Litigation: China

1. Describe the general organisation of the court system for civil litigation.

China

Unlike other countries, China does not have a federal and state court system. However, there are specialised people’s courts that handle specific types of civil disputes such as intellectual property and maritime cases.

Judges' selection in China is highly regulated, requiring specific qualifications and extensive training before appointment. China is not a case law country, and people's courts are not bound by earlier decisions or decisions from other people’s courts.

China's civil court system does not use juries; professional judges make decisions based on the law and the facts of each case.

2. Give an overview of basic procedural principles that govern civil litigation in your jurisdiction.

China

Civil litigation in China is governed by four general principles: the principle of equality of the parties to the proceedings; the principle of legally prescribed procedure; the principle of argument; and the principle of disposition.

• The principle of equality of the parties to the proceedings. Parties in civil lawsuits have equal rights under the law, and people’s courts strive to ensure and facilitate these rights while applying the law equally to all parties.
• The principle of legally prescribed procedure. Civil litigation in China must follow the procedures set forth under the Civil Procedure Law of the People’s Republic of China (Amended in 2021) and other relevant regulations. Non-compliance may lead to judgment or ruling revocation.
• The principle of argument. Litigants have the right to make arguments: (i) the right to argue is exercised throughout the proceedings; (ii) the content of the argument may encompass both procedural and substantive issues; and (iii) the forms and manners in which arguments are presented may be varied.
• The principle of disposition. Parties have the right to initiate, withdraw, or settle lawsuits, and choose their own litigation strategy.

3. Describe the general organisation of the legal profession.

China

In China, the legal profession is generally organised around a unified bar, where lawyers are not separated into barristers or solicitors but instead are authorised to conduct all aspects of legal practice. To become a lawyer in China, one typically needs to obtain a law degree from an accredited university, pass China’s unified qualification exam for legal professionals, and complete a period of one-year practical training in law firms.

Lawyers have the right to appear before all courts within the jurisdiction, regardless of their level of experience, except in some cases such as the ones involving state secrets. Foreign legal practitioners may practice foreign law in China in the capacity of ‘foreign legal consultants’ upon obtaining a licence from the Ministry of Justice.

While there are no specific plaintiff or defendant bars in China, there are specialised practice areas, where lawyers may choose to focus their expertise.

4. Give a brief overview of the political and social background as it relates to civil litigation.

China

China’s attitude towards litigation has significantly changed. Traditionally, Chinese culture values harmony and avoiding conflict, litigation was often viewed as a last resort. However, increased legal rights awareness has led to a more litigious culture.

The prevailing government policy towards litigation has been to encourage a more efficient and fair legal system. Procedural and structural reforms are ongoing, including an online dispute resolution platform, streamlined procedures, and expanded judicial resources.

China’s caseload is quite heavy, but people's courts are generally efficient.

Overall, China is a relatively litigious jurisdiction, with its evolving legal system increasingly being seen as a viable dispute resolution method. Today, a growing number of professional plaintiffs and activists advocate for social justice and civil rights through legal proceedings.

5. What are the sources of law and rules governing international jurisdiction in civil matters?

China

The sources of law and rules governing international jurisdiction in civil and commercial matters are the Civil Procedure Law of the People’s Republic of China (Amended in 2021), the Interpretation of the Supreme People’s Court on the Application of the Civil Procedure Law of the People’s Republic of China (Amended in 2022) and the Provisions on Issues Concerning the Litigation Jurisdiction over Foreign-related Civil and Commercial Litigation Cases (Amended in 2020).

The Special Maritime Procedure Law of the People’s Republic of China is also a key source of law and rules that govern international jurisdiction in maritime matters.

6. What are the criteria for determining the jurisdiction and venue of the competent court for a civil matter?

China

The criteria for determining the jurisdiction and venue of a competent people’s court for a civil matter typically include factors such as the geographical location of the parties, the subject matter of the dispute, and the amount in controversy. Parties may agree upon a specific forum for resolving their dispute, subject to certain limitations and conditions – the agreed-upon forum must have a sufficient connection to the dispute. The people’s court of the domicile of the defendant, the place where the contract is performed, the place where the contract is concluded, and the domicile of the plaintiff or the place of the subject matter would be considered as having sufficient connections.

If the defendant lacks residence in China and the lawsuit involves a contract or property rights dispute, the people’s court would have jurisdiction if China is the place where:

• the subject matter is located;
• the contract is concluded;
• the contract is performed;
• assets that can be seized are located;
• the tortious act occurred; or
• the representative organisation of the defendant is located.

7. Does your jurisdiction commonly attract disputes that have a nexus with other jurisdictions?

China

Yes, China commonly attracts disputes that have a nexus with other jurisdictions. The number of first-instance foreign-related civil and commercial cases accepted by the people’s court has been increasing, involving parties from over 100 countries and regions. The people’s court has established international commercial courts and a ‘one-stop’ diversified international commercial dispute resolution mechanism. The people’s court is also promoting the improvement of the system of rules governing foreign-related laws and the application of modern technologies.

When contemplating forum shopping in China, litigants should consider key characteristics including the availability of legal remedies, litigation cost, the complexity of legal system and potential delays in the resolution of the dispute. Tactical considerations may also include the choice of counsel and their familiarity with local procedures, as well as the choice of venue and the possibility of consolidating related claims.

8. How will a court treat a request to hear a dispute that is already pending before another forum?

China

Parallel litigation is permitted in China, as stipulated in article 531 of the Interpretation of the Supreme People’s Court on the Application of the Civil Procedure Law of the People’s Republic of China (Amended in 2022). For the same dispute, as long as the people’s court has jurisdiction pursuant to Chinese law or an international treaty to which China is party, then whether the case is also being conducted in another country or region, or whether the case is subject to judicial sovereignty exercised by another country, region or judgment, it would not affect the jurisdiction of the people’s court over such dispute.

9. How will the courts treat a dispute that is, or could be, subject to an arbitration clause or an agreement to arbitrate, including in interim proceedings?

China

The people’s court will defer to the tribunal to decide the disputes if there is a valid arbitration agreement. The people’s court has discretion to decide whether to grant interim reliefs in aid of arbitration proceedings based on Chinese law and treaties.

10. May courts in your country review arbitral awards on jurisdiction?

China

Yes. A people’s court may review arbitral awards on jurisdiction if a party filed an application to set aside or to refuse to enforce the final award. However, parties cannot file an appeal to the people’s court only to challenge the tribunal’s decision on jurisdiction.  

11. Are anti-suit injunctions available?

China

Yes. Although there is no Chinese legal provision directly addressing anti-suit injunctions, a people’s court may issue anti-suit injunctions by way of conduct preservation. This type of relief is more often granted in patent-related cases, such as Huawei Technologies Co, Ltd, et al v Conversant Wireless Licensing S. à.r. l (regarding a dispute over the confirmation of non-infringement of patent rights and licensing of standard essential patents).

12. Which entities are immune from being sued in your jurisdiction? In what circumstances? In what circumstances can creditors enforce a court judgment or arbitral award against a sovereign or a state entity?

China

China subscribes to the international legal principle of sovereign state immunity (ie, the immunity of sovereign states and their property from litigation and enforcement in other domestic courts).

13. How are proceedings commenced? To what extent will a court actively lead the proceedings and to what extent will the court rely on the parties to further the proceedings?

China

In China, a plaintiff may commence civil litigation proceedings by submitting a complaint to a people’s court. The people’s court will actively lead the proceedings by setting up a procedural timetable. The parties are responsible for presenting facts and reasons, and advancing arguments on the facts and the laws at trial.

14. What are the requirements for filing a claim? What is the pleading standard?

China

To file a claim, a plaintiff must be a citizen, legal person or organisation with a direct stake in the case. The style of the pleadings is more prone to notice pleading, which must include the plaintiff’s name and contact information, the defendant’s name and contact information, the relief that the plaintiff is seeking from the court and their supporting facts, and evidence with sources and witness information, etc. The plaintiff also needs to ensure that the people’s court has jurisdiction over the case.

15. What are the requirements for answering claims? What is the pleading standard?

China

The defendant must submit an answer to the complaint within 15 days of the date of receipt of the complaint. However, failure to file such an answer in China generally would not prevent the defendant from presenting its case at a later stage in the proceedings. The answer must include basic information on the defendants, including but not limited to their name and address. In China, defendants must provide a statement of defence addressing each allegation in the complaint. The statement should include clear responses to factual and legal issues, affirmative defences or counterclaims the defendant wishes to assert. China’s pleading standard requires the statement of defence to be sufficiently detailed and specific to notify the plaintiff of the defendant’s position on the disputed issues. The defendant must provide a clear narrative supporting its version of the events, and identify the legal basis for affirmative defences or counterclaims.

16. What are the rules regarding further briefs and submissions?

China

Further briefs and submissions are allowed, permitting parties to amend requests, factual assertions, and legal evaluations so long as such amendments would not cause undue delay or prejudice. Typically, these files must be filed before conclusion of court argument, with specific rules and limitations varying by court. No equivalent concept of amicus briefs exists in Chinese law, but the people’s court can seek expert opinions as needed.

17. To what degree are civil proceedings made public?

China

Civil cases are generally tried in open hearings, except for cases involving state secrets, personal privacy, or otherwise stipulated by law. Litigants in divorce or commercial secrets cases may apply for closed hearings.

Judgements and orders are generally public, while court filings such as pleadings and applications are not publicly accessible.

TV cameras and photographers are generally not allowed.

18. Will a court render (interim) assessments about any factual or legal issues in dispute? What role and approach do courts typically take regarding settlement? Are there mandatory settlement conferences between the parties at the outset of or during the litigation?

China

A people’s court will not render interim assessments in writing about any factual or legal issues in dispute, however, in judicial practice, the people’s court may express opinions about factual or legal issues orally to facilitate the mediation process. Under Chinese law, settlement negotiation (excluding mediation) is initiated and conducted by parties. Based upon the parties’ application and the agreement reached, the people’s court may issue a mediation agreement with legal effect. However, there are no mandatory requirements for the parties to conduct settlement conferences at the outset of or during the litigation.

19. Is referral to mediation or another form of ADR an option, or even mandatory, before or during the litigation?

China

Except for certain types of cases, such as labour disputes, ADR is not mandatory before the plaintiff’s initial litigation filing. After filing the claim and before the claim is officially accepted by the people’s court, to facilitate the parties’ settlement, it is common for the parties to be guided by the people’s court to enter into a pretrial mediation process, unless and until the parties express their unwillingness to engage in pre-litigation mediation. During the court proceedings, if both parties are willing to engage in the mediation, the people’s court will hold and facilitate the process. If an agreement is reached based on the free will of both sides, the people’s court will issue the mediation agreement to document the parties’ agreement.

20. What are the forms of emergency or interim relief?

China

A petitioner may apply for various forms of emergency and interim relief (eg: an asset preservation order to freeze another party’s assets; a conduct preservation order to demand that the respondent take specific actions or refrain from taking specific actions; an evidence preservation order to preserve evidence that is likely to be destroyed, lost or become difficult to obtain later; or an order of suspension of payments under the letter of guarantee or letter of credit).

21. What must a petitioner show to obtain interim relief?

China

The standard for obtaining interim relief varies depending on which form of interim relief is being applied for by the petitioner. For example, to obtain an asset preservation order or a conduct preservation order, the petitioner must show that it may become impossible to enforce the judgment, or that the conduct of the counterparty or other reason may cause damage to a party or to the case. To obtain an order of suspension of payments under the letter of guarantee or letter of credit, the petitioner must show that the case constitutes fraud in the letter of guarantee or the letter of credit.

22. What types of decisions (other than interim relief) may a court render in civil matters?

China

The types of decisions that a people’s court may render include:

• judgments on the merits, including a partial judgment in the case where a party brings multiple claims and parts of these claims are ripe for decision;
• rulings on procedural matters, such as ruling on refusal to accept a case, jurisdiction, dismissal of a case, suspension or ending of a court or enforcement proceeding; and
• payment orders, ordering the debtor to pay money or valuable securities without trial.

23. At what stage of the proceedings may a court render a decision? Are motions to dismiss and summary judgment available?

China

Typically, a people’s court will render its decision following the conclusion of the court debate. However, if the facts supporting parts of the claims are clear, the people’s court could issue a judgment on the relevant portion of claims prior to concluding the case. Motions to dismiss are available (eg, a defendant may request the people’s court to dismiss the case for reasons such as the defendant is not a proper defendant, lack of jurisdiction, the constitution of a repeated suit, etc). However, there is no equivalent concept of summary judgment under Chinese law.

24. Under which circumstances will a default judgment be rendered?

China

In judicial practice, if a defendant fails to appear at the appointed court proceeding, a people’s court will deem the defendant to have waived its rights to defend itself, adduce evidence, and confront the plaintiffs’ evidence. The people’s court will proceed to make a default judgment, taking into a number of factors, including whether the plaintiff has met its burden of proof based on applicable laws, pleadings and exhibits submitted by the plaintiff, and information obtained by the people’s court during the hearing.

25. How long does it typically take a court of first instance to render a decision?

China

For domestic cases, the people’s court of the first instance must render a decision within six months in ordinary proceedings, or within three months in summary proceedings. Such a period may be extended in exceptional circumstances.

For foreign-related cases, the people’s court of first instance is not bound by any time limitation for rendering a decision. Accordingly, in such cases, the people’s court may take a longer time to render a decision, with the period varying from case to case, depending on specific circumstances.

26. How can third parties become involved in proceedings?

China

A third party may become involved in proceedings upon a party’s application if granted by the people’s court, or the people’s court can also join a third party on the court’s own initiative. Additionally, a third party may apply to the people’s court to join a case if such third party has an independent claim to the subject matter or has a legal stake in the outcome of the case. Generally, failure to join a party will not preclude a litigant from later bringing the same or similar claims against that party. A judgment rendered by the people’s court is enforceable against the party against whom the judgment is made. However, the facts determined therein will have a general binding effect unless a third party has evidence to prove the contrary.

27. Describe the rules of fact-finding in your jurisdiction.

China

Generally, the parties to a lawsuit bear the obligation to adduce evidence to prove the facts in support of their claims or defences. A people’s court will hear parties’ opinions on the authentication, legitimacy and relevance of the evidence adduced, as well as their explanation and debate on the probative value of the evidence to determine which evidence is to be relied upon by the people’s court to ascertain the facts of the case.

28. Will a court take or initiate the taking of evidence or will it rely on the parties to request the taking of evidence and to present it?

China

Typically, a people’s court will rely on the parties to gather and present evidence, because the parties bear the primary obligation to prove their claims and defences. If, however, for objective reasons, a party is unable to gather evidence on its own, or where the people’s court otherwise deems it necessary to obtain certain specific evidence, the people’s court may investigate and gather evidence on its own initiative.

29. Is an opponent obliged to produce evidence that is harmful to it in the proceedings? Is there a document disclosure procedure in place? What are the consequences if evidence is not produced by a party?

China

There is no document disclosure procedure in place in China. However, any party must produce evidence even if it is harmful to them if ordered by the people’s court to do so in certain circumstances, such as where the people’s court, upon the petitioner’s application, orders the opponent to produce evidence that is under the opponent’s control. If a party were to fail to comply with such a people’s court order without adequate justification, the people’s court may draw an adverse inference against that party. And, if the opponent were to commit more severe behaviour, such as destroying the evidence, the people’s court may fine and even detain the opponent.

30. Please describe the key characteristics of witness evidence in your jurisdiction. Is witness preparation allowed?

China

Witness evidence is one of the types of evidence that is accepted in Chinese civil litigation proceedings. Chinese law requires that any witness testify in court. However, if a witness testifies in both sides’ presence before the hearing or during the people’s court’s investigation and questioning, the witness will be deemed to be testifying in court. The witness statement from a witness who fails to appear in court without justified reasons may not be taken as the basis for ascertaining the facts in a case.

Chinese law does not address whether or not witness preparation is allowed. In practice, any witness is expected to provide his or her own genuine opinions.

31. Who appoints expert witnesses? What is the role of experts?

China

Expert witnesses may become involved in court proceedings by means of a judicial identification procedure, whereby experts will provide their objective opinions on the matters entrusted to them by the people’s court. The identification procedure may result from a party’s application, in which case the people’s court would only appoint an expert if the parties were to fail to reach an agreement on the candidate expert. Alternatively, the people’s court may unilaterally initiate the identification procedure itself, and may solicit the parties’ opinions on qualified candidates before appointing the qualified expert by itself.

32. Can parties to proceedings (or a party's directors and officers in the case of a legal person) act as witnesses? Can the court draw negative inferences from a party's failure to testify or act as a witness?

China

As a general rule, parties to proceedings cannot simultaneously act as witnesses. In the case of a legal person, Chinese law does not prohibit a party’s directors and officers from acting as witnesses. However, because of their inherent conflicts of interest with parties to the proceeding, their statements alone are insufficient to provide the basis for ascertaining the facts of a case and, therefore must be corroborated by other evidence. Failure to testify or act as a witness may impact the people’s court’s decision on whether parties have met their burden of proof, given that parties bear the obligation to promptly provide evidence to support their claims.

33. How is foreign law or foreign-language documentation introduced into the proceedings and considered by the courts?

China

A people’s court will consider foreign laws in certain circumstances, such as when they are the governing laws chosen by parties in foreign-related cases or after applying choice of law rules. The substance of a relevant foreign law may be proven by various means, such as parties’ submissions and expert opinions on foreign laws. Foreign-language evidence must be accompanied by a Chinese translation and, if originating from outside the territory of China, must comply with certain formal requirements, such as notarisation and/or authentication by a Chinese embassy or consulate located in that country. The formality requirement is expected to be simplified after the Hague Convention of 5 October 1961 takes effect in China from 7 November 2023.

34. What standard of proof applies in civil litigation? Are there different standards for different issues?

China

The standard of proof varies depending on the type of case. Generally, the standard of proof applied in civil cases is ‘preponderance of the evidence’ (ie, that the evidence produced to support the claim must reach the standard that it is more likely than not that the facts being alleged by one party are true). However, in some circumstances, such as to prove the existence of fraud, duress, malicious conspiracy, or the existence of an oral will or gift, the people’s court applies the higher standard of ‘beyond a reasonable doubt’ (ie, the people’s court believes that the possibility of the existence of the facts to be proved to a degree that eliminates reasonable doubt).

35. What are the possibilities to appeal a judicial decision? How many levels of appeal are there?

China

No permission from the people’s court is required for an appeal. A party is entitled to file an appeal against a judgment or a ruling of the people’s court if the appeal is filed within the prescribed period.

In general, there is only one level of appeal. Parties can, however, seek a retrial in exceptional circumstances if certain criteria are satisfied.

36. What aspects of a lower court's decisions will an appeals court review and by what standards?

China

An appellate people’s court has large discretion in deciding the scope and overall conduct of the appeal. The appellate people’s court can consider if there was an error of facts, an error of law, or if the lower people’s court seriously violated any statutory procedure.

37. How long does it usually take to obtain an appellate decision?

China

The time required to obtain an appellate decision varies. The Civil Procedure Law of the People’s Republic of China (Amended in 2021) provides that an appellate decision for an appeal to a judgment should be issued within three months from the date of acceptance of the appeal, and that an appellate decision for an appeal to a ruling should be issued within 30 days from the date of acceptance of the appeal. However, in practice, the appeal decision process usually requires a much longer period.

38. In which conditions does your domestic arbitration law apply? Does it apply equally to purely domestic and international arbitrations, and to commercial and investor-state arbitrations?

China

Chinese arbitration law applies to all wholly domestic arbitration proceedings. For cases involving foreign civil relationships, parties are free to choose the law that will govern the arbitration agreement. However, in the absence of the parties’ agreement, the arbitration law of the seat of the arbitration will apply. If the seat of the arbitration or the place of the arbitration institution cannot be determined, then Chinese arbitration law may apply.

The Arbitration Law of the People’s Republic of China (Amended in 2017) expressly provides that only disputes between citizens, corporations and other organisations of equal status may be submitted for arbitration. Accordingly, the prevalent view is that investor-state arbitration is prohibited under this law.

39. Give an overview of instances in which state courts come into play in domestic and international arbitration proceedings.

China

A people’s court may intervene in arbitration proceedings under certain limited circumstances prescribed by law, including reviewing jurisdiction challenges, granting interim measures in aid of arbitration proceedings, and setting aside and/or recognising as well as enforcing arbitral awards.

40. Describe the rules governing recognition and enforcement of arbitral awards in your jurisdiction. To what extent do domestic courts review arbitral awards on the substance?

China

Domestic arbitral awards can be enforced pursuant to Chinese law. Arbitral awards issued in the Hong Kong Special Administrative Region and Macao Special Administrative Region may be recognised and enforced pursuant arrangements between the Chinese Mainland with these respective jurisdictions. China is a party to the 1959 Convention on the Recognition and Enforcement of Arbitral Awards, and foreign arbitral awards may be recognised and enforced in China pursuant to this Convention. The people’s court will not review an arbitral award in substance, and would only set aside or refuse to enforce an arbitral award based on limited grounds as specified under the relevant laws, arrangements or treaties.

41. Are class actions available?

China

Chinese law permits civil actions involving two or more plaintiffs and/or defendants, which are referred to as ‘collective actions’ as opposed to ‘class actions’. Key criteria for collective actions include:

• that there are two or more plaintiffs and/or defendants;
• that the subject of the cause of action of each party is the same or of the same kind;
• that the people’s court considered the claims can be dealt with collectively; and
• that the parties consented to such collective actions.

Notification and representative actions are available for collective actions that involve numerous plaintiffs. While most collective actions are conducted on an opt-in basis, it is also possible for collective actions relating to disputes relating to securities to be conducted on an opt-out basis, subject to certain criteria being met.

42. Are derivative actions available?

China

Derivative actions are available in China, which allows a shareholder to commence a legal action on behalf of the company against the company’s directors, officers or supervisors if, in the course of performing their duties, such directors, officers or supervisors have violated the law, an administrative regulation, or the articles of association of the company.

Under the Company Law of the People’s Republic of China (Amended in 2018), only shareholders, who, individually or collectively, own at least 1 per cent of the company’s shares for a continuous period of 180 days or more can bring a derivative action. Normally, the shareholders must first request the board or supervisors of the companies to commence proceedings, failing which, the shareholder may commence proceedings on behalf of the company.

43. Are fast-track proceedings available?

China

Summary procedure is available for simple civil cases heard by a primary people’s court and their detached tribunals where the facts are clear, the rights and obligations are unambiguous, and the disputes are trivial. The parties may also choose to adopt the summary procedure by agreement.

Cases administered based on summary procedure will be heard by one judge and must be concluded within three months of the date of acceptance, unless a time extension is granted by the head of the people’s court.

Further, for cases that satisfy requirements for summary procedure and where the value of the claim is less than 50 per cent of the prior year’s average annual wages of workers in a given province, a small claims procedure is also available. Unlike cases administered by summary procedure, which are appealable, judgments made in small claims procedure are final and non-appealable.

44. Is it possible to conduct proceedings in a foreign language?

China

Chinese civil proceedings must be conducted in Chinese. For cases involving foreign elements, parties may request translation at their own cost. Additionally, it is required that any documentary evidence presented to a people’s court must be translated into Chinese if not provided in Chinese.

45. What legal effects does a judgment have?

China

A judgment and/or ruling issued by a people’s court of first instance takes effect upon the expiration of the time for appeal. A judgment and/or ruling issued by the people’s court of second instance takes effect once served.

Once a judgment or ruling becomes effective, it has a binding effect on both the people’s court and the parties. This means that parties may not seek to re-litigate the same claims relating to the same subject matter between the same parties, or claims that may lead to conflicting judgments. If a party fails to perform the judgment or ruling, the counterparty may seek enforcement of the judgment or ruling.

46. What are the procedures and options for enforcing a domestic judgment?

China

An application for enforcement of a domestic judgment should be made within two years from the last date of the performance period stipulated in the judgment. There are a number of options available for enforcement, depending on the types of assets, including seizures of goods.

A people’s court may take a number of different actions against a judgment debtor who fails to perform the judgment debt within the prescribed time, including the imposition of consumption restrictions.

47. Under what circumstances will a foreign judgment be enforced in your jurisdiction?

China

Foreign judgments may be recognised and enforced in China, either based on treaties to which China is a party, or in accordance with the principle of reciprocity. In deciding whether to recognise and enforce a foreign judgment, a people’s court will consider whether the foreign judgment is final and legally effective in the country where it was rendered, and whether the foreign court rendering the judgment has jurisdiction over the dispute. The people’s court may refuse to recognise and enforce foreign court judgments for lack of due process, violation of public interest, or if recognising and enforcing such foreign judgment may result in conflicting judgments.

48. Will the successful party's costs be borne by the opponent?

China

Typically, the losing party will be ordered to pay for the court fees, except for those voluntarily borne by the successful party. Where one party partially wins the case, the people’s court has large discretion to allocate court fees based on the facts of and the parties’ overall conduct in that case. Attorneys’ fees are separately borne by the respective parties unless otherwise agreed or expressly provided by law.

49. May a party apply for legal aid to finance court proceedings? What other options are available for parties who may not be able to afford litigation?

China

Legal aid is available for parties with financial difficulties in criminal cases as well as for parties in limited types of civil and administrative cases. Third-party funding is not expressly excluded by law. In practice, the people’s court will consider the validity of any third-party funding agreement based on the facts of each case.

50. Are contingency fee arrangements permissible? Are they commonly used?

China

Contingency fee arrangements (as well as damages-based agreements and conditional fee agreements) are permitted and commonly used in China, especially in the context of commercial disputes, subject to upper limits prescribed by law.

Contingency fee arrangements, however, cannot be used in certain specific types of cases, including: criminal litigation; administrative litigation; state compensation; marriage and inheritance; as well as claims for social insurance benefits, minimum living security benefits, alimony, child support, parent support, pensions, relief funds, work injury compensation and labour remuneration.

51. Is third-party funding allowed in your jurisdiction?

China

There is no express legislation or regulation governing third-party funding in China. In practice, the people’s court will consider the validity of any third-party funding agreement based on the facts of each case.

52. Are there fee scales lawyers must follow? Are there upper or lower limits for fees charged by lawyers in your jurisdiction?

China

The National Development and Reform Commission has issued guidelines on charges relating to a very limited type of cases. The majority of cases, however, are not subject to any limit. The exception to this general rule is a contingency fee arrangement, which is subject to a statutory upper limit calculated by reference to the scale of the amount of the subject.

The authors would like to thank Bian Tong, Xing Jingyu, Shi Yedong and Li Zhuangyi for their assistance in preparing this chapter.