2024钱伯斯诉讼全球实务指南中国篇

CHAMBERSGLOBALPRACTICEGUIDES

Litigation2024

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China:Trends&Developments

RuiLuoandYingZeng

HanKunLawOffices

CHINATrendsanddevelopmenTs

TrendsandDevelopments

Contributedby:

RuiLuoandYingZeng

HanKunLawOffices

HanKunLawOfficesisaleadingfull-servicelawfirminChina.Overtheyears,HanKunhasbeenwidelyrecognisedasaleaderincomplexcross-borderanddomestictransactionsandcompliancematters.Thefirm’smainpracticeareasincludeprivateequity,mergersandac-quisitions,internationalanddomesticcapitalmarkets,investmentfunds,assetmanagement,compliance,bankingandfinance,aviationfi-nance,foreigndirectinvestment,antitrust/com-petition,dataprotection,privateclient/wealth

management,intellectualproperty,bankruptcyandrestructuringanddisputeresolution.Wehavenearly800professionalslocatedinoursevenofficesinBeijing,Shanghai,Shenzhen,HongKong,Haikou,Wuhan,aswellasSin-gapore,aleadingfinancialcentreintheAsia-Pacific.Allourlawyersaregraduatesoftopuniversitiesandhaveextensiveexperienceincomplexcross-bordertransactionsanddisputeresolutionascounseltobothChineseandfor-eignclients.

Authors

RuiLuoisapartneratHanKun.HispracticefocusesonIP

litigationandIP-relatedanti-

monopolydisputeresolution.Hehasparticularexpertisein

representingmultinational

clientsincomplexandhigh-stakesIP-relateddisputesinChina.Inmorethan12yearsof

practice,MrLuohasrepresentedclientsinIPdisputesbeforeallkeyIPcourtsinChina.WithhisdeepinsightsintotheIPprotectionsysteminChina,MrLuohashelpedhisclientswin

manylandmarkcases.Anumberofthese

caseshavebeenselectedasguidelinecasesbytheSupremePeople’sCourt,BeijingHighPeople’sCourt,andBeijingIPCourt.

YingZengisofcounselatHanKun.Herpracticefocusesoncommercialdisputeresolution(includingarbitrationand

litigation)andwhite-collar

litigationandinvestigations.InhermanyyearsofpracticeintheUSand

China,MsZenghasrepresentedandadvisedmultinationalanddomesticcompaniesfrom

variousindustriesinwide-rangingcomplex

commercialdisputesbeforeChinesecourts,

UScourts,andmajorarbitrationinstitutions.

MsZengistrulybilingualandculturallyfluentacrossjurisdictionsandparticularlyknownforherexpertiseinadvisingclientstohandle

cross-borderdisputes.MsZengisadmittedtopracticeinMainlandChina,Pennsylvania,andNewJersey.

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HanKunLawOffices

9/F,OfficeTowerC1

OrientalPlaza

1EastChangAnAve

DongchengDistrict

Beijing100738

PRC

Tel:+861085255500

Fax:+861085255522

Email:rui.luo@

Web:

Introduction

Inthepost-COVID-19era,China’sbusinessenvironmentandlegalregimecontinuetoevolve,bringingnewchangestothelitigationlandscape.Theyear2023hasseenseveralkeydevelopments,includingamendmentstotheCivilProceduralLaw,changesinthehighercourts’jurisdictionovercomplexdisputesandretrials,andtheabolitionofthelegalisationrequirementinlitigation.Thesechangesaimtoenhanceefficiency,fairness,andpredictabilityinChineselitigation.ThisarticleexplorestheseimportantshiftsandtheirimpactonChina’sliti-gationlandscape.

On1September2023,ChinareleaseditsnewlyamendedCivilProceduralLaw(the“AmendedCPL”).Theamendments,takingeffectfrom1January2024,primarilyfocusontheforeign-relatedcivilproceduresection,coveringabroadrangeoftopicsincludingjurisdiction,service,collectionofevidence,andrecognitionandenforcementofforeignarbitralawardsandjudg-ments.Thisisthefirstsubstantivemodificationtoforeign-relatedcivilprocedurerulessincethepassageoftheoriginalCivilProcedureLawin1991andholdspracticalsignificanceforhow

foreign-relatedcivilandcommercialcaseswillbehandledinChinainthefuture.ThisarticlefirsthighlightsthemajorchangesintheAmendedCPLandthenintroducesotherrecenttrendsanddevelopmentsinlitigationinChina.

AmendedRulesonCourtJurisdictionOver

Foreign-RelatedCases

RegardingthejurisdictionofPRCcourtsoverforeign-relatedcivilcases,theAmendedCPLhasaddedfivenewclausescomparedwiththepreviousversion(Articles277,278,280-282),andthetwoexistingclauseshavebeensupple-mentedwithrulesexpandingthescenarioswheretheChinesecourtsmayhearcasesinvolvingaforeignelement(Articles276and279).Thesenewchangesincludeaddingmorejurisdictionalnexuses,prescribingthelegalstandardofforumnonconveniens,andspecifyingthecriteriatoacceptorstayadomesticcasewhenthereisaparallellegalproceedingalreadypendingbeforeaforeigncourt.

Additionalgroundstoexercisejurisdiction

Underthe2023Amendments,thePRCcourtjurisdictionhasbeenexpandedinthreeways.Thefirstnewnexusisthe“appropriatecon-

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nection”withChina.Traditionally,theChinesecourtsmayhearcasesagainstaforeignpartywithoutdomicileinChinaunderspecifiedcir-cumstances–ie,thecontractisexecutedorper-formedinChina,thesubjectmatterorassetsavailableforseizurearelocatedwithinChina,theinfringementacttakesplaceinChina,ortheforeignpartyhasarepresentativeofficeinChina.

Inadditiontotheseconnections,theAmendedCPLempowersChinesecourtstoexercisejuris-dictionoveraforeign-relatedcasewherethedis-putehas“otherappropriateconnections”tothePRC(Article276).ThisadditionoffersChineseentitieswhoconductcross-borderbusinessesincreasedaccesstolitigationindomesticcourtswithlowercostsandenhancedefficiency.

Infact,beforethe2023Amendments,theseadditionalgroundshadalreadybeenactivelyarguedinaseriesofhigh-profilestandardessen-tialpatent-relatedmultinationallawsuitssuchasZTEvConversant(2020),OPPOvSharp(2021),OPPOvNokia(2022)andOPPOvInterdigital(2023),wheretheSupremePeople’sCourtcon-firmedChinesecourtjurisdictionoverworldwidelicensingfeedisputesbasedontheappropriateconnectionswithChina.

Thesecondaspectofthebroadenedjurisdic-tionisreflectedinthenewrulesonexpressandimpliedconsenttojurisdictionbyPRCcourts.TheAmendedCPLallowsthepartiestoselectaPRCcourttoadjudicateaforeign-relateddis-putebywrittenagreement(Article277).Despitetheprovisionitselfbeingsilentonthespecificcriteriafortheparties’forumselectionclause,itisareasonablereadingfromthecontextofthelawthattheremustbeatleastsome“appropri-ateconnection”withChina.Additionally,whenapartydoesnotchallengethejurisdictionofthecourt,answerthecomplaint,orraisecounter-

claims,thepartywillbedeemedtohaveaccept-edthejurisdictionoftheChinesecourt.

Lastly,twotypesoflitigationwhereChinesecourtshaveexclusivejurisdictionhavebeenaddedintheAmendedCPL–ie,disputesaris-ingoutofincorporation,dissolution,andliquida-tionofthebusinessentitiesregisteredinChinaandthevalidityoftheresolutionsthereof;anddisputesoverthevalidityofintellectualpropertyrightsgrantedwithinChina(Article279).Thishasfurtherbroadenedthescopeofscenariosinwhichforeign-relateddisputesfallunderthejurisdictionofPRCcourt.

Adoptionoftheforumnonconveniensdoctrine

ThedoctrineofforumnonconveniensisnottypicallyappliedinChina’slegalsystemasitisaconceptprimarilyassociatedwithcommonlawcountriesandinterpretedbycaselaws.TheAmendedCPL,forthefirsttime,adoptedthedoctrineofforumnonconveniensintotheleg-islation,allowingadefendanttoseekdismissalwhentheChinesecourtisnotthemostappropri-ateorconvenientforumtodecidethecase(Arti-cle282).Thismeansthatdespitebeinggrantedthebroadenedauthoritytoassertjurisdiction,Chinesecourtswillstilltakeapractical,flexible,andbalancedapproachtodeterminingthejuris-dictionofcross-borderdisputes.Thischangealsoreflectsanopen-mindedattitudeofChineselawmakerstoacceptandapplyconceptsfromtheinternationalcommunity.

Underthisrule,dismissalcanhappenwhenthefollowingconditionsaremetatthesametime:

•thefactsindisputedonotoccurinChinaanditwouldbeinconvenienteitherfortheChi-

nesecourtstohearthecaseorforthepartiestoparticipateinthelitigation;

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•thereisnoagreementbetweenthepartiesreferringthedisputetotheChinesecourts;

•thedisputedoesnotfallundertheexclusivejurisdictionofaChinesecourt;

•thecasedoesnotinvolvethesovereigntyissue,nationalsecurityorpublicinterestofChina;or

•itismoreconvenientforaforeigncourttoadjudicatethedispute.

Thedismissalisnecessarilywithprejudice.IfaforeigncourtrefusestohearthecaseafterthedismissalbytheChinesecourts,theplaintiffmayre-filethecaseinChina.

Co-ordinationbetweenparallelproceedings

AsChineseentitiescontinuetoexpandtheirglobalfootprint,theymaysubjectthemselvestothejurisdictionofmultiplecourts.ThisraisesthepracticalquestionofwhatChinesecourtsshoulddoifacomplaintisfiledinChinawhilelegalproceedingsarealreadypendinginafor-eigncourt.The2023Amendmentsproactivelyaddressthisissueandprovideclearrulestohelpjudgesandlitigatorsnavigatethissituation(Arti-cles280-281).

Asageneralrule,atthetimeofthefiling,theChinesecourtshavethediscretiontodecidewhethertoacceptthecasesubjecttocertainrestrictions(eg,thecaseisnotsubjecttotheexclusivejurisdictionofPRCcourtsorthecasedoesnotgiverisetonationalinterestorsecurityconcerns).Ifthecasepassesthefilingstage,theChinesecourtscanstilldismissthecaseorstaythePRCproceedingupontheapplicationbythepartiesunlessthereisanexpresswrittenagree-mentchoosingaChinesecourttohearthecase,thecaseissubjecttotheexclusivejurisdictionofthePRCcourts,orthePRCcourtsaremoreconvenienttohearthecase.Thisco-ordinationprescribedbytheamendmentsstrikesagood

balancebetweenrespectingtheparties’free-domtochooseanappropriateforumfortheirdisputeandthejudicialpowertointerveneandredressgrievancesofanaffectedparty.

FlexibleMethodsofServiceonForeignParties

CourtsinChinahavelongbeentacklingthechallengeofefficientlyservingforeignparties,oftenresultinginsignificantdelaysinforeign-relatedcases.Since1January2023,whentheSupremePeople’sCourtgrantedthedistrictcourtsjurisdictionoverfirstinstanceforeign-relatedcivilandcommercialcases,thischal-lengehasbecomeincreasinglycommonatalllevelsoftheChinesejudiciary.Inresponsetopracticalissuesfacedincourt,theAmendedCPLhasintroducedsignificantchangestotheprovisionsconcerningforeign-relatedservice.Ithassupplementedseveralalternativemeth-odsandloweredthebarrierstoexistingservicemethodstargetingforeignparties(Article283).Thesechangesinclude:

•removingtherestrictionsthatpreviously

mandatedexplicitpriorauthorisationfor

attorneysacceptingserviceonbehalfoftheprincipal,preventinganyavoidanceofservicethroughdeliberatemanipulationofthepowerofattorney;

•extendingthescopeofalternativeservicestoincludetheforeigndefendant’swhollyownedenterprisesregisteredinChina,representativeoffices,andbranchesestablishedinChina

andremovingthepriorauthorisationrestric-tions;

•allowingserviceondomesticenterprisesin

lieuofservingontheirforeignlegalrepresent-ativesorprincipalofficialswhentheyshare

co-defendantstatus;

•allowingserviceonthelegalrepresenta-

tivesorprincipalofficialsofforeigncorporate

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defendants,ifthelegalrepresentativesorprincipalofficialsarebasedinChina;

•permittingserviceviaelectronicmeanswherethereceiptcanbeconfirmedunlessprohib-

itedbythelawsofthecountrywheretherecipientislocated;

•enablingalternativeservicethroughother

methodsagreeduponbytherecipient,

providedthatsaidmethoddoesnotviolatethelawsofthecountrywheretherecipientislocated;and

•shorteningthestatutoryperiodforpublic

announcementservicefromthreemonthsto60days.

Theseamendmentscollectivelycontributetoamorestreamlinedandpracticalsystemforserv-ingforeignparties,ultimatelyenhancingtheoverallefficiencyandeffectivenessofthepro-cessinforeign-relatedcases.

ExpandedChannelstoObtainEvidenceLocatedOverseas

AsacorollaryoftheexpandedjurisdictionofChinesecourtsoverforeign-relateddisputes,efficientandpracticalmeanstoobtainevidenceoutsideChinawhilerespectingthesovereigntyofforeigncountriesneedtobeprescribed.TheAmendedCPLnotonlycontinuestorecognisethetraditionalchannels(internationaltreatiesanddiplomaticchannels)forPRCcourtstoengageinevidencecollectionoutsideChina,butitalsoaddsthreemoreoptionstoassistthepartiesingatheringevidence,ifnotprohibitedbytheapplicablelocallaw.Thesenewmeansinclude:

•whenpartiesandwitnessesareChinese

nationals,thecourtmayentrusttheChineseembassyorconsulatetoobtaintheevidenceonitsbehalf;

•thepartiesmayagreetoofferevidencebyinstantmessagingtools;and

•otherapproachesthatareagreeduponbytheparties.

ItisadvisedthattheseexpandedavenuesareonlyapplicabletothecollectionofevidencebyChinesecourtsfromoverseas,notthereverseprocess.WhenaforeigncourtneedstocollectevidencefromChina,ithastomakearequestforjudicialassistanceincompliancewithinter-nationaltreatiestowhichChinaisapartyortheprincipleofreciprocity.On30March2023,theMinistryofJusticeissuedCommonQuestionsandAnswersonInternationalCivilandCommer-cialJudicialAssistance,inwhichitreiteratedtherestrictiononforeigncourtsandpartiescollect-ingevidencedirectlyfrompartiesinChinaforuseinforeigncourtproceedings.

ClearerStandardsforRefusingtoRecogniseandEnforceForeignJudgments

ThecurrentCPLonlycontainsageneralprovi-sionontheenforcementofforeignjudgments:anapplicationtoenforceajudgmentmustbereviewedinaccordancewithinternationaltrea-tiesthatChinahasratifiedorparticipatedinorbasedontheprincipleofreciprocity;andthecourtsshouldnotrecogniseorenforceaforeignjudgmentconflictingwiththebasicprinciplesofthePRClaw,nationalsovereignty,nationalsecu-rity,orpublicinterest.The2023Amendmentssetforthfouradditionalgroundsfordenyingrec-ognitionandenforcement,including:

•theforeigncourtlacksjurisdictiontohearthecase;

•thedefendantwasnotdulysummoned,givenareasonableopportunitytopresentitscase,orproperlyrepresentedbylegalcounsel

whenthedefendantlackedthecapacitytolitigateonitsown;

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•thejudgmentwasobtainedbyfraud;and

•aChinesecourthasalreadyruledonthe

samedisputeoralreadyrecognisedarulingbyaforeigncourtonthesamedispute.

Theseadditionsnecessitateamorethoroughexaminationofproceduralaspectsofaforeignjudgmentbythecourts,aligningwithestab-lishedinternationalstandardsinthisregard.TheAmendedCPLalsoenhancestheco-ordi-nationofconcurrentproceedingsinthecontextofenforcement.IfanapplicationforenforcingaforeignjudgmentissubmittedtotheChinesecourthandlingthesamedispute,theChinesecourtmaysuspendtheongoinglitigationuntiladecisiononenforcementisrendered.

Inessence,theAmendedCPLreflectsChina’scommitmenttoestablishinganequitableandappealinglegallandscapeforbothdomesticandforeignpartiesinvolvedinlitigation.Althoughthetrueeffectoftheseamendmentswillonlybedis-cernibleaftertheirimplementationin2024,theAmendedCPLislikelytoprovidefurtherflexibil-ity,clarity,efficiency,andpredictabilityinlitigat-ingandtryingcross-borderdisputesinChina.

OtherTrendsandDevelopmentsinLitigationin2023

Continuedimplementationofpretrial

mediationinChina

TheuseofpretrialmediationinChinawasfirstintroducedbytheSupremePeople’sCourtin2010asasupplementaryapproachtocivillawsuits,anditwassubsequentlyincorpo-ratedintotheCivilProcedureLawinthe2012Amendment.Currently,thereareprimarilytwomethodsforpretrialmediationinpractice.Oneinvolvesthedocketingchamberjudgedirectlyfacilitatingmediationbetweenthepartieswithina30-daytimeframetoresolvethedisputebeforeformaldocketing.Theothermethod,knownas

thealternativedisputeresolution(ADR)mecha-nism,entailsthecourtoutsourcingmediationtoasocialorganisationwiththeparties’consent.

Withoveradecadeofimplementation,pretrialmediationhasgainedwidespreadacceptanceinChinesecourts,significantlyenhancingtheeffi-ciencyoflitigation.Forinstance,inShenzhen,andGuangdong,courtsactivelyengageinpre-litigationmediationtohelppartiessavetimeandresourcesbyresolvingdisputesbeforeenter-ingformallitigationprocedures.Therefore,itisadvisableforpartiestofamiliarisethemselveswithlocalcourtrulesandbewell-preparedtoleveragethepretrialmediationprocesseffective-ly.Thepartiesarealsoremindedtoassesstheimpactofthepretrialmediationonthestatuteoflimitations.

UpdatedregimeonheightenedjurisdictionandretrialbytheSupremeCourt

TheChinesecourtsystemconsistsoffourlevelsofcourts:theSupremePeople’sCourt,whichistheapexcourt,followedbythehigher,interme-diate,andbasicpeople’scourts,eachwithitsownjurisdictionandresponsibilities.On28July2023,theSupremePeople’sCourtissuedtheGuidingOpinionsonStrengtheningandStand-ardisingtheWorkofElevatedJurisdictionandRetrialofCases(the“Guidelines”),whichfurtherstreamlinedtheprocessofwhenandhowacasemaybesenttoahighercourtforadjudicationinthefirstinstanceandalsosetforththerulesforretrialbytheSupremePeople’sCourt.

Therulesconcerningheightenedjurisdictionareapplicabletocriminal,civil,andadministrativecases.Inthesecases,highercourtshavetheauthoritytodirectlyadjudicateeligiblecasesuponrequestfromlowercourtsorexercisingtheirinherentjurisdiction.Theseeligiblecasesincludethoseofaneworcomplexnature,or

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thosethathavesignificantlegalimplicationsforfutureapplication.Additionally,regardingretri-als,theSupremeCourthasreinstateditsauthor-itytodeterminewh