Beijing Review

26 BEIJING REVIEW APRIL 20, 2017 http://www.bjreview.com

several reasons. China had established a legal

framework for its market economy, the legal

system had become more transparent after

China joined the World Trade Organization,

and the arbitrators were more knowledge-

able and experienced than earlier.

Gu Zhaomin, Director General of the

International Department of China Law

Society (CLS), the official organization of

Chinese legal professionals that advises the

government on legal issues, thinks the role

of arbitration has increased with the an-

nouncement of the Silk Road Economic Belt

and 21st-Century Maritime Silk Road (Belt

and Road Initiative).

ìThe main purpose of the Belt and Road

Initiative is to promote cooperation in trade

and investment, people-to-people contacts,

and cultural exchanges among countries

along the trade routes,î Gu said. ìArbitration

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disputes arising from trade cooperation. Low

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In the past, businesses went to Europe

to resolve cross-border disputes. ìBut there

were complaints that it took too long to do

the arbitration in some European cities and

it also cost a lot,î Gu said. That led to the

thought of establishing arbitration centers

closer to home.

The African angle

Chinaís arbitration history witnessed a major

development in 2015. ìThough we have legal

cooperation with many countries, China-Africa

legal cooperation is a step ahead,î Gu said. In

2015, two arbitration centers dedicated to re-

solving Sino-African commercial disputes were

opened.

The development came after China be-

came Africaís largest trading partner in 2009,

overtaking the EU and the United States. As

the volume of trade and investment grew,

so did disputes, and it was felt that a special

legal mechanism was needed to focus on

Sino-African business dispute resolution.

Consequently, the dedicated China-

Africa joint arbitration centers (CAJACs) were

established in Shanghai and South Africaís

Johannesburg. On March 27, two more

CAJACs were opened in Beijing and Kenyaís

Nairobi, followed by a third in Shenzhen two

days later.

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By Sudeshna Sarkar

there are over 200 arbitration centers in the

country, which have nearly 500 arbitrators.

The backlog of cases in courts is another rea-

son businesses head for arbitration centers.

In 2016, BIAC arbitrated in 3,000 disputes

with the total money involved reaching 40

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around 1,000 disputes involving about 10

billion yuan ($1.45 billion).

Arbitrationís edge

ìNow even courts prefer that business disputes

are handled by arbitration centers,î Lin said. ìThe

centers are under less pressure than courts.

Besides, arbitrators are qualified legal experts

like famous professors from prestigious univer-

sities who also have expertise in the industry in

which the disputes arise, like infrastructure, and

stakeholders have trust in them. Trust is the

most important thing.î

In their 2008 study, International

Arbitration in China, Howard Chen and Shu

Yujing, partners at law firm K&L Gates, re-

marked that China was accepted or even

recommended as the place of arbitra-

tion (if it involved property in China) for

L

in Zhiwei likes to quote a saying common

in legal circles: decisions by the supreme

courts of China and the United States

might not be executed, but awards issued by

arbitration courts will always be.

Thatís because, as Lin, Secretary General

of Beijing International Arbitration Center

(BIAC), explains, today 158 governments,

including China, have signed the Convention

on the Recognition and Enforcement of

Foreign Arbitral Awards, also known as the

New York Convention. It means the signa-

tories will enforce the decisions made by

one anotherís arbitration authorities, and an

award by a Chinese arbitrator will be honored

in the United States despite the differences

in their legal systems.

ìArbitration is becoming a national strat-

egy and is being adopted by many members

of the business community,î Lin said.

ìAwards are internationally enforceable, as

stipulated in the New York Convention. Also,

big companies especially want to keep their

disputes secret. Arbitration proceedings are

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effective on September 1, 1995. Today,

The China Chongqing Liangjiang International Arbitration Center is set up on April 28, 2016, to provide legal services

to domestic and foreign businesses in west China

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