Public policy clause in law and judicial practice of the People’s Republic of China

Abstract

The article presents an analysis of approaches to applying the public policy clause as a ground for refusing recognition and enforcement of foreign arbitral awards in Chinese judicial practice. The study also addresses issues related to the enforcement of “internal” arbitral awards in China. The choice of this legal order for the study is that the public policy clause appeared in Chinese law relatively recent. In addition, mainland China joined the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 only in 1987, much later than the USSR. At first, Chinese courts, like those in Russia, had a poor understanding of how to interpret and apply the public policy clause, but later the situation changed for the better. Taking into account China’s significant role in international trade, it is important to find out in which situations Chinese courts recognize public policy violations. Apart from the legal acts of the People’s Republic of China that embody the public policy clause, the article also analyzes Chinese judicial practice. A few examples of the use of this clause in domestic disputes were also studied. Based on the results of the study, it is concluded that the Chinese judicial practice has already developed a restrictive and uniform approach to the interpretation of the content of public policy. Given that it is not yet possible to draw a similar conclusion in relation to Russian judicial practice, Russian law enforcement authorities could pay attention to the approaches of the Supreme People’s Court of the People’s Republic of China, in particular, to its consistent practice of distinguishing of public policy violation from other grounds for refusal to recognize and enforce foreign arbitral awards.