mediate during the trial of a civil case, because it is a traditional and efficient way to resolve disputes between the parties while maintaining their future relationships.  If a settlement is reached, the court can render a judgment based upon the settlement agreement (a consent judgment), which is directly enforceable.

China has a long-established system of “the People’s Conciliation Committee,” whose main function is to receive requests from parties to mediate a dispute before trial.  A settlement reached under the guidance of a conciliation committee is not directly enforceable.  In recent years, as China’s economy is continuing to grow, caseloads in court are becoming increasingly heavy.  The Draft Amendment attempts to resolve this problem by creating a new mechanism for formal pre-trial mediation.  Before the trial begins, the court may try to settle disputes that have not been handled or resolved by the People’s Conciliation Committee.  If successful, the court can directly issue a settlement agreement that is enforceable. A trial is no longer necessary, thereby saving judicial resources.

Public Interest Litigation

The PRC Tort Liability Law enacted in 2010 grants Chinese citizens the statutory right to sue companies for tort damages.  However, for most claims that involve environmental pollution and food safety, individuals who act as the plaintiffs are in a weak position against large corporate defendants. To better protect the interests of individual victims and to prevent further injury to the general public, the Draft Amendment proposes to grant relevant institutions and social organizations a legal standing to file lawsuits where public interests are at stake.  The Draft Amendment limits public interest litigation to cases involving environmental pollution and consumer rights.

Access to Court Records

China is primarily a “civil law” jurisdiction, with a system that uses statutes as the major source of law and does not officially recognize the authority of precedents as in the common law system.  Nonetheless, the capability to make a reference to decided cases similar in facts and legal principles can provide significant guidance for winning an argument before a court in practice.  Thus far a problem has been that court records are not open to the public but are only available to the parties for their own cases. To solve this problem, the Draft Amendment proposes that all the final judgments and rulings be made accessible to the public. Understandably, more transparency will improve the quality of trials, and judgments and will provide parties with more opportunities to cite cases as a reference when arguing in court.

Enforcement

One of the most-cited challenges to the civil litigation system in China is the difficulty to enforce a judgment.  In practice, judgment creditors will gather and provide to the court relevant information on the locations of judgment debtors’ properties, while on the other hand it is relatively easy for a debtor to evade enforcement measures. To better protect judgment creditors, the Draft Amendment increases the maximum financial penalty for bad-faith evasion of enforcement up to RMB 100,000 for an individual and up to RMB 1 million for an entity.  The Draft Amendment also proposes to introduce detention measures as a form of penalty and suggests that a party that intentionally evades the enforcement of an effective judgment or arbitration award could face criminal liability.

In addition, the Draft Amendment proposes to introduce a new procedure of “pre-judgment enforcement” by plaintiffs. Besides property preservation, a plaintiff can also apply for a pre-judgment injunction to require a defendant to do or refrain from doing specific acts.

Conclusions

The above features are only some of the highlights of the Draft Amendment. Other interesting amendments are also important, including new rules on evidence production, on making small-claim judgments final at the trial court level, and on requiring courts to provide written reasons for refusal to hear a case.  It remains to be seen which parts of the Draft Amendment will eventually become law, but this initiative has already drawn much publicity and heated public discussions on some topics.

The views expressed herein are solely those of the author and have not been endorsed, confirmed, or approved by XBMA or any of the editors of XBMA Forum, nor by XBMA’s founders, members, contributors, academic partners, advisory board members, or others. No inference to the contrary should be drawn.

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