Originally from World Arbitration and Mediation Review

Preview Page

International News

Arbitration Law in China: Further Interpretations by the Supreme People's Court

On August 23, 2006, the Supreme People’s Court (the “SPC”) of the People’s Republic
of China (“China” or “PRC”) issued its Interpretation on Certain Issues with respect to the
Application of the Arbitration Law by the People's Courts ("the 2006 Interpretation") which
became effective on September 8, 2006. The 2006 Interpretation is intended to clarify the
application of certain aspects of the PRC Arbitration Law of 1994 (and certain provisions of the
Chinese Civil Procedure Law and Contract Law) concerning arbitration (both domestic and
international), most notably the provisions relating to the interpretation and validity of arbitration
agreements, enforcement of arbitration awards (including challenges) and choice of law.
The 2006 Interpretation demonstrates a change in approach by the SPC in recent years on
a number of issues and will supersede any prior inconsistent provisions in previous judicial
interpretations of arbitration law in China. Whereas a 2003 draft previously circulated, but never
formally implemented by the SPC,1 focused on foreign-related arbitrations (i.e., arbitrations with
a foreign element conducted in mainland China) and foreign arbitrations (i.e., arbitrations
conducted outside mainland China), the 2006 Interpretation applies to arbitration generally
(purely domestic, foreign related, and foreign) and, for the large part, does not make any
distinction between domestic arbitrations and foreign-related arbitrations / foreign arbitrations.2