Application of Foreign Law in Chinese Courts

Where a civil case involves foreign elements the choice of law will be appliedon and foreign Law should come into use in the hearing thereof. On October28, 2010, the Act on Application of Laws to Civil Matters involving Foreign Element(“CPILA”) of the People’s Republic of China (“China” or “PRC”) was approved bythe Standing Committee of the National People’s Congress (“NPC”)and took effecton April 1, 2011. The Act is the first national-level law that consolidates the conflictof laws principles into a single piece of legislation. In December 2012, TheInterpretations on Several Issues Concerning Application of the Act on Applicationof laws to Civil Matters involving Foreign Element (I) (Interpretation I) was issuedby Supreme People s Court and took effect on January 7, 2013. CPILA andInterpretation I clarified the stance of Chinese law on the application of foreignlaw in civil litigation. According to CPILA and Interpretation I, It is a fundamental principle that wherea People’s Court applies foreign law as the applicable law, it has to identify thelaw ex officio. But when the applicable law is selected by parties on the basisof party autonomy allowed by conflict law of china, the parties have the obligationof assistance on ascertaining the foreign law. A people’s court may ascertain the foreign law through such means as: (1)provided by the parties in litigation; (2) the central authority determined by theagreement of judicial assistance between China and the foreign country; (3) theChinese embassy or consulate in the foreign country; (4) the foreign country’sembassy or consulate in China; or (5) Chinese or foreign legal experts. Nevertheless,it is not necessary for the judge to exhaust all above-mentioned methodsto identify the foreign law in a case. If, however, the foreign law cannot be determined despite all reasonable efforts,Chinese law shall be applied. In addition, should either party disagree with thefirst instance court about the determination on foreign law, the appeal could belodged to the appellate court for review.