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optionFair rules on biz disputes


2003-02-11
China Daily


A plan is underway to revise the Arbitration Law to make China more business-friendly and more amicable for arbitration seekers.

"The present Arbitration Law needs changing to protect the autonomy of arbitration parties, to make the procedure more flexible, so as to meet the requirements of modern commerce development."

The remark was made by Wang Shengchang, vice-chairman of the China International Economic and Trade Arbitration Commission (CIETAC), in an interview with China Daily yesterday.

A team of experts at CIETAC are carrying out all the necessary preparatory work to revise the eight-year-old law.

Their research findings will be passed on to the NPC Standing Committee, the national law-making body, Wang said.

Meanwhile, CIETAC will also be working out some special procedural rules to ensure the fair and efficient settlement of disputes, especially in a way that is less time consuming. But Wang declined to elaborate on the rules that are still being drawn up.

The Arbitration Law was enacted by the NPC Standing Committee in 1994 and came into effect in 1995.

Some provisions of the law are outdated even though they all played an important role in the course of the development of arbitration services in China, Wang noted.

For example, he said, the law stipulates that all arbitration should be institutional arbitration and does not recognize ad hoc arbitration.

"But now we should have ad hoc arbitration, because it's a very popular method in the world and can offer greater choice to parties involved," said Wang, who is also director of the Legal Affairs Department of the China Council for the Promotion of International Trade.

Wang said the rule, under which parties have to choose arbitrators from a list, has left out the possibility of other experts offering their services.

He further contended that the law should be more flexible towards the validity of arbitration agreements.

In their current practice, Chinese courts tend to overrule the validity of arbitration agreements for some minor defects, Wang said. But they should instead follow the international practice and adopt a policy in favour of the validity of arbitration agreements.

Wang said he and his colleagues are expecting the proposed revisions to be approved in 2005, the 10th year when the existing Arbitration Law is in place.

In order to strengthen its hard-won prestige in the world, the CIETAC will embark on a large-scale effort this year to train arbitrators and to enlist experts from other professional fields to join its arbitration panel, Wang said.

CIETAC will provide continuing education to its 518 arbitrators while soliciting expertise from such industries as construction, financial and securities services, and information technologies.

Last year, CIETAC handled 468 arbitration requests involving overseas parties and another 216 domestic requests. All these cases involved a total of 11.3 billion yuan (US$1.4 billion) under disputes.

Wang attributed CIETAC's success to its adherence to institutional independence and impartiality in its practice.

Around one-third of CIETAC's 518 arbitrators come from more than 20 countries or regions including the US, UK, Japan, Sweden, Singapore and Hong Kong.