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What You Should Know About China Litigation.

By Dan Harris on Posted in Legal News

The China Law Insight Blog has a very thoughtful post entitled, “Evidence Collection and Alternatives to “Discovery” in P.R.C. Litigation.” The post does an excellent job explaining the lack of pretrial discovery in China court cases and why American companies and lawyers tend to be so ill-prepared for this. To grossly summarize and oversimplify the article, foreign (especially American) companies need to know the following three things about litigating in China:

  1. Once a case begins in a Chinese court, things move fast. Very fast. Within a month or so of filing a case the court will issue a notice of the evidence production period and that period is usually 30 days. This means you will need to provide the opposing party and the court with enough evidence to win the case and that evidence must be translated into Chinese. 
  2. Chinese courts strongly favor documentary evidence over other kinds of evidence, including live testimony. 
  3. Chinese courts do not have discovery as we know it in the United States.

I am going to add one non-procedural item to the list of things that Americans should know about Chinese courts and that is that the courts tend to look much more at the equities of a case (as opposed to the law) than do American courts.

All of the above mean that American companies involved in litigation in China must engage in the following strategies so as to increase their chances of prevailing;

  1. If you are going to pursue litigation in China (or if you are sued in China), you need to gather up your evidence and have it translated as quickly as possible.
  2. Your case is likely going to rise or fall on the strength of your documentary evidence and if you do not have strong documentary evidence you probably should not bring the case. And as I discussed in the post, “China Contracts. Email Not Usually Included,” Chinese courts in determining the terms of a contract typically stay within the four corners of a signed document and tend to give little credence to email or oral “understandings.”
  3. You should not count on being able to get evidence from your opposing party.
  4. Think about the equities of your case, not just the law. Ask what is fair and what would be good for China.  

If you want to read more about litigating against Chinese companies (in China or elsewhere), check out the following:

What do you think?

  • tracy

    I have been involved in two litigation matters in China and this post really does capture what it is like. It is so different from the United States where there are pauses of months and where everything before trial seems to focus on getting evidence for trial. The first time we had a case in China, I hated it because I felt as though we were moving to slow for it, but by my second time, I actually had come to like it. China litigation moves very fast, but that does also mean it costs a lot less.

  • Twofish

    One thing to remember is that this very much “law dependent.” For example with contract cases, the courts will try to find a solution that is fair and considers good faith in the parties because that is what the law says that they should be (Articles 5 and 6 of the contract law).
    If you are suing a local government, the rules are different, and there is no legal requirement that the court look at fairness or that the parties act in good faith.
    One other thing about Chinese courts is that they look very careful at the clock. The relevant procedure laws all have deadlines, which the courts look at pretty closely.

  • BPO

    The main thing we have to remember that in China litigation law is There is no single law or regulation that specifically governs international civil litigation in China. Foreign companies doing business in China are commonly concerned about the ability of the Chinese judicial system to protect their legitimate business interests. To many foreigners, the Chinese People’s Courts are mysterious, particularly when dealing with international civil litigation, despite the fact that China has been opening up to the outside world for more than twenty years. Hope further judicial reform will help attract international business in the years to come. thanks for sharing.