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Growing international commerce has made the recognition and enforcement of foreign arbitral awards and court judgments a critical component of cross-border dispute resolution in China. This article outlines the key procedural requirements for this process, examining both the legal framework and prevailing judicial practice.

Legal basis

The legal framework for recognising and enforcing foreign arbitral awards and court judgments in China is founded on three sources: international treaties, domestic legislation, and judicial interpretations.

The recognition and enforcement of foreign arbitral awards in China are handled by the courts, pursuant to relevant international treaties or the principle of reciprocity. A pivotal treaty in this regard is the 1958 Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York Convention), which China acceded to in 1986. With 172 member states, including China, the New York Convention provides a near-universally recognised regime for recognising and enforcing international arbitral awards.

Regarding the recognition and enforcement of foreign court judgments, China has not yet ratified any international conventions. Instead, the process relies primarily on bilateral judicial assistance treaties, or the principle of reciprocity.

Foreign arbitral awards

Under article 304 of the Civil Procedure Law, applications to recognise and enforce a foreign arbitral award must be submitted to the intermediate court where the respondent is domiciled, or where its assets are located. If neither is within China, the application may be filed with the intermediate court at the applicant¡¯s own domicile, or at a location with a pertinent connection to the dispute.

Article 4 of the New York Convention stipulates that an applicant must submit the following: (1) a duly authenticated original or copy of the arbitral award; (2) the original arbitration agreement, or a certified copy; and (3) certified translations if the above-mentioned documents are not in Chinese.

When reviewing a foreign arbitral award, a Chinese court conducts its examination primarily with reference to article V of the New York Convention. This article stipulates seven grounds on which recognition and enforcement may be refused, including: (1) a party¡¯s incapacity or an arbitration agreement¡¯s invalidity due to applicable laws; (2) a lack of proper notice to a party, or a party¡¯s inability to present their case; (3) the award dealing with matters beyond the scope of the submission; (4) improper composition of the arbitral tribunal or arbitral procedure; (5) the award not being binding, or having been set aside; (6) the subject matter not being capable of settlement by arbitration; and (7) a violation of public policy.

Of these, the first five grounds must be proven by the respondent, while the final two are examined by the court on its own initiative. Chinese courts interpret the public policy defence cautiously, typically reserving it for violations of fundamental legal principles, state sovereignty, public security or good morals ¨C scenarios that genuinely impact the public interest.

The time limit for applying to recognise and enforce a foreign arbitral award is two years. The rules governing the suspension and interruption of litigation time limits apply equally to this period. The clock starts from the final day of the performance period specified in the award. If no such period is stipulated, established judicial practice typically dictates that the timeframe begins on the day after the award is served on the parties.

Foreign court judgments

China¡¯s recognition and enforcement of foreign court judgments are predicated on bilateral judicial assistance treaties, or the principle of reciprocity. By the end of 2024, China had signed civil or commercial judicial assistance treaties with 39 countries.

An application to recognise and enforce a foreign court judgment must be submitted to the intermediate court where the respondent is domiciled, or where its assets are located. If the respondent has neither a domicile nor assets within China, jurisdiction falls to the intermediate court in the applicant¡¯s own domicile.

Pursuant to article 35 of the Minutes of the National Symposium on the Foreign-related Commercial and Maritime Trial Work of Courts, an applicant must submit: (1) a written application; (2) the original judgment or a certified copy; (3) the documentation proving the judgment is final and effective; (4) the documentation proving the absent party was lawfully summoned (for a default judgment); (5) Chinese translations bearing the official seal of a translation agency (if the original documents are in a foreign language); and (6) document notarisation or authentication (if the documents are formed outside China).

Under article 300 of the Civil Procedure Law, a Chinese court must refuse recognition and enforcement of a foreign court judgment if it finds any of the following: (1) the foreign court lacked jurisdiction; (2) the respondent was not lawfully summoned or given a reasonable opportunity to present its case; (3) the judgment was obtained by fraud; (4) a Chinese court has adjudicated the dispute, or China has recognised a judgment from a third country¡¯s court on the same matter; or (5) the judgment violates fundamental principles of Chinese law, or impairs national sovereignty, security or the public interest.

Similarly, a two-year limitation period applies to applications for recognising and enforcing foreign court judgments. The rules governing the suspension and interruption of litigation time limits also apply to this timeframe.

Principle of reciprocity

In the absence of an international treaty or bilateral agreement with the country where the ruling was made, applications for the recognition and enforcement of foreign arbitral awards or court judgments in China may be pursued under the principle of reciprocity.

In recognising and enforcing foreign judgments, China¡¯s judicial approach to reciprocity is evolving from a strict requirement of ¡°de facto reciprocity¡± towards incorporating ¡°legal reciprocity¡± and ¡°presumed reciprocity¡±. De facto reciprocity demands proof of a precedent where a foreign court has recognised and enforced a Chinese judgment. Legal reciprocity is satisfied if foreign law, in principle, allows for the enforcement of Chinese judgments. Presumed reciprocity is typically established through a mutual understanding or a diplomatic commitment between the two nations.

Sun Jiajia is a partner at W&H Law Firm. She can be contacted by phone at +86 139 1182 5033 or by e-mail at sunjiajia@weihenglaw.com
Ariel Gu is an associate at W&H Law Firm. She can be contacted by phone at +86 178 0136 9415 or by e-mail at gujiarui@weihenglaw.com