New China International Economic and Trade Arbitration Commission Arbitration Rules Issued
This article looks at the new CIETAC rules that have been issued in part, to deal with the restructuring of its Shanghai commission.
On January 1, 2015, the new China International Economic and Trade Arbitration Commission (CIETAC) rules, which is published in December 2014, came into effect. It released its Announcement that the Shanghai and Shenzhen sub-commissions are referred to as the “Shanghai Office, Arbitration Court of CIETAC” and the“South China Office, Arbitration Court of CIETAC” respectively and provides the contact details of the Shanghai and Shenzhen sub-commissions.
This is the latest development of the dispute, which began in April 2012, between CIETAC, the Shanghai Sub-Commission of CIETAC (CIETAC Shanghai), and the Shenzhen Court of International Arbitration (SCIA) (the CIETAC Dispute). SCIA was known as the South China Sub-Commission of CIETAC before 22 October 2012.
The CIETAC Dispute
The CIETAC Dispute began since 24 April 2012 when CIETAC announced that CCPIT had amended and published the 2012 Rules, which came into effect on 1 May 2012. On 30 April 2012, CIETAC Shanghai claimed independence from CIETAC, and abruptly released its own arbitration rules. The rules came into effect at the same time as the 2012 rules. The SCIA followed CIETAC Shanghai, refusing to adopt the 2012 Rules, which made the CIETAC Dispute escalated.
On 1 August 2012, CIETAC announced that, from 1 August 2012, the authority of CIETAC Shanghai and SCIA to accept and administer arbitration cases was to be suspended. Furthermore, from 1 August 2012, parties that had agreed to arbitration by one of the two sub-commissions were required to submit their disputes to CIETAC instead of to the relevant sub-commission.
In response to CIETAC's above announcement, CIETAC Shanghai and SCIA announcement on 4 August 2012 jointly, that CIETAC Shanghai and SCIA had been independent arbitration entities since their establishment, and they would continue to accept and hear cases that submitted to them. The SCIA declared in November 2012 that it had changed its name to the South China International Economic and Trade Arbitration Commission from 22 October 2012, and that it would also use the name of Shenzhen Court of International Arbitration concurrently. SCIA also announced that the South China International Economic and Trade Arbitration Commission Arbitration Rules had been approved by the Council of SCIA and the new rules and a new panel of arbitrators would be in place from 1 December 2012.
The outcome of the CIETAC Dispute
The Latest Announcement which took into effect on January 1, 2015 ends the CIETAC Dispute which has been unresolved for more than two years. Shanghai International Economic and Trade Arbitration Commission (SHIAC) and SCIA are independent from the CIETAC finally.
Although the CIETAC Dispute has been resolved, we recommend that parties who wish to submit disputes to CIETAC for arbitration should expressly refer to CIETAC (to avoid doubt, specifically 'CIETAC in Beijing') and to the 2012 Rules in the dispute resolution clause. Parties who choose to arbitrate in Shanghai could opt for SHIAC. The clause should state SHIAC’s full name (“Shanghai International Arbitration Commission”) to avoid confusion or uncertainty. Parties who wish to arbitrate before CIETAC’s Shanghai sub-commission should refer to “CIETAC Shanghai Sub-commission as reorganized by CIETAC as of 31 December 2014”, or wording to that effect, to avoid potential disputes.
ABOUT THE AUTHOR: Han Yuanyuan
Han Yuanyuan is an Associate in the MMLC Group.
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Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.