­­­­China’s Normfare an­­­d the Threat to Human Rights

16. February 2022
A new paper by Tanner Larkin
“President Cyril Ramaphosa at 2018 Forum on China-Africa Cooperation” by GovernmentZA is licensed under CC BY-ND 2.0

International human rights law is often associated with the progressive expansion of justice and freedom. But today that link cannot be taken for granted. As I discuss in my forthcoming Note in the Columbia Law Review, the People’s Republic of China (PRC) is attempting to transform human rights into an instrument of 21st century global authoritarianism. To that end, the PRC is undertaking efforts at the regional, national, and sub-national levels to socialize other actors into its preferred human rights norms through visits and exchanges, academic conferences, multilateral fora, and other means.

The PRC has long possessed a distinctive human rights vision. It recognizes the validity of human rights as a concept, but stresses an absolutist view of sovereignty according to which states are entitled to choose their human rights practices without interference; stability and development are pre-conditions for promoting human rights; and human rights are centered on the state rather than the individual. This doctrine is thus highly conducive to authoritarian rule. That the PRC holds such views on human rights is not new. What is new, especially since Xi Jinping’s ascent to power in 2012, is China’s revisionist posture in promoting its vision across the globe and in treating its conception of human rights as an alternative human rights framework, superior to the liberal status quo. This shift is powered by China’s dual aims of augmenting its soft power (and thus geopolitical influence) and neutralizing the perceived threat of liberal human rights norms to the survival of the Chinese Communist Party regime.  

China’s international human rights strategy can be thought of as “normfare,” a neologism that refers to the strategic promotion of favored interpretations of international norms. Its normfare in the human rights field is illuminated by applying Harold Koh’s transnational legal process model for how international norms develop and take root. Per Koh’s model, this occurs in three stages. First, the norm entrepreneur provokes an interaction or series of interactions with other actors. Second, the interaction forces an interpretation or enunciation of a relevant international norm. Third, the transnational actor potentially succeeds in causing the other parties to internalize the new interpretation of the norm into its own internal normative system. Successfully internalized norms may ultimately determine state behavior.

China’s human rights engagement with Africa demonstrates at least a de facto strategy of normfare to diffuse favored norms in a manner that maps onto Koh’s transnational legal process model. In the interaction phase, the PRC creates opportunities for transnational actors to engage with Chinese counterparts and learn about the PRC’s human rights vision, including through new fora such as the Forum on China-Africa Cooperation and the South-South Human Rights Forum, as well as by visits and exchanges involving African political parties, experts, lawyers, and other actors.

These interactions lead to the interpretation of norms in a manner favored by China, thus legitimizing and building consensus for China’s norms. These processes of interaction and interpretation are fueling internalization. This involves (1) social internalization, suggested by the embrace of PRC-style human rights norms by some prominent African academics; (2) political internalization, indicated by the rhetoric of certain African leaders; and (3) legal internalization, evidenced by African states such as Tanzania, Nigeria, and Zimbabwe adopting PRC-style internet-regulation statutes.

The PRC’s human rights normfare may contribute to the construction of an alternative, authoritarian international law and the furtherance of an illiberal, China-dominated global order. To avoid these outcomes, actors—above all, the United States—should push back to blunt the effects of the PRC’s normfare and rebuild a more resilient liberal human rights regime, including by implementing counter-normfare.

China’s human rights normfare poses a grave threat to the international human rights system. By fashioning an illiberal, authoritarian “human rights” doctrine, the PRC debases the coinage of human rights, supplying a currency that will prop up authoritarian regimes and undermine human rights defenders. Now is the time for action to preserve the integrity of human rights as a check on arbitrary state power and a guarantor of individual liberty.

Tanner Larkin’s paper is forthcoming with the Columbia Law Review and a draft is available here. Tanner Larkin is a second-year J.D. student at Columbia Law School, where he is a Hamilton Fellow and a James Kent Scholar. He is also a Senior Editor of the Columbia Law Review and a board member of the Columbia Society for International Law. Tanner graduated summa cum laude and Phi Beta Kappa from Georgetown University’s School of Foreign Service in 2019. He can be reached at larkin.tanner@columbia.edu or through LinkedIn.

Canaries or Colonials? Overseas Judges in Hong Kong

17. January 2022
A new paper by Stuart Hargreaves
“Hong Kong Court of Final Appeal” by johnlsl is licensed under CC BY-NC-ND 2.0

Hong Kong’s Court of Final Appeal (CFA) typically sits as a five-member panel composed of the Chief Justice, three ‘permanent’ judges, and a fifth member that may be drawn from one of two panels. The non-permanent ‘local’ panel is composed of retired members of the CFA or of the Court of Appeal. The non-permanent ‘overseas’ panel is composed of senior jurists drawn from other common law jurisdictions, in practice primarily but not exclusively from the United Kingdom and Australia.

The possibility of inviting judges from overseas to serve on the CFA was agreed to in the Sino-British Joint Declaration governing the transition of sovereignty over Hong Kong, and is codified in Hong Kong’s quasi-constitution, the Basic Law. The Basic Law, however, provides only that the CFA “may as required” invite such overseas members to serve, with no further specifics.

Hong Kong’s first Chief Justice, Andrew Li, chose to draw the fifth member from the overseas panel to join whenever possible, rather than alternating between the two non-permanent panels. This in essence became a constitutional convention and for the first twenty years of the CFA’s existence nearly every substantive case was heard by a panel that included an overseas member. They serve on renewable three-year contracts, but are not actually present in Hong Kong for that entire period – they typically fly in for a month each year to hear the cases to which they have been assigned (during COVID they have continued to participate remotely via video conference).

It is unusual that a wealthy, well-developed jurisdiction continues to import judges from overseas. While importing judges remains common in the microstates of the South Pacific, Hong Kong in no way lacks local legal talent in the same way that might justify a need to import judges. While Singapore also invites overseas judges to serve, it limits them to sitting only on a commercial court. In contrast, Hong Kong places no restrictions on the roles that the overseas judges take – when sitting they are treated as a full member of the bench.

The system is thus not without controversy. It is fair to argue that judges who make critical decisions about a community or society ought to be drawn from that society, absent good reason – yet there can be no more of an outsider than a well-paid judge flown in for one month each year. The overseas model also has an uncomfortable colonial echo to it – the judges have primarily been drawn from Hong Kong’s former colonial ruler, all have been white, and all but two have been men. There are also fair questions regarding sovereignty that may be raised – though China did agree to the system in the Joint Declaration, the historical context and China’s experience during the 19th and 20th centuries necessarily will make the role a sensitive one.

But despite these issues, for many years the overseas judges have all been regarded as jurists of the highest quality and they have contributed significantly to the CFA’s output. Previous academic work found that in the Court’s first decade they wrote roughly one-quarter of the lead opinions coming out of the CFA. These opinions dealt with an unrestricted range of matters, including some key developments in local constitutional jurisprudence. 

My paper updates this research and shows that the role has shifted in the years since, with the overseas judges now accounting for little over 15% of the Court’s output annually. Moreover, they no longer appear to write decisions related to fundamental rights or inter-jurisdictional questions related to the relationship between Hong Kong and the rest of China. I argue that this is a strategic decision by the CFA as a political actor in its own right, in an effort to preserve its institutional role. The paper suggests that the CFA perceives threats to its ability to serve as a check on an executive branch that is becoming more deeply entwined with policy initiatives that come directly from the central government.

I propose that one way in which the CFA is responding to this change is to reduce the prominence of the overseas judges whilst continuing to invite them to serve. The goal appears to be retention of the benefits they bring (in particular the idea that their presence indicates to both the international and local community that Hong Kong’s judicial independence remains intact) whilst minimizing the chance that politically sensitive decisions could be delegitimized through direct association with an overseas member. The CFA may be concerned that such delegitimization may serve to ground subsequent arguments that the concept of judicial neutrality itself is so suspect that ‘judicial independence’ should not extend to anything more than the resolution of disputes between private parties.

It is true that the neutrality or objectivity of judges is often overstated – they are all humans who are the product of cultures, upbringings, educations, environments, and so on. But this is an argument for increasing the diversity of the bench at all levels rather than an argument for curtailing the role of the courts as traditionally understood in Hong Kong. Of course, whether or not reducing the prominence of the overseas members will in fact help preserve the scope of the CFA’s role is an open question. It is unlikely to be enough on its own.

Find Stuart Hargreaves’ paper “Canaries or Colonials? The Reduced Prominence of the ‘Overseas Judges’ on Hong Kong’s Court of Final Appeal”, published in the Asian Journal of Comparative Law, here.

Prof. Hargreaves is an Associate Professor in the Faculty of Law of the Chinese University of Hong Kong, with a research focus on privacy law and constitutional law. He has law degrees from Osgoode Hall Law School (JD), the University of Oxford (BCL), and the University of Toronto (SJD), and qualified as a solicitor and barrister with the Law Society of Ontario.

Code Commentaries – A German Technique in Chinese Criminal Law?

17. December 2021
A new paper by Michael Bohlander
Codes and Commentaries – keys in German Criminal Law

Chinese criminal law scholars have increasingly been establishing links with colleagues in other jurisdictions and drawing benefits from comparative research, and more than anything else with those from Germany. As both Germany and China are at their core civil law systems, and German scholarship in criminal law historically had, and still has, a reputation abroad for a high degree of doctrinal sophistication that may appeal to other legal systems with a similar conceptual DNA. One major factor which keeps recurring in the recent Chinese debate is the dramatically increasing level of interest in a particularly Teutonic tool of legal scholarship, the code commentary.

China is currently carefully reconsidering its previous stance with regard to substantive criminal law, in that reliance on the old Soviet-based criminal code is gradually being replaced by a concept that is owned by Chinese legal scholars, practitioners and law-makers, and shaped to the indigenous principles influencing and guiding modern Chinese culture and society. In other words, Chinese criminal law is increasingly progressing to a Sino-centric understanding of law based on the founding principles of the People’s Republic, the current policies of the CPC and the more recent wider guidance by Xi Jinping Thought as expressed for example in the two volumes of collections of President Xi Jinping’s ideas, The Governance of China.

Addressing the need to ground any law reform on the prevailing conditions in China and the need to lay the “emphasis on what is practical, what is contemporary and what is quintessentially Chinese”, Xi Jinping expressly realises the benefits and risks of international and comparative engagement in the context of law reform:

“Basing our work on reality does not mean that we can develop the rule of law in isolation from the rest of the world. The rule of law is one of the most important accomplishments of human civilization. Its quintessence and gist have universal significance for the national and social governance of all countries. Therefore, we must learn from the achievements of other countries. However, learning from others does not equate to simply copying them. Putting our own needs first, we must carefully discern between the good and the bad and adopt the practices of others within reason. Under no circumstances can we engage in “all-out Westernization”, or a “complete transplant” of the systems of others, or copy from other countries indiscriminately.”

Using a “Western” tool does not eo ipso equate to crafting Western things with it, in other words: process does not equal substance. From the point of view of a Chinese domestic debate about the pros and cons of commentary use it is ultimately irrelevant whether Western lawyers approve or disapprove of the material and political essence of the legal system which the commentary is meant to elucidate. Elucidation is a worthwhile and unobjectionable aim in and of itself and, as the inevitably patchy practice of the SPC in issuing interpretative guidelines has shown, something for which the need is clearly felt at the highest echelons of the Chinese legal establishment.

The choice of analytical or conceptual lenses is paramount for the contribution a commentary can make to the development of any area of law, but certainly in the field of criminal law. This process of choice begins, however, even with the meta-question of who decides these analytical parameters: Will they be ordained by the Party structures or the SPC or will each academic (team) be free to choose their own? In the former case, it is to be expected that a much wider array of society- or community-related criteria will find entry into the project and serve as a more or less tight strait-jacket for the development. Even if the overall tendency might be to move away from the old Soviet-style model, it is unlikely that a major shift towards an ideology incompatible with modern Sino-socialist thinking would be advocated or tolerated.

It might be highly beneficial for the Chinese context to rethink the relationship between academia and practice. Judicial and wider practitioner involvement in commentary writing would appear to be crucial in order to achieve a harmonious blend of scholarly penetration of the material on an analytical basis with the views and practical experience of seasoned – and ideally also scholarly-minded – judges, prosecutors and counsel.

Finally, what shape should Chinese commentaries adopt? The easy avenue of copying the mere phenotype of the various German commentaries may make it difficult, if not to say unattractive, for the Chinese debate to reflect on its own approach from scratch, as it were. One might be tempted to say that the desire for a working commentary culture and the apparent respect for the German experience may have forestalled a proper fundamental debate within the Chinese legal community about the merits and aims of engaging in commentary writing, its underlying philosophical parameters and policy directions – in other words: Is there a particularly Chinese DNA that would give rise to a different genotype?

While the focus of this paper is on exploring the lessons that can be drawn from the German case, it is far from clear that this model is best-suited for the Chinese legal environment, possibly adding the further qualifier: At this time? The current relationship between academia and practice and the alleged lack of practitioner interest in scholarly exploration may militate in favour of a less ambitious format, at least initially: Judicial practice may be unlikely or unwilling to have recourse, leave alone contribute to commentaries if their impetus is too much focused on the academic debates of scholars and does not sufficiently address the needs of practitioners.

Overall, the situation appears rather more complex than it might seem at first glance. There are two Chinese proverbs, “Be not afraid of being slow, be afraid of standing still” (不怕慢, 就怕停), and “Teachers open the doors, you enter by yourself” (师父领进门,修行在个). In the debate about the proper use of the idea of commentaries in China, it seems that these proverbs may prove to be wise counsel.

Michael Bohlander’s paper, published with Peking University Law Journal, is now available here.

Professor Michael Bohlander holds high judicial office as the International Co-Investigating Judge in the Extraordinary Chambers in the Courts of Cambodia, having been on leave from Durham University and serving as a full-time judge at the Court in Phnom Penh from 2015 – 2019, and again since April 2020 after his re-instatement in the post by the United Nations Secretary-General, to deal with residual litigation. He is also on the roster of international judges at the Kosovo Specialist Chambers in The Hague, to which he was appointed in February 2017. His extensive published research on German, English, comparative and international criminal law has found wide reception, including outside academia. In his book series, Studies in International and Comparative Criminal Law with Hart, Liling Yue recently published Principles of Chinese Criminal Procedure.

Beyond Government Transparency in China?

30. November 2021
A paper by Chun Peng
Mauro Cateb, licensed under CC BY 2.0

Since May 1 of 2008, the Regulations on Open Government Information (the OGI Regulations, English translation here) have formally triggered the legal mandate for information disclosure for all government agencies across China. Over the last ten years, much attention has been paid to how much progress towards transparency can be and has been made in a political system long dogged by secrecy, with an enormous amount of ink spilled on this area of law. Yet one issue remains relatively untrodden, if not unknown, among scholars and observers interested in the Chinese transparency regime. That is transparency for public enterprises and institutions.

As part of the legacy from the planned economy of the pre-reform era, public enterprises and institutions, in Chinese 公共企事业单位, also known as state-owned enterprises and state-sponsored institutions, continue to perform a variety of public functions and/or to receive public funds. They still loom large in Chinese people’s lives today, spanning from health care to education, from transportation to electricity. Against this background, the level of transparency of these quasi or non-governmental organizations bears much significance and warrants more attention. In this paper I attempt to fill the gap in the existing literature.

It starts by explaining the legal framework of open public enterprises and institutions in China, paying particular attention to its difference from the same regarding administrative organs and empowered organizations under the OGI Regulations. The previously unnoted dualistic structure within China’s transparency law is pointed out and the 2019 amendment to the OGI Regulations to reinforce such a structure be introduced. I then explain the fourfold conventional wisdom that underpins such a legal change, as articulated by officials entrusted with the drafting task: First, it was believed that because public enterprises and institutions do not qualify as administrative subjects, they are usually unable to enter into administrative litigation. Even if they become defendants, it is difficult, if not impossible, for the courts to review the legality of their disclosure decisions. Second, it was suggested that the responsibility of ensuring public enterprises and institutions’ transparency, including settling grievances arising from lack thereof, is better entrusted to the oversight departments than to the judiciary.  Third, the drafters thought that public enterprises and institutions should be considered regulatees whose transparency obligations are different from the freedom of information requirements that apply more generally to the government, and closer to compulsory disclosure requirements imposed on listed companies or charitable organizations. The fourth and last official rationale is that globally, the freedom of information laws primarily target government agencies rather than non-government organizations.

The rest of the article dissects the above reasoning and puts forward counterarguments. It first reports and assesses the transparency performance of the Chinese public enterprises and institutions since the implementation of the OGI Regulations in 2008, particularly in comparison to that of the administrative organs. It will be made clear that public enterprises and institutions had a rather poor transparency record over the last decade or so, due to a lack of hierarchical pressure from the government departments responsible for overseeing their operation. In other words, although it became a legal requirement back in 2008 that public enterprises and institutions should be more open, there has remained a huge gap between the law on paper and law in action. In contrast, as a silver lining, this paper demonstrates that the Chinese judiciary has actually been active yet prudent in scrutinizing public enterprises and institutions’ compliance with the OGI Regulations, in spite of the institutional barrier created by the dualistic structure. The paper then argues that to incorporate public enterprises and institutions into the OGI Regulations is in line with both the Chinese constitutional imperative for participatory democracy and the international mainstream of including non-governmental entities performing public functions and/or receiving public funds in the freedom of information legislation. This means that the underlying rationale for enhancing the dualistic structure by the 2019 amendment is wrongheaded. The concluding part summarizes and makes proposals for further legal reforms in this area.

Chun Peng’s paper is published with the University of Pennsylvania Asian Law Review and available here.

Chun Peng is presently an assistant professor and assistant dean at Peking University Law School. He received his doctorate and master’s degree in law from the University of Oxford and holds a double degree in law and economics from Peking University. He has published widely on Chinese constitutional law, administrative law and comparative law in English and Chinese. Besides scholarly work, he writes op-eds on China and the world at The Diplomat, China Daily and Caixin. His book Rural Land Takings Law in Modern China: Origin and Evolution is published with Cambridge University Press. More recently, he is interested in data governance and privacy law and has published on China’s social credit system and the newly enacted PRC Personal Information Protection Law.

Lawyers and the Belt and Road Initiative

5. November 2021
A new paper by Lawrence J. Liu
Shanghai Pudong where many of the lawyers supporting the BRI go to work

I emerged from the taxi on a Sunday afternoon and peered up at the skyscrapers that dominate Beijing’s Guomao district. After finding the appropriate gaolou and taking the elevator up to the law firm’s upper floors, one of Mr. Wang’s* associates came out to greet me. Although the offices were largely empty, Mr. Wang’s corner was bustling with activity. Mr. Wang and I spoke for about half an hour before he asked if I would like to continue our conversation over lunch. I agreed, Mr. Wang grabbed a bottle of wine from his fridge, and we went out to eat.

During lunch, we continued our discussion of Mr. Wang’s cross-border legal experiences. He earned his initial degrees from Chinese universities before studying abroad and earning an additional set of European credentials. He returned to China to work at a domestic law firm, where he now specializes in representing Chinese mining companies pursuing projects in Africa. In addition to taking pride in his foreign training, in his foreign-language skills, and in the one foreign-born non-Chinese associate on his team, Mr. Wang is also very proud of China’s outbound development efforts. He criticized the negative portrayals of the Belt and Road Initiative (BRI) outside of China, noted that “Western” countries were hypocritical for celebrating their own international work while casting aspersions on China’s, and he applauded Chinese companies’ willingness to take risks that foreign companies no longer take.

Interest abounds in whether China’s outbound ambitions are changing the rules of the international legal order. Many have adopted an international-relations lens that focuses on state-to-state dynamics. This interest in the forest instead of the trees is not incorrect, but it shifts attention away from the sources of the norms that would underlie any potential new order—such as the Chinese lawyers who are intimately involved in the day-to-day work of initiatives like the BRI. Interviews with Mr. Wang and others reflect the complex role played by Chinese lawyers that sit at the boundary of two competing scripts. From one perspective, many are “Western”-trained and provide cross-border legal services developed and spread by “Western” states. From another, lawyers like Mr. Wang are encouraged by the Chinese government to serve on the frontlines of its international development efforts.

In previous work, I have emphasized the need for scholars to recognize variation within China’s legal profession and to examine the ways in which the state may rely on “state-adjacent” lawyers as citizen-partners in governance. “The Rules of the (Belt and) Road: How Lawyers Participate in China’s Outbound Investment and Infrastructure Initiatives” takes up these calls by focusing on another slice of the legal profession that is involved in state-led policy efforts: the 84 Chinese lawyers who have been identified by the All China Lawyers Association (ACLA) as “BRI and Cross-Border Legal Experts.” My research suggests that the BRI and Cross-Border Legal Expert is a highly educated male with extensive foreign experiences as well as strong ties to the state and the Chinese Communist Party.

To obtain a deeper understanding of these lawyers’ views and work, I also interviewed eleven experts or their associates in Beijing and Shanghai. I document how BRI and Cross-Border Legal Experts draw on knowledge buckets that highlight their familiarity with transnational best practices. At the same time, these Experts recognize and help shape the political context surrounding their work. Though most BRI and Cross-Border Legal Experts naturally became involved in BRI projects as their clients’ sights shifted abroad, many (like Mr. Wang) want to see the BRI succeed, even as they also recognize the need for continued policy reforms.

As China continues its global rise, will Chinese lawyers’ stance vis-à-vis the status quo become more subversive than complementary? Perhaps, though I would argue that it is still too early to say. Ongoing work should continue to monitor these dynamics by adopting a similar bottom-up approach. If and when China’s BRI lawyers begin to prioritize Chinese state scripts over existing norms of transnational practice, this should worry those who are committed to the “Western”-led international order. Until then, we should remain attentive to the words and actions of on-the-ground actors like China’s BRI and Cross-Border Legal Experts, those that make state policy a reality.

Find Lawrence Liu‘s paper here.

Lawrence J. Liu is a PhD student in the Jurisprudence and Social Policy Program at Berkeley Law as well as a JD candidate at Yale Law School. His research interests are in administrative law and regulatory politics, law and globalization, the legal profession, and state-society relations, with a focus on contemporary China.

* Mr. Wang is a pseudonym for one of my interviewees in Beijing.

A Pluralist Dispute Resolution Mechanism – A New Integrated DR System in China

13. October 2021
Opinion by Zhiqiong June Wang
Photo courtesy of Jimmy Sun

The world has witnessed significant developments in the institutions, mechanisms and processes of dispute resolution in China since the introduction of Open Up and Reform policies in 1978. Legal reforms since then have restored the court system and the legal profession. In commercial law, China’s WTO accession has further significantly facilitated the modernisation of legal institutions and the commercial law legal framework. With economic development and the strengthening of the legal system, there has also been significant growth in litigation, a development that does not sit comfortably with the traditional view in China that direct conflict should be averted and mediation or other non-confrontational means should be applied to resolve disputes. Additionally, under Xi’s leadership, China has begun to assert its own model of governance which has been presented to the world as a potential alternative global governance model.

At a practical level, ever increasing court caseloads in civil, commercial and administrative disputes have put major pressure on the court system and its resources. Indeed, according to a recent Supreme People’s Court Report, Chinese courts adjudicated some 28 million cases (of which more than half were civil and economic cases) in 2018. Not surprisingly, major reforms of dispute resolution mechanisms have been carried out in the last decade and continue until this day. In the last ten years or so, the dispute resolution system in China under Xi has been elevated to a mechanism treated as part of the new governance model, and its capacity as indicative of governance capacity.

The new system promoted by the Chinese government is described by Chinese authorities as a ‘Mechanism for Pluralist Dispute Resolution’ (PDR)(Duoyuanhua Jiufeng Jiejue Jizhi 多元化争端解决机制). The Chinese term ‘duoyuanhua’ has been variously translated as ‘multiple’ and ‘diversified’; however, in the book I co-authored with Prof Jianfu Chen, Dispute Resolution in the People’s Republic of China: The Evolving Institutions and Mechanisms, we decided after careful consideration that ‘pluralist’ is a better translation, since it indicates that the ‘duoyuanhua’ system is new and different, and the ‘multiple’ or ‘diversified’ dispute resolution methods it refers to are not just independent alternatives but interrelated components in an integrated and coordinated system.

The term ‘Mechanism for PDR’ first appeared in 2004 in the 2nd Five Year Reform Plan of the People’s Courts, and again in 2008 in the judicial reform scheme coordinated by the Communist Party of China (CPC) Central Committee on Judicial Reform. The most important policy measures, however, emerged in 2013 and 2014. The CPC Central Committee in 2014 stipulates that:

Mechanisms for prevention and resolution of social conflicts and disputes shall be strengthened, and a pluralist dispute resolution mechanism, in which mediation, arbitration, administrative ruling, administrative reconsideration, and litigation shall be organically linked and their operations be coordinated, shall be improved.

Item 5 (4), Decision Concerning Certain Major Issues in Comprehensively Moving Forward Ruling the Country According to Law, CPC Central Committee, 2014

This 2014 CPC Decision makes the reform task clear: to develop a comprehensive dispute resolution system in which the various dispute resolution methods are not treated as separate alternatives, but as mutually supportive components in an integrated system of PDR.

In Chinese literature and policy documents the term ‘Mechanism for PDR’ has been used in both a broad and narrow context.

The 2014 CPC Decision refers to strengthening mechanisms for the prevention and resolution of social conflicts and disputes and emphasises building and improving the interconnection and coordination of all kinds of dispute resolution methods. These measures include alternative dispute resolution (ADR), litigation and administrative measures and a great variety of organisations, including the judiciary (courts and procuratorates) and many government authorities such as administrative law enforcement agencies (public security authorities) and offices of Comprehensive Control and Social Management (Zongzhi Ban 综治办), as well as mass/social organisations (Trade Unions, Women’s Federations, Youth Leagues, Neighbourhood Committees). In this broad context, the term refers to a system of mechanisms for comprehensive social control and the prevention of social conflict and instability (Weiwen 维稳) under the general umbrella of social governance, which is clearly more political than legal. These reforms aim at establishing an integrated dispute resolution system that forms part of China’s new governance model, addressing not only dispute resolution but also the prevention of social conflict and maintenance of social stability.

Conversely, the term is also used in a narrow sense, referring to an integrated system of legal mechanisms, the reform of which is led by the Supreme People’s Court, which focuses on building links between ADR, administrative review, adjudication and litigation. These include judicial confirmation of mediation agreements, support for arbitration and the enforcement of arbitral awards, appointing mediators and arbitration institutions as court-sanctioned mediators and arbitrators, establishment of ‘one-stop’ (Yizhanshi 站式) dispute resolution mechanisms within the court system, and shared platforms for litigation and ADR.

The comprehensive approach, under the umbrella of strengthening PDR as a dispute resolution mechanism, is innovative yet full of uncertainties. It is probably well-intended that all social forces are mobilised to prevent and resolve social conflicts and disputes, and the one-stop approach may provide convenience and efficient and effective dispute resolution solutions.

It is uncertain and potentially risky, not just because the Mechanism for PDR may be used as an instrument for social control, but because this may politicise an otherwise innovative reform. On the other hand, however, efforts towards building and strengthening the PDR, in the narrow sense of the term, led by the Supreme People’s Court, are to be welcomed. These efforts have seen the strengthening and further development of mediation and arbitration, as well as the establishment of various mechanisms for ADR and litigation to work together as a ‘united force’ for dispute resolution.

Zhiqiong June Wang (PhD) is Associate Professor of Law, Western Sydney University, Australia. June’s research interests are in Chinese law, international economic law, dispute resolution and comparative law. Her China-related research focuses on original observation and analysis of the various institutional reforms in the area of commercial law in China. June is also an arbitrator of the Shenzhen International Court of Arbitration.

On this topic, June has co-authored with Professor Jianfu Chen the articleFrom Alternative Dispute Resolution to Pluralist Dispute Resolution: Towards an Integrated Dispute-Resolution Mechanism in China published by the International Journal of Law in Context (SSRN), and the book Dispute Resolution in the People’s Republic of China: The Evolving Institutions and Mechanisms, and Will the establishment of circuit tribunals break up the circular reforms in the Chinese judiciary? published by the Asian Journal of Comparative Law (SSRN).

Twitter @ZhiqiongJuneWang

Observing the Transformation of Chinese Law

28. September 2021
A new paper by Sida Liu
“Caged birds” by elizabethdonoghue is licensed under CC BY-NC-ND 2.0

How did Chinese law change in the first two decades of the 21st century? In his article Cage for the Birds: On the Social Transformation of Chinese Law, 1999-2019, Sida Liu flips the metaphor that Stanley B. Lubman used in his seminal book on Chinese law in the late 20th century, Bird in a Cage, to trace the Chinese legal system’s internal institutionalization and party inscription. Internal institutionalization refers to the vast improvement of the Chinese legal system’s internal coherence and formal rationality with the promulgation of thousands of new laws and regulations in the early 21st century. Party inscription refers to the Chinese Communist Party’s explicit reassertion of its dominance over the Chinese legal system since Xi Jinping took power in 2012, including incorporating the party disciplinary system into the National Supervision Commission, politicizing the judiciary and the bar exam, setting up party cells at law firms and nurturing legal professionals who are loyal to the party, and persecuting politically liberal lawyers and legal academics.

As a result of those two processes, Chinese law is no longer a chirping and stirring bird as it was in the 1990s, waiting to be freed from the political cage, but an increasingly large, complex, and repressive cage for the party-state to confine all kinds of birds. In this article, Liu identifies four types of birds currently trapped in the legal cage: hawks, crows, sparrows, and ostriches. Hawks are party and government officials who are potentially the subjects of efforts to combat corruption. Crows are activists who pose potential threats to political and social stability, including activist lawyers, feminists and LGBT (lesbian, gay, bisexual, transgender) activists, labor organizers, and religious activists. Sparrows are millions of netizens who form the “surrounding gaze” in China’s vibrant yet heavily censored cyberspace. Ostriches are ordinary Chinese people who usually turn a blind eye to politics and simply hope to live in peace and prosperity. Taken together, this typology of birds provides a view of Chinese law not with any doctrinal or institutional classification system but from the perspective of the various kinds of people living in it and influenced by it, as well as the ways in which the party-state uses law to control them.

To give a snapshot of how this new bird-cage metaphor works, with Xi Jinping’s massive anti-corruption campaign in the 2010s, laws for combating corruption in China have evolved from two parallel institutions of the CCP’s Commission for Discipline Inspection (CDI) and the anti-corruption bureau in the procuracy to the unified National Supervisory Commission. As a result, the extralegal shuanggui procedure, in which corrupt officials were taken by the CDI for questioning and prolonged detention, was legalized and the scope of the CDI’s work has expanded from CCP members to non-party members in the state sector. In other words, the invisible black box of shuanggui is not replaced but, rather, reinstalled in a harder and stronger legal box controlled by the CCP. All the “hawks”, corrupt or not, are confined to this legal box now.

In the rest of the article, the bird-cage metaphor is applied to other areas of Chinese law involving political stability, internet control, and everyday life. The article ends with a not-so-hopeful note. Liu argues that the idea of law as a driving force for economic and political change, which is implied in Lubman’s “bird in a cage” metaphor, is merely an illusion of law-and-development scholars and practitioners. For most of human history, the fate of law has always been a cage, especially when it is situated under an authoritarian state that prioritizes instrumentality over proceduralism and focuses on reducing “restlessness” rather than “arbitrariness”. However, the fate of the birds confined in the new Chinese legal cage remains uncertain.

Professor Sida Liu joined the Department of Sociology at the University of Toronto in 2016 and holds a non-budgetary cross-appointment at the Faculty of Law. His research interests include the sociology of law, organizations and professions, criminal justice, globalization, and social theory. He has conducted extensive empirical research on China’s legal reform and legal profession, including the globalization of corporate law firms, the political mobilization of criminal defense lawyers, the feminization of judges, and the career mobility of law practitioners. Professor Liu is the author of, among others, Criminal Defense in China: The Politics of Lawyers at Work (with Terence C. Halliday, Cambridge University Press, 2016).

The Cornerstones of China’s Fintech Regulation

17. September 2021
A new book by Robin Hui Huang
Mobile payment on a farmers’ market

Financial technology (Fintech) brings about paradigm changes to the traditional financial system, presenting both challenges and opportunities. In 2020 when this book was largely written, unlike many traditional businesses, Fintech seemed to be accelerated rather than hampered by the outbreak of the COVID-19 pandemic. Due to the various restrictions and even lockdowns imposed during the pandemic, more people and institutions have embraced Fintech, doing shopping, payment, and investment through online platforms. In any event, Fintech looks set to reshape the financial landscape, producing significant impact on the business community and society at large.

This is the first book-length treatment of the regulation of Fintech in China. At the international level, there has been a fierce competition for the coveted title of global Fintech hub. One of the key enablers of success in this race is regulation. As the world’s leader in Fintech, China’s regulatory experience is of both academic and practical significance. This book aims to present a systematic and contextualized account of China’s Fintech regulation, identify relevant institutional factors contributing to the development of the Chinese law, and illustrate why and how China’s Fintech regulation has been developed, if and how it differs from the rest of the world, and what can be learned from the Chinese experience.

Fintech is an evolving concept with new products or services emerging constantly. Hence, it seems neither desirable nor feasible to discuss all Fintech sectors in this book, and it would be necessary to be selective about the topics to be covered. This book chooses to focus on the following topics: online P2P lending, cryptoassets, initial coin offerings, mobile payments, data protection, robo-advisory, equity crowdfunding and central bank digital currency. In fact, China has both stories of success (e.g., mobile payments) and lessons of failure (e.g., online P2P lending).

Although different sectors of the Fintech market have different features and issues, this book shows some common threads running through them. First and foremost, the regulatory goal is to achieve two main objectives, namely facilitating financial innovation and market development on the one hand, while ensuring risk control and investor protection on the other. Second, the regulatory balance is a delicate and dynamic one, which needs to be carefully designed and adjusted according to the local conditions of any given jurisdiction. Third, the regulatory regime for the Fintech markets is a work-in-progress, which is not surprising given the fast-changing pace of the underlying Fintech markets.  

Given the novel and disruptive nature of Fintech, a fundamental question here is whether we can still use the traditional regulatory framework for Fintech, or we need to think outside the box and introduce a new one specifically for Fintech? Indeed, Fintech regulation presents a cutting-edge and largely uncharted territory, and the right key can be found only after lots of trial and error.

From a political-economic perspective, this book also ventures to demonstrate the Chinese characteristics of China’s Fintech regulation. For instance, it does not only examine the substantive rules, but also the enforcement issues, particularly the interest group politics of relevant regulators. At a higher level, China’s Fintech market can be labelled “policy market” in that the development and regulation of China’s Fintech markets have been heavily influenced by the policies of the government (or even the Chinese Communist Party). Data privacy and cybersecurity have become increasingly important in the regulation of China’s Fintech business, with far-reaching implications for the financial markets domestically and internationally (via overseas-listed Chinese Fintech firms). There can be more uncertainty arising from these issues due to China’s growing concerns over national security against the background of the ongoing competition (confrontation) between China and the US.

In sum, the Chinese experience can have important implications for the international discourse and debate on the regulation of Fintech. This book has several features which readers may find useful as a source of information. Firstly, a systematic and contextualized account of China’s Fintech regulation helps readers gain a holistic view of the regulatory approach and regulatory perimeter in China. Secondly, the book tries to identify and analyze factors the interaction of which has contributed to the constitution of the institutional environment in which China’s regulation of Fintech has been made and enforced. This will help readers understand not only what the law is, but also why the law is the way that it is. Thirdly, it takes a comparative approach to critically evaluate Fintech regulation in China. The comparative analysis covers some major Fintech jurisdictions in the region and internationally, such as the US, the UK, Singapore and Hong Kong.

Robin Hui Huang’s book, Fintech Regulation in China: Principles, Policies and Practices was published with Cambridge University Press and is available here.

Robin Hui Huang is Professor (senior level) at the Faculty of Law, Chinese University of Hong Kong. He is a leading expert in corporate and financial law with a focus on Chinese and comparative issues. He is also Adjunct Professor of Law at the University of New South Wales, Li Ka Shing Visiting Professor of Law at McGill University, Honorary Professor at East China University of Political Science and Law, and Guest Professor at China University of Political Science and Law. He is Specially-Invited Research Fellow of the Supreme People’s Court of PRC and Expert Advisor of Shanghai Financial Court. He has had about 120 publications, including 10 books and many papers in premier publishing houses and top journals in the United States, United Kingdom, Australia, Canada, Germany, Israel, Hong Kong, Mainland China, and elsewhere. He acts as a Chinese law expert in international litigations and serves as an arbitrator in China and overseas. 

Chinese Courts and Criminal Procedure – Q&A about the new book with editor Björn Ahl

8. September 2021

Chinese Courts and Criminal Procedure – Post 2013 Reforms was published this year with Cambridge University Press

The Xi’An Intermediate People’s Court
  1. In a nutshell: With its observations of a range of topics, what does this book tell us about the trajectory of criminal justice in China?

One of the main achievements of the book is to bring together contributions that look at Chinese court reforms and criminal procedure law reforms. Moreover, the book combines a wide range of analytical perspectives and themes in order to investigate questions that link institutional changes within the court system and legal environment with developments in criminal procedure law. The common denominator in the broad array of topics discussed in this volume is the multitude of forces attempting to influence the trajectory of judicial reform and criminal justice in China. The complex dynamics, and particular interests, of the numerous agents and subjects involved in the process intermingle with any undertaking to effective systemic change in the Chinese judiciary. These dynamics may play out in different ways. They may, for example, be mutually reinforcing, as in the case of the intra-court personnel reforms, heightened transparency, resilience against media influence and reform of the adjudication committees, all of which may result, to use the words of Fu Yulin, the author of chapter 2 of the book, in the by-product of a more independent judiciary. However, parallel reform projects can also interfere with one another, impeding the intended effects of each, as evidenced by the difficult position of the procuratorates in the criminal justice reforms, given that the envisioned trial-centred proceedings mandate the more prolific and active use of live witness testimony.

  1. Judicial Reform is an ongoing endeavour since reform and opening. (How) has the direction changed under the Xi Jinping administration?

Due to far-reaching limitations of civil and political rights, increased repression of political dissent and mass internment in Xinjiang, legal developments in the Xi Jinping era are generally perceived outside China as subject to unrestricted authoritarian rule that has largely side-lined legal institutions, including the Chinese courts. However, the court reforms of the post-2013 period have provided judges and courts with more autonomy in the adjudication of cases. Under Xi Jinping, court reforms have returned to the idea of rule-based governance, brought the court system back to the centre of dispute resolution, and emphasised professionalism, autonomous decision-making, the transparency and accountability of judges, and centralisation of the judiciary. The Decision on Governing the Country According to Law of the 4th Plenum, attempts at the normative regulation of inner-party affairs by strengthening rule-based governance and the October 2018 amendment of the People’s Court Organisation Law all underscore the regime’s efforts to formalise legal procedures and strengthen legality. Court reforms have taken a more radical turn than those passed under preceding administrations, as a vast range of measures have been introduced to render judges and the courts less susceptible to local government interference and increase the efficiency of the judiciary. The strengthening of the courts as professional, autonomous arbitrators of legal disputes was effected through both a centralised judicial authority and controlled experimental reform measures at the local level.    

  1. Xi Jinping’s leadership has amended the Constitution three years back, among others lifting the term limits for his own rule. Among the changes made, which are most consequential for criminal procedure in China?

Apart from abolishing the term limits of the state president, the 2018 constitutional amendment established the National Supervision Commission as a new state organ that merged the anti-corruption agencies of the party and the state. Supervision commissions were also introduced at the local levels. The National Supervision Commission has now been afforded an independent constitutional status that allows it to exercise both administrative and criminal supervisory powers in supervising, investigating, disciplining and sanctioning public officials. Rather than constituting an independent state institution, the supervision commissions have absorbed state functions that are now directly controlled by Party disciplinary inspection commissions at the various administrative levels, the members of which simultaneously hold positions in the state’s supervision commissions. The supervision commissions are not subject to the legal constraints on investigative powers stipulated in the Criminal Procedure Law, although they enjoy de facto power to conduct criminal investigations and gather evidence that is admissible in criminal trials. The Supervision Law’s coverage has been extended to all public employees who exercise public power rather than being restricted to Party members alone, as under the previous scope of investigation by the disciplinary inspection commissions. Meng Ye in chapter 5 of the book provides an in-depth analysis of the supervision commissions.

  1. The volume zooms in on a number of themes in the reform of criminal procedure. What do the observations have to offer in response to the claim that the rule of law is a lost cause in China?

The answer to this question depends on how you define the rule of law. If we take the term in its liberal sense and require that the law effectively constrains all levels of government and comprehensively controls the political process, then the overall direction of procedural and institutional reforms during the post-2013 era is disappointing. In general, the dominance of the party over the law has been re-emphasised on the ideological and institutional levels. It is stressed that the effectiveness of the law hinges on permanent affirmation and supervision by the party. The reforms do not directly aim at improving the protection of rights of the individuals involved in criminal procedures. However, improvements in terms of the protection of rights may occur as by-products of some reform measures. Many court reforms are part of a general centralisation dynamic and aim at insulating courts from improper horizontal influence of local actors, while strengthening vertical control over the court system. What this change from ‘improper influence’ to ‘proper influence’ means for the development of a ‘socialist rule of law’ is difficult to measure. The court and criminal procedure law reforms are oriented towards unified application of the law, they rely on technology and data-driven innovations that reduce human discretion, they have enhanced professionalisation, transparency and vertical control of courts as well as given individual judges and panels of judges greater autonomy in adjudication. However, criminal procedure reforms aim at enhancing Party-state governance effectively control crime and political dissent in order to maintain Party supremacy and social stability. To sum up, the reforms have strengthened the instrumentalist aspects of law and formal legality but not necessarily due process or human rights protection.

  1. How can the role of the Supreme People’s Court be described in criminal procedure developments?

This issue is addressed in detail by Susan Finder in her chapter on how the SPC adopts judicial interpretations of the criminal procedure law. The SPC is the most important institutional actor linking court reform and criminal procedure reform, with the dynamics of both grounded in the administrative and legislative functions of the SPC. Those functions are distinct characteristics of China’s highest court that are not shared by the apex courts of other jurisdictions. Although the SPC has an important adjudicative function as an appeal court, its legislative function has elevated it to the role of a legislator. The SPC wields these powers through judicial interpretations that are often more relevant to adjudicative practice in procedural law than the laws passed by the NPC or its Standing Committee. Further, the SPC exercises administrative powers over the entire court system, including the design and implementation of court reforms in cooperation with the relevant party organs. The SPC’s judicial interpretation drafting process is an example of secluded, bureaucratic law-making in which the political interests of the CPC and the institutional interests of the SPC and the judiciary as a whole dominate.

  1. What are other actors exerting influence in the development of criminal justice and courts in China? 

The book focuses on the Supreme People’s Court as a major actor of initiating and implementing institutional and procedural reforms. Yet we should not underestimate the role of the academia in the development of criminal procedure law and court reforms. Many of the reform measures were proposed by legal scholars and have been discussed for some time before they were taken up by the party-state leadership. Of course, legal scholars have no power to determine reform priorities or to take decisions about what kind of reform models shall be adopted, but Chinese legal scholarship is the most important intellectual resource from which decisionmakers draw.

  1. Developments in Chinese law have been informed by systems and laws in other countries. Does criminal procedure reform look to other countries for reference?

All major Chinese legal reforms in the last decades were preceded by comparative studies of legislation, scholarship and judicial practice of foreign jurisdictions. Apart from foreign jurisdictions, international human rights treaties that set standards for criminal trials have been a central reference point of academic discussions. However, nowadays debates about foreign legal models and their suitability for China only take place in the background. In contrast to earlier periods of the reform and opening period, official documents refrain from references to foreign or international law and place the indigenous Chinese experience at the centre. The widespread use of the terms ‘Chinese characteristics’ and ‘selective adaptation’ of foreign models indicate legal reform relies on indigenous resources and technology and data-driven innovations rather than on the adoption of ‘Western’ law. Indeed, Chinese legal institutions and procedural laws are quite distinct from those of liberal rule of law systems as the Chinese authoritarian system has certain features that determine the shape and operation of legal institutions and the law. For example, the supremacy of the Communist Party requires channels of ‘proper interference’ with judicial decision-making processes in order to effectuate its comprehensive overview of the implementation of law.     

Contributors to the volume ‘Chinese Courts and Criminal Procedure‘, published with Cambridge University Press, include Xiaohong Yu, Yulin Fu, Susan Finder, Ye Meng, Alexandra Kaiser, Zhiyuan Guo, Kwai Hang Ng, Xin He, Michelle Miao, and Daniel Sprick. The editor Björn Ahl is Professor and Chair of Chinese Legal Culture, Cologne University and President of the European China Law Studies Association.

China’s multinationals and their US lawyers

16. August 2021
A new paper by Ji Li

Chinese multinational companies (MNCs), key agents in China’s global expansion, have caught considerable attention as the US-China rivalry escalates. Top Chinese MNCs such as Huawei, ByteDance, and Xiaomi face unprecedented political, regulatory, and legal risks in the United States, which, if poorly managed, pose existential threat. Are Chinese MNCs capable of negotiating the risks? The answer is certainly no if the MNC managers, most of whom lack basic understanding of U.S. law, do not delegate extensively to legal professionals. In other words, U.S. lawyers play an indispensable role in helping Chinese MNCs navigate the increasingly complex and hostile U.S. legal and regulatory landscape. Yet little is known about how Chinese MNCs interact with their outside counsel, as the existing literature on corporate consumption of legal services has largely neglected developing country MNCs. Ji Li addresses Chinese MNCs’ in-house legal counsels in the United States in his article “Going Out” and Going In-House: Chinese Multinationals’ Internal Legal Capacity in the United States.  

Li empirically explores several major aspects of Chinese MNCs as consumers in the U.S. legal market. Do they take professional legal advice seriously? The qualitative evidence (i.e., interviews with lawyers, in-house counsel, and other business professionals) tells a mixed story. While some view Chinese MNCs as not notably different from U.S. companies, others complain about habitual disrespect for lawyers and under-appreciation of the importance of quality legal services for running business in the United States. However, the quantitative evidence (i.e., data based on a comprehensive survey of Chinese MNCs in the United States) indicates that, on balance, Chinese investors recognize U.S. legal services as being costly but essential for their U.S. operations.

That said, in a market of 1.3 million registered U.S. lawyers, most of whom are self-claimed “leading experts” in their respective practice areas, how do Chinese MNC managers without U.S. legal expertise collect accurate and truthful lawyer information? The study reveals that Chinese managers surmount severe information asymmetry by relying primarily on trusted and knowledgeable third parties for U.S. lawyer recommendations (for more about Chinese MNCs’ lawyer selection preferences, see “What Do Chinese Clients Want?”). Additionally, the study finds that most Chinese MNCs spend relatively insignificant amounts of money on U.S. legal services, leaving them with minimal bargaining power vis-à-vis their legal service providers. It is therefore not uncommon for top U.S. firms to treat Chinese MNCs as “second class clients.”  

Obviously, all Chinese MNCs are not the same, and their U.S. legal expenses vary significantly. Huawei and ByteDance probably spend millions of dollars a year purchasing U.S. legal services, whereas many report annual legal budgets of less than a hundred thousand dollars. What explains the inter-company variations? For instance, all else being equal, do state-owned Chinese MNC spend more on U.S. lawyers? After all, “it’s not their own money,” noted a knowledgeable informant. The study finds that the U.S. legal expenses of Chinese MNCs vary according to their legal service demand, not special corporate attributes such as ownership structure, which Li argues is another sign that Chinese MNCs have limited impact on the U.S. legal market due to their lack of leverage. The findings of this study contribute to ongoing debates about Chinese MNCs, their adaptation to host country institutions, and their impacts on the legal profession and the global legal service market. 

Ji Li’s paper “Meeting Law’s Demand: Chinese Multinationals as Consumers of U.S. Legal Services” was published in Yale Journal of International Law online and is available for free here.

Ji Li (jli[at]law.uci.edu) is John S. and Marilyn Long Professor of U.S.-China Business and Law at UC Irvine School of Law. His book, Clash of Capitalisms: Chinese Companies in the United States (Cambridge University Press, 2018), examines the adaptation of Chinese investors to the U.S. legal and regulatory system. His other publications can be downloaded here.