The Russian Arbitration Center Launches a Chinese Official Website

In order to break the barrier of language communication, facilitating Chinese people to better understand Russian laws and attracting Chinese customers, the Russian Arbitration Center has specially launched a Chinese version of their official website (Website Address: https://bit.ly2IQD5nc). The Chinese version also contains the arbitration rules, recommended arbitration clauses and other materials in Chinese. The Chinese website provides comprehensive, professional and rich information and will establish a good platform for the legal exchanges between China and Russia.

International Chamber of Commerce (ICC) Released 2018 Statistics of International Court of Arbitration

In 2018, 842 new cases were registered with the Secretariat, thus setting a new record for ICC. The figure is slightly lower than the 966 cases filed in 2016, which included 135 related small- claim cases arising from a collective dispute. At the end of 2018, 1,603 pending cases were being administered by the Court and 24,180 cases had been registered since the Court was established in 1923.

Out of the 2,282 parties involved in cases filed in 2018, 46% were claimants and 54% respondents. A third of the cases involved multiple parties (33%), with several respondents in the majority of cases (57%), several claimants in 26% of the cases, and several claimants and respondents in 17% of the cases. The vast majority of cases involved three to five parties (85% of multiparty cases), while some cases involved as many as 15 parties.

The cases filed cover a wide range of sectors divided in more than 20 categories (agribusiness, alimentation, business services, chemicals, plastic and rubber, construction and engineering, defence and security, education and culture, energy, environmental protection, financing and insurance, general trade and distribution, health, pharmaceuticals and body care, industrial equipment and services, leisure and entertainment, media and publishing, metals and raw materials, packaging, handling and warehouses, public institutions and organizations, telecommunications, specialized technologies, textiles, clothing, transportation).

Hong Kong High Court:

The Arbitration Party Listed in the “Discredited Person Subject to Enforcement in China” Shall Provide Guarantee

Relevant Provision:

Article V of Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“New York Convention”) provides, “1. Recognition and enforcement of the award may be refused, at the request of the party against whom it is invoked, only if that party furnishes to the competent authority where the recognition and enforcement is sought, proof that: (e) The award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made.”

Article VI of the New York Convention provides, “If an application for the setting aside or suspension of the award has been made to a competent authority referred to in article V (1) (e), the authority before which the award is sought to be relied upon may, if it considers it proper, adjourn the decision on the enforcement of the award and may also, on the application of the party claiming enforcement of the award, order the other party to give suitable security.”

In Weili Su and Flash Bright Power Limited v Shengkang Fei and Others [2019] HKCFI 1257, the core issue of this case was whether the party requesting for setting aside the arbitration award should provide security. Center to this core dispute, was the validity of the arbitration agreement between the parties, and whether the defendant failed to explain in the arbitration if his claim constituted a strong reason for setting aside the arbitration award.

Court’s View:

The Court ordered that the claimants must provide litigation security for the following reasons:

a)The defendant is a party to the arbitration clause of the Agreement, and there is an arbitration agreement between the two parties.

b)The claim that the plaintiff was deprived of his right to plead his case shall not be supported. The court did not recognize the plaintiff's claim that he had distorted the facts and used it as an excuse to support his request for setting aside the Award. In addition, a factual or legal error cannot lead to the setting aside of the Award.

c)The ease or difficulty of the enforcement of the Award should be put first when considering whether to require the applicant to provide security. Although the plaintiff’s claims that there are assets in Hong Kong will be a reference factor, it is not the only or decisive factor. In this case, there are serious problems with the personal credit of the first plaintiff, whom has been listed in the “Discredited Person Subject to Enforcement” by the Supreme People's Court of China. The second plaintiff is involved in overseas litigations and suspected of transferring assets, which may lead to difficulties in the execution of arbitration.

Beijing No. 4 Intermediate People’s Court:

The Decision to Set Aside the Case Made by the Arbitration Organization Shall Fall within the Scope of Judicial Review of the Setting Aside of Arbitration Award by the Court

Relevant Provision:

Article 551 of the Interpretations of the Supreme People’s Court on Application of the “Civil Procedural Law of the People’s Republic of China provides, “A People’s Court trying a civil lawsuit, which involves Hong Kong Special Administrative Region, Macao Special Administrative Region or Chinese Taiwan, may refer to the special provisions on procedures for foreign-related civil lawsuits.”

Article 70 of the Arbitration Law of the People’s Republic of China provides, “A people’s court shall, after examination and verification by its collegiate bench, rule to set aside an award if a party to the case provides evidence proving that the arbitration award involves one of the circumstances prescribed in Clause 1, Article 258 of the Civil Procedure Law [Article 274 of the Civil Procedural Law of the People’s Republic of China (2017 version)].”

Article 274 of the Civil Procedural Law of the People’s Republic of China (2017 version) provides, “For an arbitral award made by a foreign-related arbitration organization of the People's Republic of China, where the respondent presents evidence to prove that the arbitral award falls under any of the following circumstances, upon examination and verification by the collegiate formed by the People's Court that the assertion is true, the People's Court shall rule on non-enforcement: (1) The parties concerned have not included an arbitration clause in the contract or reached a written arbitration agreement subsequently;…”

With respect to the dispute between Chuangkai (Hong Kong) Co., Ltd. and Sinopec Group Zhongyuan Petroleum Exploration Co., Ltd., the key issues were (1) whether the “Decision 0786" (which contains the decision to set aside another arbitration case related to the applicant) made by China International Economic and Trade Arbitration Commission falls within the scope of judicial review for setting aside the arbitration; (2) where “Decision 0786” falls within the scope of judicial review for setting aside the arbitration by the court, whether the reason for which the arbitration award was set aside conforms to the provisions to set aside an arbitration award.

Court’s View:

The Court dismissed the applicant's application for the following reasons:

a)The decision made by the arbitration tribunal has the same effect as the arbitration award, which shall fall within the scope of the party to apply for setting aside the arbitration award according to the provisions of the Arbitration Law of the People's Republic of China.

The court may only set aside a foreign-related arbitral award in accordance with the first paragraph of Article 274 of the Law of the People's Republic of China (Revised in 2017), i.e. “The parties concerned have not included an arbitration clause in the contract or reached a written arbitration agreement subsequently”.