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Chen Fuyong: Supporting Exemplars of Best Practice and Achieving New Outcomes in Promoting the Joint Construction of the "One-Stop" Diversified International Commercial Dispute Resolution Platform

From:          Updated: 2022-09-21   

Editor's Note: The Third Seminar of the International Commercial Expert Committee of the Supreme People's Court and Reappointment Ceremony of the First Group of Expert Members was held successfully on Augest 25, 2022. Over 40 experts from more than 20 countries and regions focused on the theme of the Development, Challenges and Countermeasures of Cross-Border Commercial Disputes during the seminar. Extensive and in-depth discussions were held within the framework of four specific issues. The texts of speeches delivered by the participants would be posted on the CICC's website. 


Chen Fuyong

Deputy Secretary-General of Beijing Arbitration Commission /Beijing International Arbitration Center

The China International Commercial Court's (CICC)"One-Stop" Diversified International Commercial Dispute Resolution Platform ("One-Stop Mechanism") provides parties with a convenient, fast, and low-cost way to resolve diversified disputes, supports the development of arbitration and mediation, and their connection with litigation, and provides a dispute resolution mechanism for the high-quality development of the "Belt and Road Initiative". The Beijing Arbitration Commission/Beijing International Arbitration Center ("BAC/BIAC"), one of the first five arbitration institutions to be included in the One-Stop Mechanism, is also aiming to promote integration between mediation, arbitration, and litigation in order to achieve the professional and international development of this diversified dispute resolution mechanism. In the next step, BAC/BIAC will continue to support the One-Stop Mechanism in its role of best practice exemplar, promote information exchange and talent cultivation, and advance the joint construction of the One-Stop Mechanism to achieve new outcomes.

I. The One-Stop Mechanism provides a dispute resolution mechanism for the high-quality development of the "Belt and Road Initiative"

Transnational investment transactions have a natural need for a professional, efficient, and easy-to-execute dispute resolution mechanism. Countries along the "Belt and Road Initiative" route are characterized by large geographical areas, diverse languages, and varied legal systems, making it even more necessary to build a dispute resolution system that is adaptable to parties' needs. In practice, some enterprises are constrained by the fact that they failed to carefully consider the design of their dispute resolution clauses at the beginning of the project, and China's foreign-related legal talent pool is not yet sufficient, which introduces difficulties for later dispute resolution.[1] Research published in the Dispute Resolution Report on International Construction Projects along the Belt and Road Route released by BAC/BIAC[2] also reflects the above observation. Among the enterprises participating in construction projects along the "Belt and Road Initiative" route, the preferred dispute resolution methods are negotiation or high-level talks, commercial arbitration, and commercial mediation. Overseas arbitration institutions are chosen for most arbitration cases, mainly due to the lack of discourse in the contracting process and the fact that the contract governing law is not Chinese law. In the context of diversified commercial disputes, continuously improving the negotiation, professionalism, and internationalization of dispute resolution is valuable for promoting the diversified settlement of international commercial disputes in China, which will undoubtedly help the realization of the "Belt and Road Initiative".[3]

In commercial arbitration, the One-Stop Mechanism includes several arbitration institutions with advantages in terms of the number of international commercial cases they accept, international influence, and the construction of informatization, thereby realizing the transition of litigation and arbitration by providing judicial support and convenience for parties to settle disputes through arbitration. To date, CICC has issued five judgments involving the confirmation of arbitration agreements and applications for setting aside arbitral awards.[4] The thinking behind the judgments in these cases on issues such as the applicable law, relationship between the formation of a contract and the validity of an arbitration agreement, and relationship between the parties' agreement and the Arbitration Rules, all reflect CICC's profound understanding of commercial arbitration and longstanding judicial attitude of supporting parties' willingness to arbitrate.

The One-Stop Mechanism provides parties with a comprehensive range of dispute resolution mechanisms, helping to encourage collaboration and promote integration between litigation, mediation, and arbitration. Establishing this platform will also lead to the development of new ideas, promote commercial arbitration, commercial mediation and other diversified dispute resolution methods, and increasingly improve the back-end protection mechanism for the "Belt and Road Initiative".

II. BAC/BIAC aims to build a world-class arbitration institution that faces the world and actively builds a diversified dispute resolution platform

(1) Aiming to build an international world-class arbitration institution and continuously improving the standard of internationalized commercial arbitration services

BAC/BIAC has always upheld the values of "Independence, Impartiality, Professionalism, Efficiency, and Excellence". Over the past decade, the number of arbitration cases and amounts in dispute has continued to reach record highs, the range of parties served has continued to expand nationally and internationally, and the quality and efficiency of cases handled have remained high. In 2021, 7,737 cases were accepted involving an amount in dispute of RMB 104.226 billion, setting record highs for both number of cases and amount in dispute. In recent years, the number of international cases accepted has maintained a high growth rate. In 2020, it exceeded 200 cases for the first time, reaching 215 cases, then 249 cases in 2021. At present, BAC/BIAC has a total of 692 arbitrators, including 170 arbitrators from Hong Kong SAR, Macao SAR, province of Taiwan, and foreign countries.

In recent years, BAC/BIAC has continued to make innovations to its Arbitration Rules. In 2019, it took the lead in distinguishing between the arbitrator's fees and administration fees in Chinese mainland, and stipulated that the arbitrator's fees could be calculated on the basis of an hourly rate; and in 2022, BAC/BIAC clarified that the arbitral tribunal has the right to determine whether to hold hearings online or on-site according to the specific circumstances of the case, which significantly alleviated the influence of the COVID-19 outbreak on on-site hearings.

BAC/BIAC is actively building a case management system that accords with international standards in order to meet the diversified service needs of international parties: it is the first Chinese mainland arbitration institution to introduce an arbitrators' information disclosure system; it accepted the first arbitration case in Chinese mainland to apply the emergency arbitrator procedure, and the interim decision in the case was granted an enforcement order by the Court of First Instance of the High Court in Hong Kong SAR; arbitral awards made by BAC/BIAC have been recognized and enforced in many countries and regions; and its procedural orders have been adopted in international cases. In 2021, 11 cases agreed to use English as the language of arbitration, 10 cases agreed to apply international conventions or foreign law, and foreign arbitrators were selected or designated 83 times. In the context of the COVID-19 epidemic, a total of 398 cases were heard online in 2021.

BAC/BIAC has also issued guiding documents in line with mainstream international practices which are widely applicable, including Guidelines on the Format of Arbitral Awards in International Cases, Guidelines on Currencies and their Interest and Exchange Rates in International Arbitrations, Working Guidelines on Online Hearings, Operational Guidelines on Calculating Arbitrator's Fees with Hourly Rates, Guideline Checklist on the Preparation of Materials for Parties' Arbitration Applications and Guideline Checklist on the Preparation of Materials for Applications for Preservation Measures.

(2) Building a diversified dispute resolution platform to meet the manifold dispute resolution needs of parties

BAC/BIAC has an independent mediation center to provide parties with independent commercial mediation services, and actively cooperates with other social organizations to promote theoretical and practical research on the connection between mediation and arbitration. In 2009, the Construction Dispute Board Rules were implemented to provide detailed procedural guidelines for parties to promptly resolve construction disputes through dispute review; in 2019, the International Investment Arbitration Rules were released; and in 2021, the Panel of Arbitrators for International Investment Arbitration and Code of Conduct for Arbitrators in International Investment Disputes were released and received special coverage in leading international arbitration media outlet Global Arbitration Review.

(3) Responding to the "Belt and Road Initiative" and jointly building a "Belt and Road Initiative" dispute resolution mechanism

In 2017, BAC/BIAC actively participated in founding the China-Africa Joint Arbitration Center and established its Beijing branch. In the same year, it jointly launched the "Belt and Road Arbitration Program" with the Kuala Lumpur Regional Center for Arbitration (now known as the Asian International Arbitration Centre) and Cairo Regional Centre for International Commercial Arbitration. In 2021, at the 30th Annual Meeting and Conference of the Inter-Pacific Bar Association, BAC/BIAC successfully held a symposium themed "Dispute Resolution along the Belt and Road: Empirical Study and Practical Solutions from China" and officially released the Dispute Resolution Report on International Construction Projects along the Belt and Road Route to better respond to the practical needs and expectations of Chinese enterprises for dispute resolution in construction projects along the route of the Belt and Road Initiative.

III. BAC/BIAC supports the One-Stop Mechanism in the role of best practice exemplar and promotes the joint construction of the One-Stop Mechanism to achieve new outcomes

(1) Supporting the One-Stop Mechanism in the role of best practice exemplar

In the past three years, following the establishment of the One-Stop Mechanism, several local courts have constructed diversified mechanisms for resolving international commercial disputes. On January 20th, 2021, the International Commercial Dispute "One-Stop" Diversified Dispute Resolution Center of the Beijing Court was established, and BAC/BIAC became one of the first arbitration institutions on the platform. As the "Chinese solution" to commercial dispute resolution in a strategically advantageous position,[5] the One-Stop Mechanism has made innovative breakthroughs and achievements in many aspects, such as the ascertainment of foreign laws, jurisdiction of international commercial arbitration, evidence in foreign-related commercial litigation, and reasoning in specific judgments, and will continue to lead the further promotion of diversified dispute resolution concepts and experience in international commercial disputes. In the future, BAC/BIAC will continue to support the One-Stop Mechanism in the role of best practice exemplar and promote the dissemination and popularization of the concept and experience of the One-Stop Mechanism.

(2) Strengthening cooperation in research and exchange of information 

The One-Stop Mechanism requires all litigation, arbitration, and mediation parties to cooperate and share information. On the one hand, BAC/BIAC is committed to promoting the consolidation of knowledge and practical experience of diversified dispute resolution, promoting research in frontier areas of the industry, and forming a systematic research scheme; in the future, BAC/BIAC will increase its investment in research into international commercial dispute resolution mechanisms, and provide intellectual support for the One-Stop Mechanism. On the other hand, BAC/BIAC makes full use of modern methods such as information technology and big data analysis to develop a case management system in which procedures such as case filing, tribunal formation, hearings, and evidence exchange can be carried out online. In the future, BAC/BIAC will provide convenient and efficient arbitration services to all parties through their connection to the one-stop information platform.

(3) Speeding up the cultivation of foreign-related legal talent

As Chinese enterprises "go out" with capital and technology, their voices in various investment and construction transactions continue to get louder, and they will undoubtedly gain more agency in the choice of dispute resolution. Thus, it is necessary to speed up the cultivation of foreign-related legal talent. BAC/BIAC has been focusing on cultivating talent in international commercial arbitration and contributing to the promotion of foreign-related legal talent, including conducting internship programs for domestic and foreign students, offering a series of courses in 11 universities on international commercial arbitration practice such as "Theory and Practice of International Commercial Arbitration", "English Contract Law", and "Law of Evidence", and setting up scholarships in ten central and western universities. In the next step, BAC/BIAC will further cultivate foreign-related arbitrators' ability to hear international cases, build an education base for foreign-related arbitration talent, increase the reserve of foreign-related legal talent, and effectively enhance the ability of all parties to participate in international commerce.

[1] See Chu Ouya: "The Value and Construction of China's International Arbitration Mechanism under the "Belt and Road Initiative"in Studies on the Rule of Law in Beijing (2017), edited by Xu Chuanxi, Law Press · China, November 2017 edition.

[2] "Official Release of the Chinese Version of the Dispute Resolution Report on International Construction Projects along the Belt and Road Route", http://www.bjac.org.cn/news/view?id=3919, last accessed on August 4th, 2022.

[3] Feng Shuo, Wang Yu:"The Theoretical Basis and System Formation of the Diversified Resolution of International Commercial Disputes” in Collected Papers of "Legal Studies, Shanghai", Vol. 2, 2022.

[4]  (2019) Zui Gao Fa Min Te 1, 2, 3, 4, 5.

[5] See "The China International Commercial Court (CICC) in 2018" in China Trial News Semimonthly No. 226, https://www.court.gov.cn/zixun-xiangqing-173282.html, last accessed August 4th, 2022. "In other countries' international commercial courts, there is only one way to resolve the dispute: litigation; whereas when parties enter the CICC, they can choose to resolve the dispute through mediation, arbitration, or litigation. The main highlight of this mechanism also lies in the convenient and efficient transition between litigation and mediation or arbitration." See Long Fei, Sun Yating, "The Institutional Construction and Innovation of the International Commercial Court in the Construction of the 'Belt and Road'", in Legal Research on the 'Belt and Road' Vol. 4, China University of Political Science and Law Press, 2021 edition.

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*The original text is Chinese and has been translated into English for reference only. If there is any inconsistency or ambiguity between the Chinese version and the English version, the Chinese version shall prevail.