Adding a little China wisdom

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Chinese arbitration has its own development track. Riding high on the goals and undertakings of making home-grown arbitration practices more international, the country also charts its course of introducing “China’s experience” and “Oriental wisdom” onto the international arbitration stage. We asked the region’s major player for their views − and their wisdom. Read the full interview with the leaders of six arbitration centres here.

I think the concept of “Sinicization of international arbitration” should be understood in a way that, during the course of integrating with international arbitration and moving onto the global stage, while learning from the advanced practices in other countries, Chinese arbitration unreservedly exports its unique experience, formed and developed in line with the fundamental reality of the country, to share, exchange and improve with counterparts in the international arbitration community, carving out a path for the joint development of international arbitration with China’s wisdom.

In the past decades of development, based on the fundamental reality of the country, Chinese arbitration has formed and developed several unique practices and experiences in the following aspects:

Arbitration
Wang Chengjie

(1) The combination of arbitration and conciliation. The China International Economic and Trade Arbitration Commission (CIETAC) first put forward such an idea and took the lead to put it into practice. With full respect to the principle of party autonomy, that is, under the premise of express consent by both parties, the efficient and fair resolution of the dispute is given top priority.

A conciliation procedure is introduced during the arbitration, allowing the arbitral tribunal to conciliate the case during the arbitral proceedings. If a settlement agreement has been reached, the parties may request the arbitral tribunal to make an award or conciliation statement based on the settlement agreement, or withdraw the case. Both parties may also agree on a settlement during or outside the arbitration, and apply to the arbitral tribunal for an award or conciliation statement, based on the settlement agreement or withdrawal of the case.

If no settlement agreement can be reached, arbitration proceedings will resume. Such practice greatly enhances the autonomy and engagement of the parties in the dispute resolution, further increases the flexibility of the arbitration proceedings, largely reduces the time, and cuts down on the monetary cost.

In the meantime, such practice takes both the confidentiality of procedures and independence of judgment into account. The conciliation statement, consent award and award are equally enforceable, ensuring that the legitimate interests of the parties can be effectively protected.

Over more than 60 years of arbitration, such a practice has been adopted by most arbitral institutions in mainland China, and quite a few internationally renowned arbitration bodies, standing as the widely recognized and accepted the “China experience” and “Oriental wisdom”. Apart from combining traditional commercial arbitration and conciliation, CIETAC seeks to promote the experience to the field of investment arbitration via the newly launched investment arbitration rules, hoping to offer a new idea to solve the issue concerning the rigid mechanism of investor-state dispute settlement.

(2) Institutional assistance to push forward the arbitral proceedings and realize high efficiency of arbitration. Institutional arbitration marks one of the most remarkable characteristics of Chinese arbitration. As the number of cases increases tremendously, and domestic and international parties cry out for more highly efficient dispute resolution, Chinese arbitral institutions have adopted several practices, such as designating a case-handling secretary to assist the arbitral tribunal in pushing forward arbitration proceedings, applying expedited or simplified procedures to simple cases with a small monetary value of claims, and clearly stipulating all kinds of deadlines in arbitration rules, including the deadline for making an award.

This introduces a set of experiences with Chinese characteristics in pushing forward the institutional arbitral proceedings, generally shortening the time of handling the arbitration cases, and winning praise from a wide range of arbitration participants for high efficiency and high quality. The United Nations Commission on International Trade Law (UNCITRAL) is pushing forward with the formulation of a unified set of rules on expedited procedures, and has consulted the CIETAC for the relevant experiences.

(3) National-level strong support on arbitration. Chinese arbitration has always enjoyed judicial and policy support at a national level. Courts take a clear and positive attitude towards judicial review and support on arbitration. Especially with regard to the recognition and enforcement of arbitral awards concerning foreign matters, specific provisions have stipulated that the withdrawal of arbitral awards concerning foreign affairs, non-enforcement, and declaration of nullity of arbitration agreements need to be reported level by level to the Supreme People’s Court (SPC). This shows great respect to and a thorough implementation of the New York Convention.

The fourth plenary session of the 18th Central Committee of the Communist Party of China has pointed in particular to perfecting the diversified dispute resolution mechanism, improving the arbitration system, and enhancing the credibility of arbitration. The SPC, China’s highest court, is devoting great efforts towards: establishing a one-stop, diversified dispute resolution mechanism; issuing judicial interpretations to clearly define the international commercial courts; joining hands with eligible international commercial arbitration agencies to set up a one-stop dispute resolution platform with access to mediation, arbitration and litigation; and supporting the parties in selecting a dispute resolution method considered to be the most suitable via such a platform. These national-level initiatives create fertile ground for the development of Chinese arbitration.

(4) Application of internet technology in arbitration. In recent years, with the explosive growth of internet technology, China has been committed to pressing ahead with the “smart court” initiative to innovate its traditional court system. Riding high on such a golden opportunity, China’s arbitration community is capitalizing on the boom in internet technology as a big push for the development of arbitration from multiple angles and levels, including innovations in forms, improvement in efficiency, and evidence fixing.

By doing so, it has rolled out new procedures and opened up new frontiers, cases in point including online arbitration and expedited arbitration procedures in the area of financial services. This greatly improves professional standards and convenience of arbitration, and achievements that have been made can also be used as a reference.

Wang Chengjie is the vice chairman and secretary-general of the China International Economic and Trade Arbitration Commission (CIETAC)