Rely on the most comprehensive, up-to-date legal content designed and curated by lawyers for lawyers
Work faster and smarter to improve your drafting productivity without increasing risk
Accelerate the creation and use of high quality and trusted legal documents and forms
Streamline how you manage your legal business with proven tools and processes
Manage risk and compliance in your organisation to reduce your risk profile
Stay up to date and informed with insights from our trusted experts, news and information sources
Access the best content in the industry, effortlessly — confident that your news is trustworthy and up to date.
With over 30 practice areas, we have all bases covered. Find out how we can help
Our trusted tax intelligence solutions, highly-regarded exam training and education materials help guide and tutor Tax professionals
Regulatory, business information and analytics solutions that help professionals make better decisions
A leading provider of software platforms for professional services firms
In-depth analysis, commentary and practical information to help you protect your business
LexisNexis Blogs shed light on topics affecting the legal profession and the issues you're facing
Legal professionals trust us to help navigate change. Find out how we help ensure they exceed expectations
Lex Chat is a LexisNexis current affairs podcast sharing insights on topics for the legal profession
Printer Friendly Version
following the jurisdictional turf war between CIETAC and its former sub-commissions and the recent decisions of the Shanghai and Shenzhen courts confirming the legitimacy of the newly established Shanghai International Arbitration Centre (“SHIAC”)
and Shenzhen Court of International Arbitration (“SCIA”) will be interested to read the following update from Amy Lo and Terence Wong of Hogan Lovells.
The approach adopted in these cases was confirmed in two recent decisions by the Shenzhen court (on 21 January 2015) and the Beijing court (on 13 February 2015) (“the Recent Decisions"). In both cases, the court ruled that the SCIA (as opposed to
CIETAC Beijing) has jurisdiction over the arbitration.
The Recent Decisions arose from the same dispute between Walmart (Anhui) Commercial Retail Limited (“Walmart Anhui“) and Huangshan Tianyinfudi Property Development Company (“Huangshan“) over a lease agreement dated 10 February
2011. Pursuant to the agreement, disputes are to be resolved by arbitration at “CIETAC’s South China sub-commission”. The jurisdictional issue resulted from the parties referring the dispute to different bodies for arbitration: Walmart
Anhui commenced arbitration proceedings at SCIA in May 2014; Huangshan began proceedings at CIETAC Beijing in July 2014. Huangshan argued before the Beijing No. 2 Intermediate Court that SCIA did not have jurisdiction to hear the arbitration, and
that instead, the arbitration should be submitted to the CIETAC South China office in Shenzhen. After it was notified of the arbitration proceedings at CIETAC Beijing, Walmart Anhui sought a ruling on the issue from the Shenzhen Intermediate Court.
The Shenzhen court gave its decision first, upholding the validity of the arbitration clause and ruling that SCIA has jurisdiction to hear the arbitration. The Beijing court subsequently reached the same conclusion. It considered that SCIA is an arbitration
commission duly established by the Shenzhen Municipal government, and recognized the legitimacy of the name change from “CIETAC South China sub-commission” to SCIA. The Beijing court referred to article 12(1) of the Supreme People’s
Court Interpretation on the PRC Arbitration Law, under which any objection to validity of an arbitration clause must be made to the intermediate court where the arbitration commission is located. The Beijing court therefore concluded that it lacked
jurisdiction to hear the case and transferred it to the Shenzhen Intermediate Court.
Whilst the recent decision of the Beijing court (a court in the capital city of the PRC) seems to suggest that the Supreme People’s Court in Beijing has now recognised the legality of SHIAC and SCIA, there remains to be some uncertainty with regard
to clauses that provide for arbitration at “CIETAC Shanghai sub-commission” or “CIETAC South China sub-commission”.
In particular, it is to be noted that the arbitration clause in the Beijing case was entered into in February 2011, before the former CIETAC South-China sub-commission changed its name to “SCIA” in December 2012. It therefore remains unclear
whether the current “CIETAC Shanghai sub-commission” or “CIETAC South China sub-commission” (re-organized by CIETAC after the breakaway of the former sub-commissions) or the “SHIAC”/ “SCIA” would have
jurisdiction where the arbitration clause provides for submission of disputes to “CIETAC Shanghai sub-commission”/ “CIETAC South China sub-commission” after the name changes of the SHIAC and the SCIA.
To avoid the risk of jurisdictional challenges, parties who wish to arbitrate in Shanghai or Shenzhen should have their arbitration clauses carefully drafted, and may consider choosing less controversial arbitration institutions such as CIETAC’s
headquarters in Beijing to administer the arbitration.
0330 161 1234