China Signed the Convention on Choice of Court Agreement

On September 12, 2017, China government signed the Convention on Choice of Court Agreement (“Convention”). The Convention is an international treaty concluded within the Hague Conference on Private International Law on June 30, 2005 and became effective on October 1, 2015. This Convention is to ensure the validity of parties’ agreements on exclusively choosing a court to resolve the disputes in civil and commercial matters and to promote the recognition and enforcement of the relevant judgments made by the chosen court. 

In the Convention, the choice of court shall be exclusive, which means the parties shall choose courts of one specific contracting country or one or more specific courts of one contracting state. It is not required for a party to choose a specific court, it is deemed as “exclusive” if a group of chosen courts are in one country. Once the choice is made legally and validly, other courts shall suspend or dismiss proceedings.

However, the Convention does not apply to all civil and commercial fields. According to the Convention, it shall not apply to agreements where a natural person acting primarily for personal, family or household purpose is a party, or agreements relating to contracts of employment, including collective agreements; and shall not apply to the following matters:

a) the status and legal capacity of natural persons;

b) maintenance obligations;

c) other family law matters, including matrimonial property regimes and other rights or obligations arising out of marriage or similar relationships;

d) wills and succession;

e) insolvency, composition and analogous matters;

f) the carriage of passengers and goods;

g) marine pollution, limitation of liability for maritime claims, general average, and emergency towage and salvage;

h) anti-trust (competition) matters;

i) liability for nuclear damage;

j) claims for personal injury brought by or on behalf of natural persons;

k) tort or delict claims for damage to tangible property that do not arise from a contractual relationship;

l) rights in rem in immovable property, and tenancies of immovable property;

m) the validity, nullity, or dissolution of legal persons, and the validity of decisions of their organs;

n) the validity of intellectual property rights other than copyright and related rights;

o) infringement of intellectual property rights other than copyright and related rights, except where infringement proceedings are brought for breach of a contract between the parties relating to such rights, or could have been brought for breach of that contract;

p) the validity of entries in public registers.

Whatsoever, signing the Convention provides an opportunity for China to promote international trade and investment through enhanced judicial cooperation. It will further promote the effective implementation of the Belt and Road Initiative and also encourage more countries to participate in the Convention.