On 30 July 2021, China’s Ministry of Justice released the proposed “Arbitration Law of the People’s Republic of China (Revision) (Draft for Public Comment)” (hereinafter referred to as the “Revised Draft”, 中華人民共和國仲裁法(修訂)(征求意見稿)), which has made significant changes to the existing Arbitration Law. The extensive changes aim to facilitate China’s arbitration regime to be more in line with international practice.
The Revised Draft makes ground-breaking changes for the following aspects.
Firstly, the scope of arbitration will be expanded. Article 2 of the Arbitration Law (2017) stipulates that “contractual disputes and other disputes over property rights and interests between citizens, legal persons, and other organizations of equal status may be arbitrated”. The Revised Draft deletes the phrase, “of equal status” as required in the Arbitration Law (2017), and narrows the scope of “administrative disputes to be handled by administrative organs” which cannot be arbitrated from “according to the legislation” to “according to laws”, specifically referring to laws enacted by the National People's Congress and its Standing Committee. Such revision enables the arbitration in investment and sports disputes in China.
Secondly, the ad hoc arbitration regime is provided in Chapter VII, Special Provisions on Foreign-related Arbitration, allowing foreign-related arbitration cases to be settled by ad hoc arbitral tribunals.
Thirdly, the autonomy of will of the parties is prioritized in terms of the conditions for an arbitration agreement to take effect and the seat of arbitration. With regard to the conditions required for an arbitration agreement to take effect, the Revised Draft only requires the parties to “express their intention to apply for arbitration” and no longer requires the parties to agree on the “matters submitted to arbitration” and the “selected arbitration commissions”.
Fourthly, in response to the arbitration needs during the COVID 19 epidemic, arbitration proceedings can be conducted online.
Fifthly, it is to unify the standards for judicial review of domestic and foreign-related arbitration awards, shortening the period of application for setting aside arbitral awards from six months to three months and removing the provision of non-enforcement of arbitral awards upon application by the parties concerned.
Cover Photo by Scot Cris (https://unsplash.com/@scotcris) on Unsplash
Contributors: CJO Staff Contributors Team
