Enforcing Judgments in China While Litigation in Another Country/Region
Can I sue Chinese companies in a district court in California, the U.S., or in Paris, France, and then enforce a judgment in China from those courts?
Most likely, you don’t want to have to go so far away as to sue a Chinese company. You may just want to take your case in the court on your doorstep because you are more familiar with your home state.
However, you are also aware that the vast majority or all of the assets of the Chinese company are located in China. As a result, even if you have won the lawsuit at home, you still need to have your judgment enforced in China.
Under Chinese law, you cannot enforce a judgment in China on your own initiative or through another agency. You will need to appoint a Chinese lawyer to assist you in applying to the Chinese courts for recognition of your judgment, and then for the Chinese courts to enforce your judgment.
This concerns the recognition and enforcement of foreign judgments in China.
We have many years of professional experience in this field. You can read about our four years of observations in this field on our multi-author blog, China Justice Observer.
To help you think more clearly about this, we’ve put together the following Q&A.
1. Will Chinese courts recognize and enforce the judgments of my country’s courts?
In our article “Can Foreign Judgments Be Enforced in China?“, we divide the countries and regions of the world into four groups. For the countries and regions in Groups 1 ~ 3, it is very likely to have their judgments recognized and enforced by Chinese courts.
For the countries and regions in Group 4, there is currently no evidence that Chinese courts will enforce them.
You can go check to see which Group your country belongs to.
If your country is in Group 1 ~ 3, then you would like to know more in the following Q&A part.
2. If Chinese courts can recognize and enforce my judgments, how will the Chinese court review the judgment concerned?
Chinese courts usually do not conduct a substantive review on foreign judgments. In other words, Chinese courts would not examine whether foreign judgments make mistakes in fact-finding and application of law.
However, Chinese courts will refuse to recognize the applicant’s foreign judgment under the following circumstances, specifically as follows:
(1) In accordance with the law of the country where the judgment is rendered, the judgment is not final or conclusive;
(2) In accordance with the law of the country where the judgment is rendered, the court that rendered the judgment has no jurisdiction over the case;
(3) The defendant did not receive proper notice of the judicial proceedings or have a reasonable opportunity to argue, or the defendant did not receive appropriate representation in accordance with the law of the place where the judgment was rendered;
(4) The judgment is obtained by fraud or bribery;
(5) The court of the People’s Republic of China has rendered a judgment on the same dispute between the same parties, or has recognized the judgment of the Hong Kong Special Administrative Region, the Macao Special Administrative Region, the Taiwan Region, or a third country in this regard;
(6) Recognition and enforcement of the judgment concerned will violate the basic principles of the laws of the People’s Republic of China or the sovereignty, security, and public interests of the state.
If a Chinese court refuses to recognize a foreign judgment on the grounds of the above, it will make a ruling refusing to recognize and enforce the foreign judgment. The ruling so made shall not be appealed.
If the aforesaid circumstances are not found in your judgment, the Chinese courts will recognize and enforce the judgment.
3. When should I apply to China for recognition and enforcement of my judgments?
If you apply to Chinese courts for recognition of foreign judgments or for recognition and enforcement at the same time, you should apply to Chinese courts within two years.
The commencement of the two-year period can be divided into the following three situations:
(1) Where your judgment provides for the period of debt performance, it shall be counted from the last day of that period;
(2) Where your judgment provides for the debt performance by stages, it shall be counted from the last day of each performance period as stipulated;
(3) Where your judgment does not provide for a period of performance, it shall be counted from the date when the judgment takes effect.
If you apply to a Chinese court only for recognition of your judgment, the Chinese court will make a ruling recognizing this judgment. Thereafter, if you wish to apply to a Chinese court for enforcement of this judgment, you should apply to the Chinese court within two years. The two-year period shall be counted from the effective date of the ruling of the Chinese Court on recognition of this judgment.
4. Which court in China should I apply to for recognition and enforcement of my judgment?
You may apply to a Chinese intermediate court of the place where the Chinese company is located or where the property subject to execution is located for recognition and enforcement.
5. To apply to Chinese courts for recognition and enforcement of my judgment, do I have to pay the court fees?
For the time and cost of such cases, please read our other article “Time and Expenses – Recognition and Enforcement of Foreign Judgments in China“.
When you win the case, the court fee shall be borne by the respondent.
6. When I apply to Chinese courts for recognition and enforcement of my judgment, what materials should I submit?
You need to submit the following materials:
(1) The Application Form;
(2) The applicant’s identity certificate or business registration certificate (if the applicant is a corporate body, the identity certificate of the authorized representative or the person in charge of the applicant must also be provided);
(3) The Power of Attorney (authorizing lawyers to act as agents ad litem);
(4) The original judgment and a certified copy thereof;
(5) Documents proving that the defaulting party has been duly summoned in case of a default judgment, unless otherwise stated in the judgment; and
(6) Documents proving that an incapacitated person has been properly represented, unless otherwise stated in the judgment.
If the aforementioned materials are not in Chinese, then you also need to provide the Chinese translation of these materials. The official seal of the translation agency shall be affixed to the Chinese version. In China, some courts only accept Chinese translations provided by agencies listed in their lists of translation agencies, while others do not.
Documents from outside China must be notarized by local notaries in the country where such documents are located and certified by local Chinese consulates or Chinese embassies.
7. What should be included in the Application Form?
In the Application Form, you need to give a brief description of the matter you are applying for. In addition, you can also discuss the main points in which Chinese courts are interested during examining the recognition and enforcement of foreign judgments. Generally speaking, the contents of the Application Form may include:
(1) A brief statement of the judgment, including the name of the foreign court, the case number, the commencement date of the proceeding, and the date of the judgment;
(2) Issues to be enforced by Chinese courts;
(3) The performance of the respondent and the enforcement thereto outside China;
(4) The specific property of the respondent to be enforced by Chinese courts (which can facilitate Chinese courts to identify the property of the respondent available for enforcement);
(5) Proving that your country and China have concluded international treaties on recognition and enforcement of foreign judgments, or have formed a reciprocal relationship;
(6) Proving that the judgment concerned falls into the type of foreign judgments recognizable and enforceable by Chinese courts;
(7) Proving that the court that rendered the judgment has jurisdiction over the case, and that Chinese courts have no compulsory jurisdiction over the case under Chinese law;
(8) Proving that the original court has reasonably summoned the respondent;
(9) Proving that the original judgment or ruling is final, including its reasonable service to the respondent.
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