Arbitration Law of the Peoples Republic of China

 Chapter I General Provisions

Article 1
  This Law is formulated in order to ensure that economic disputes shall
be impartially and promptly arbitrated, to protect the legitimate rights
and interests of the relevant parties and to guarantee the healthy
development of the socialist market economy.
Article 2
   Disputes over contracts and disputes over property rights and
interests between citizens, legal persons and other organizations as equal
subjects of law may be submitted to arbitration.
Article 3
  The following disputes shall not be submitted to arbitration:
  1. disputes over marriage, adoption, guardianship,
  child maintenance and inheritance; and
  2. administrative disputes falling within the jurisdiction
  of the relevant administrative organs according to
  law.
Article 4
  The parties adopting arbitration for dispute settlement shall reach an
arbitration agreement on a mutually voluntary basis. An arbitration
commission shall not accept an application for arbitration submitted by
one of the parties in the absence of an arbitration agreement.
Article 5
  A people's court shall not accept an action initiated by one of the
parties if the parties have concluded an arbitration agreement, unless the
arbitration agreement is invalid.
Article 6
  An arbitration commission shall be selected by the parties by
agreement.
  The jurisdiction by level system and the district jurisdiction system
shall not apply in arbitration.
Article 7
  Disputes shall be fairly and reasonably settled by arbitration on the
basis of facts and in accordance with the relevant provisions of law.
Article 8
  Arbitration shall be conducted in accordance with the law, independent
of any intervention by administrative organs, social organizations or
individuals.
Article 9
  The single ruling system shall be applied in arbitration. The
arbitration commission shall not accept any application for arbitration,
nor shall a people's court accept any action submitted by the party in
respect of the same dispute after an arbitration award has already been
given in relation to that matter.
  If the arbitration award is canceled or its enforcement has been
disallowed by a people's court in accordance with the law, the parties
may, in accordance with a new arbitration agreement between them in
respect of the dispute,  re-apply for arbitration or initiate legal
proceedings with the people's court.

 Chapter II Arbitration Commissions and Arbitration Association

Article 10
  Arbitration commissions may be established in the municipalities
directly under the Central Government, in the municipalities where the
people's governments of provinces and autonomous regions are located or,
if necessary, in other cities divided into districts.  Arbitration
commissions shall not be established at each level of the administrative
divisions.
  The people's governments of the municipalities and cities specified in
the above paragraph shall organize the relevant departments and the
Chamber of Commerce for the formation of an arbitration commission.
  The establishment of an arbitration commission shall be registered
with the judicial administrative department of the relevant province,
autonomous region or municipalities directly under the Central Government.
Article 11
  An arbitration commission shall fulfil the following conditions:
  1. it must have its own name, domicile and Articles of Association;
  2. it must possess the necessary property;
  3. it must have its own members; and
  4. it must have arbitrators for appointment.
  The articles of association of the an arbitration commission shall be
formulated in accordance with this Law.
Article 12
  An arbitration commission shall comprise a chairman, two to four
vice-chairmen and seven to eleven members.
  The chairman, vice-chairmen and members of an arbitration commission
must be persons specialized in law, economic and trade and persons who
have actual working experience. The number of specialists in law, economic
and trade shall not be less than two-thirds of the members of an
arbitration association.
Article 13
  The arbitration commission shall appoint fair and honest person as its
arbitrators.
  Arbitrators must fulfil one of the following conditions:
  1. they have been engaged in arbitration work for at least eight
years;
  2. they have worked as a lawyer for at least eight years;
  3. they have been a judge for at least eight years;
  4. they are engaged in legal research or legal teaching and in senior
positions; and
  5. they have legal knowledge and are engaged in professional work
relating to economics and trade, and in senior positions or of the
equivalent professional level.
  The arbitration commission shall establish a list of arbitrators
according to different professionals.

Article 14
  Arbitration commissions are independent of administrative organs and
there are no subordinate relations with any administrative organs nor
between the different arbitration commissions.
Article 15
  The China Arbitration Association is a social organization with the
status of a legal person. Arbitration commissions are members of the China
Arbitration Association. The Articles of Association of the  China
Arbitration Association shall be formulated by the national general
meeting of the members.
  The China Arbitration Association is an organization in charge of
self-regulation of the arbitration commissions.  It  shall  conduct
supervision over the conduct (any breach of discipline) of the arbitration
commissions and their members and arbitrators in accordance with its
articles of association.
  The China Arbitration Association shall formulate Arbitration Rules in
accordance with this Law and the Civil Procedure Law.

 Chapter III Arbitration Agreement

Article 16
   An arbitration agreement shall include the arbitration clauses
provided in the contract and any other written form of agreement concluded
before or after the disputes providing for submission to arbitration.
  The following contents shall be included in an arbitration agreement:
  1. the expression of the parties' wish to submit to arbitration;
  2. the matters to be arbitrated; and
  3. the Arbitration Commission selected by the parties.
Article 17
  An arbitration agreement shall be invalid under any of the following
circumstances:
  1. matters agreed upon for arbitration are beyond the scope of
arbitration prescribed by law;
  2. an arbitration agreement concluded by persons without or with
limited capacity for civil acts; and
  3. one party forces the other party to sign an arbitration agreement
by means of duress.
Article 18
  If the arbitration matters or the arbitration commission are not
agreed upon by the parties in the arbitration agreement, or, if the
relevant provisions are not clear, the parties may supplement the
agreement. If the parties fail to agree upon the supplementary agreement,
the arbitration agreement shall be invalid.
Article 19
  An arbitration agreement shall exist independently. Any changes to,
rescission, termination or invalidity of the contract shall not affect the
validity of the arbitration agreement.
  An arbitration tribunal has the right to rule on the validity of a
contract.
Article 20
  If the parties object to the validity of the arbitration agreement,
they may apply to the arbitration commission for a decision or to a
people's court for a ruling. If one of the parties submits to the
arbitration commission for a decision, but the other party applies to a
people's court for a ruling, the people's court shall give the ruling.
  If the parties contest the validity of the arbitration agreement, the
objection shall be made before the start of the first hearing of the
arbitration tribunal.

 Chapter IV Arbitration Procedure

 Section 1: Application and Acceptance for Arbitration

Article 21
  The parties applying for arbitration shall fulfil the following
conditions:
  1. they must have an arbitration agreement;
  2. they must have a specific claim with facts and argument on which
the claim is based; and
  3. the arbitration must be within the jurisdiction of the arbitration
commission.
Article 22
  The party applying for arbitration shall submit to an arbitration
commission the arbitration agreement, an application for arbitration and
copies thereof.
Article 23
  An arbitration application shall state clearly the following:
  1. the name, sex, age, occupation, work unit and address of the party,
the name address and legal representative of the legal person or other
organization and the name and position of its person-in charge;
  2. the arbitration claim and the facts and argument on which the claim
is based; and
  3. evidence and the source of evidence, the name and address of the
witness (es).
Article 24
  Within 5 days from the date of receiving the arbitration application,
the arbitration commission shall notify the parties that it considers the
conditions for acceptance have been fulfilled, and that the application is
accepted by it. If the arbitration commission considers that  the
conditions have not been fulfilled, it shall notify the parties in writing
of its rejection, stating its reasons.
Article 25
  Upon acceptance of an arbitration application,  the arbitration
commission shall, within the time limit provided by the Arbitration Rules,
serve a copy of the Arbitration Rules and the list of arbitrators on the
applicant,  and serve a copy of the arbitration application,  the
Arbitration Rules and the list of arbitrators on the respondent.
  Upon receipt of a copy of the arbitration application, the respondent
shall, within the time limit prescribed by the Arbitration Rules, submit
its defence to the arbitration commission. Upon receipt of the defence,
the arbitration commission shall, within the time limit prescribed by the
Arbitration Rules, serve a copy of the reply on the applicant. The failure
of the respondent to submit a defence shall not affect the proceeding of
the arbitration procedures.

Article 26
  Where the parties had agreed on an arbitration agreement, but one of
the parties initiates an action before a people's court without stating
the existence of the arbitration agreement, the people's court shall,
unless the arbitration agreement is invalid, reject the action if the
other party submits to the court the arbitration agreement before the
first hearing of the case. If the other party fails to object to the
hearing by the people's court before the first hearing, the arbitration
agreement shall be considered to have been waived by the party and the
people's court shall proceed with the hearing.
Article 27
  The applicant may abandon or alter his arbitration claim. The
respondent may accept the arbitration claim or object to it. It has a
right to make a counterclaim.
Article 28
  A party may apply for property preservation if, as the result of an
act of the other party or for some other reasons, it appears that an award
may be impossible or difficult to enforce.
  If one of the parties applies for property preservation,  the
arbitration commission shall submit to a people's court the application of
the party in accordance with the relevant provisions of the Civil
Procedure Law.
  If a property preservation order is unfounded, the applicant shall
compensate the party against whom the order was made for any losses
sustained as a result of the implementation of the property preservation
order.
Article 29
  The parties and their legal representatives may appoint lawyers or
engage agents to handle matters relating to the arbitration. In the event
that a lawyer or an agent is appointed to handle the arbitration matters,
a letter of authorization shall be submitted to  the  arbitration
commission.


 Section 2: Composition of the Arbitration Tribunal

Article 30
   An arbitration tribunal may comprise three arbitrators or one
arbitrator. If an arbitration tribunal comprises three arbitrators, a
presiding arbitrator shall be appointed.
Article 31
  If the parties agree to form an arbitration tribunal comprising three
arbitrators, each party shall select or authorize the chairmen of the
arbitration commission to appoint one arbitrator. The third arbitrator
shall be selected jointly by the parties or be nominated by the chairman
of the arbitration commission in accordance with a joint mandate given by
the parties. The third arbitrator shall be the presiding arbitrator.
  If the parties agree to have one arbitrator to form an arbitration
tribunal, the arbitrator shall be selected jointly by the parties or be
nominated by the chairman of the arbitration commission in accordance with
a joint mandate given by the parties.

Article 32
  If the parties fail, within the time limit prescribed by the
Arbitration Rules, to select the form of the constitution of the
arbitration tribunal or fail to select the arbitrators, the arbitrators
shall be appointed by the chairman of the arbitration commission.
Article 33
  After the arbitration tribunal is constituted,  the arbitration
commission shall notify the parties in writing of the composition of the
arbitration tribunal.
Article 34
  In any of the following circumstances, an arbitrator must withdraw
from the arbitration, and the parties shall have the right to apply for
his withdrawal if he:
  1. is a party or a close relative of a party or of a party's
representative;
  2. is related in the case;
  3. has some other relationship with a party to the case or with a
party's agent which could possibly affect the impartiality of the
arbitration;
  4. meets a party or his agent in private, accepts an invitation for
dinner by a party or his representative or accepts gifts presented by any
of them.
Article 35
  When applying for the withdrawal of an arbitrator, the petitioning
party shall state his reasons and submit a withdrawal application before
the first hearing. A withdrawal application may also be submitted before
the conclusion of the last hearing if reasons for the withdrawal only
became known after the start of the first hearing.
Article 36
  Whether an arbitrator is withdrawn or not shall be determined by the
chairman of the arbitration commission. If chairman is serving as an
arbitrator, the withdrawal or not shall be determined collectively by the
arbitration commission.
Article 37
  If an arbitrator is unable to perform his duties as an arbitrator as a
result of the withdrawal or any other reasons, another arbitrator shall be
selected or appointed in accordance with the provisions of this Law.
  After a replaced arbitrator has been selected or appointed following
the withdrawal of an arbitrator, the parties may apply to resume the
arbitration procedure. The arbitration tribunal shall determine whether
the resumption of the procedure may be allowed. The arbitration tribunal
may determine on its own whether the arbitration procedure shall be
resumed.

Article 38
  An arbitrator involved in one of the circumstances described in Item
4, Article 34, if it is serious, or those described in Item 6, Article
58, such arbitrator shall be legally liable in accordance with the law.
The arbitration commission shall remove his name from the list of
arbitrators.

 Section 3: Hearing and Arbitral Awards

Article 39
  An arbitration tribunal shall hold a tribunal session to hear an
arbitration case. If the parties agree not to hold a hearing, the
arbitration tribunal may render an award in accordance  with  the
arbitration application, the defence statement and other documents.
Article 40
  An arbitration shall not be conducted in public. If the parties agree
to a public hearing, the arbitration may proceed in public, except those
concerning state secrets.
Article 41
  The arbitration commission shall notify the two parties within the
time limit provided by the Arbitration Rules of the date of the hearing.
Either party may request to postpone the hearing with in the time limit
provided by the Arbitration Rules if there is a genuine reason. The
arbitration tribunal shall decide whether to postpone the hearing.
Article 42
  If the applicant for arbitration who has been given a notice in
writing does not appear before the tribunal without good reasons, or
leaves the tribunal room during a hearing without the permission of the
arbitration tribunal, such applicant shall be deemed as having withdrawn
his application.
  If the party against whom the application was made was served with a
notice in writing but does not appear before the tribunal without due
reasons or leaves the tribunal room during a hearing without the
permission of the arbitration tribunal, an award by default may be given.
Article 43
  The parties shall produce evidence in support of their claims.
  An arbitration tribunal may collect on its own evidence it considers
necessary.
Article 44
  For specialized matters, an arbitration tribunal may submit for
appraisal to an appraisal organ agreed upon by the parties or to the
appraisal organ appointed by the arbitration tribunal if it deems such
appraisal to be necessary.
  According to the claim of the parties or the request of the
arbitration tribunal, the appraisal organ shall appoint an appraiser to
participate in the hearing. Upon the permission of the arbitration
tribunal, the parties may question the appraiser.

Article 45
  Any evidence shall be produced at the start of the hearing. The
parties may challenge the validity of such evidence.
Article 46
  In the event that the evidence might be destroyed or if it would be
difficult to obtain the evidence later on, the parties may apply for the
evidence to be preserved. If the parties apply for such preservation, the
arbitration commission shall submit the application to the basic-level
people's court of the place where the evidence is located.
Article 47
  The parties have the right to argue during an arbitration procedure.
At the end of the debate, the presiding arbitrator or the sole arbitrator
shall ask for the final opinion of the parties.
Article 48
  An arbitration tribunal shall make a written record of the hearing. If
the parties or other participants to the arbitration consider that the
record has omitted a part of their statement or is incorrect in some other
respect, they shall have the right to request correction thereof. If no
correction is made, the request for correction shall be noted in the
written record.
  The arbitrators, recorder, parties and other participants to the
arbitration shall sign or affix their seals to the record.
Article 49
  After the submission of an arbitration application, the parties may
settle the dispute among themselves  through  conciliation.  If  a
conciliation agreement has been reached, the parties may apply to the
arbitration tribunal for an award based on the conciliation agreement.
Then may also withdraw the arbitration application.
Article 50
  If the parties fall back on their words after the conclusion of a
conciliation agreement and the withdrawal of the arbitration application,
application may be made for arbitration in accordance with the arbitration
agreement.
Article 51
  Before giving an award, an arbitration tribunal may first attempt to
conciliate. If the parties apply for conciliation voluntarily, the
arbitration tribunal shall conciliate. If conciliation is unsuccessful, an
award shall be made promptly.
   When a settlement agreement is reached by conciliation,  the
arbitration tribunal shall prepare the conciliation statement or the award
on the basis of the results of the settlement agreement. A conciliation
statement shall have the same legal force as that of an award.

Article 52
  A conciliation statement shall set forth the arbitration claims and
the results of the agreement between the parties. The conciliation
statement shall be signed by the arbitrators, sealed by the arbitration
commission, and served on both parties.
  A conciliation statement shall have legal effect once signed and
accepted by the parties.
  If the parties fall back on their words before the conciliation
statement is singed and accepted by them, an award shall be made by the
arbitration tribunal promptly.
Article 53
  An award shall be based on the opinion of the majority arbitrators.
The opinion of the minority arbitrators shall be recorded in writing. If
an opinion of the minority arbitrators shall be recorded in writing. If an
opinion of the majority arbitrators can not be constituted at the
tribunal, the award shall be given according to the opinion of the
presiding arbitrator.
Article 54
  The arbitration claims, the matters in dispute, the grounds upon which
an award is given, the results of the judgement, the responsibility for
the arbitration fees and the date of the award shall be set forth in the
award. If the parties agree not to include in the award the matters in
dispute and the grounds on which the award is based, such matters may not
be stated in the award. The award shall be signed by the arbitrators and
sealed by the arbitration commission. The arbitrator who disagrees with
the award may select to sign or not to sign it.
Article 55
  During the course of arbitration by an arbitration tribunal, where a
part of facts has been made clear, a partial award may first be given in
relation to that part.
Article 56
  The parties may, within 30 days of the receipt of the award, request
the arbitration tribunal to correct any typographical errors, calculation
errors or matters which had been awarded but omitted in the award.
Article 57
  An award shall be legally effective on the date it is given.

 Chapter V Application for Cancellation of an Award

Article 58
  The parties may apply to the intermediate people's court at the place
where the arbitration commission is located for cancellation of an award
if they provide evidence proving that the award involves one of the
following circumstances:
  1. there is no arbitration agreement between the parties;
  2. the matters of the award are beyond the extent of the arbitration
agreement or not within the jurisdiction of the arbitration commission;
  3. the composition of the arbitration tribunal or the arbitration
procedure is in contrary to the legal procedure;
  4. the evidence on which the award is based is falsified;
  5. the other party has concealed evidence which is sufficient to
affect the impartiality of the award; and
  6. the arbitrator(s) has (have) demanded or accepted bribes, committed
graft or perverted the law in making the arbitral award.
  The peoples' court shall rule to cancel the award if the existence of
one of the circumstances prescribed in the preceding clause is confirmed
by its collegiate bench.
  The people's court shall rule to cancel the award if it holds that the
award is contrary to the social and public interests.
Article 59
  If a party applies for cancellation of an award, an application shall
be submitted within 6 months after receipt of the award.
Article 60
  The people's court shall, within 2 months after receipt of the
application for cancellation of an award, render its decision for
cancellation of the award or for rejection of the application.
Article 61
  If the people's court holds that the case may be re-arbitrated by the
arbitration tribunal after receipt of the application for cancellation of
an award, the court shall  inform  the  arbitration  tribunal  of
re-arbitrating the case within a certain period of time and rule to
suspend the cancellation procedure. If the arbitration tribunal refuses to
re-arbitrate, the people's court shall rule to resume the cancellation
procedure.


 Chapter VI Enforcement

Article 62
  The parties shall execute an arbitration award. If one party fails to
execute the award, the other party may apply to a people's court for
enforcement in accordance with the relevant provisions of the Civil
Procedure Law, and the court shall enforce the award.
Article 63
  A people's court shall, after examination and verification by its
collegiate bench, rule not to enforce an award if the party against whom
an application for enforcement is made provides evidence proving that the
award involves one of the circumstances prescribed in Clause 2, Article
217 of the Civil procedure Law.
Article 64
  If one party applies for enforcement of an award while the other party
applies for cancellation of the award, the people's court receiving such
application shall rule to suspend enforcement of the award.
  If a people's court rules to cancel an award, it shall rule to
terminate enforcement. If the people's court overrules the application for
cancellation of an award, it shall rule to resume enforcement.

 Chapter VII Special provisions on Foreign-Related Arbitration

Article 65
  The provisions of this Chapter shall apply to all arbitration of
disputes arising from foreign economic, trade, transportation or maritime
matters. In the absence of provisions in this Chapter, other relevant
provisions of this Law shall apply.
Article 66
  A foreign arbitration commission may be organized and established by
the China International Chamber of Commerce.
  A foreign arbitration commission shall comprise one chairman, several
vice-chairmen and several committee members.
  The chairman, vice-chairmen and committee members may be appointed by
the China International Chamber of Commerce.
Article 67
   A foreign arbitration commission may appoint  foreigners  with
professional knowledge in such fields as law, economic and trade, science
and technology as arbitrators.
Article 68
  If the parties to a foreign-related arbitration apply for evidence
preservation, the foreign arbitration commission shall submit their
applications to the intermediate people's court in the place where the
evidence is located.
Article 69
  The arbitration tribunal of a foreign arbitration commission may
record the details of the hearing in writing or record the essentials of
the hearing in writing. The written record of the essentials shall be
signed or sealed by the parties and other participants in the arbitration.
Article 70
  A people's court shall, after examination and verification by its
collegiate bench, rule to cancel an award if a party to the case provides
evidence proving that the arbitration award involves one  of  the
circumstances prescribed in Clause 1, Article 260 of the Civil Procedure
Law.
Article 71
  A people's court shall, after examination and verification by its
collegiate bench, rule not to enforce an award-if the party against whom
an application is made provides evidence proving that the arbitration
award involves one of the circumstances prescribed in Clause 1,  Article
260 of the Civil Procedure Law.
Article 72
  Where the party subject to enforcement or its property is not within
the territory of the People's Republic of China, a party applying for the
enforcement of a legally effective arbitration award shall apply directly
to the foreign court having jurisdiction for recognition and enforcement
of the award.

Article 73
  Foreign arbitration rules may be formulated by the China International
Chamber of Commerce in accordance with this Law and the relevant
provisions of the Civil Procedure Law.


 Chapter VIII Supplementary Provisions

Article 74
  If the law has stipulated a time limitation of arbitration, such
provisions of the law shall apply. If the law has not stipulated a time
limitation of arbitration, the provisions on the limitation of actions
shall apply.
Article 75
  The arbitration Commission may formulate provisional arbitration rules
in accordance with this Law and the relevant provisions of the Civil
Procedure Law before the formulation of the arbitration rules by the China
Arbitration Association.
Article 76
  The parties shall pay arbitration fees in accordance with the relevant
provisions.
  The methods for the collection of arbitration fees shall be submitted
to the commodity prices administration department for approval.
Article 77
   Arbitration of labor disputes and disputes over contracts for
undertaking agricultural projects within agricultural collective economic
organizations shall be separately stipulated.
Article 78
  In the event of conflict between the provisions on arbitration
formulated before the coming into effect of this Law and the provisions of
this Law, the provisions of this Law shall prevail.
Article 79
  Arbitration organs established before the coming into effect of this
Law in the municipalities directly under the Central Government, in the
municipalities where the people's governments of the provinces  or
autonomous regions and in other cities divided into districts must be
re-organized in accordance with the relevant provisions of this Law. The
arbitration organs which are not re-organized shall be terminated at the
expiration of one year after the date of effectiveness of this Law.
  All other arbitration organs established before the implementation of
this Law and not conforming to the provisions of this Law shall be
terminated on the date of effectiveness of this Law.
Article 80
  This Law shall be effective as of September 1, 1995.