China advances as new destination for international commercial arbitration

In recent years, China has made substantial strides in foreign-related arbitration, gaining increased recognition globally. On July 31, the Ministry of Justice held a symposium on foreign-related arbitration work, focusing on accelerating the reform and development of foreign-related arbitration to enhance China's international influence and competitiveness in arbitration.

Achievements of pilot program highlight China's role in international commercial arbitration

As a globally recognized mechanism for resolving commercial disputes, arbitration plays a vital role in national economic development. China has been running a pilot program since 2022 aimed at establishing international commercial arbitration centers in five regions - Beijing, Shanghai, Guangzhou, Shenzhen, and Hainan - which has yielded significant progress.

Beijing has utilized its rich legal resources to foster a collaborative arbitration ecosystem, positioning itself as a preferred destination for international commercial dispute resolution. Meanwhile, Shanghai has actively promoted the formulation of one local regulation and four policy documents on arbitration. In 2024, the municipality witnessed a 61 percent rise in foreign-related arbitration cases handled and a 66 percent increase in total value of the subject matter compared to 2022, marking its rapid progress toward becoming a leading Asia-Pacific arbitration center.

Guangdong province has advanced the development of international commercial arbitration centers in the cities of Guangzhou and Shenzhen. Arbitration institutions in both cities rank highly both nationally and globally in terms of dispute value, with the value of foreign-related cases they handled accounting for 30 percent of the national total in 2024.

Data indicates that China has 285 arbitration institutions and over 60,000 arbitrators, including more than 3,400 overseas arbitrators. In 2024, a total of 4,373 foreign-related arbitration cases were handled nationwide, involving a total value of 197.8 billion yuan ($27.51 billion), contributing to promoting international economic and trade exchanges, and supporting high-quality economic development and high-level opening-up.  

The pilot program for the construction of international commercial arbitration centers has yielded significant outcomes with China’s increasing global influence in arbitration. This year, Beijing, Shenzhen, and Shanghai have ranked among the top ten most popular arbitration destinations worldwide. The China International Economic and Trade Arbitration Commission (CIETAC), the Shenzhen Court of International Arbitration, and the Beijing Arbitration Commission (BAC) handled cases averaging an annual value exceeding 100 billion yuan.

Notably, rulings by the Hainan International Arbitration Court (HIAC) were recognized and enforced by the High Court of Malaysia, highlighting China's growing credibility in international arbitration and its progress in becoming a new preferred destination for international commercial arbitration.

Reforms and innovation drive development of world-class arbitration institutions‌

The cultivation of world-class arbitration institutions is a key goal for the development of China's foreign-related arbitration. Arbitration institutions nationwide have been enhancing the quality and credibility of their arbitration services through reforms and innovation.

For instance, the BAC has deepened reforms of its arbitration system and mechanisms, with its arbitration awards recognized in over 70 countries and regions, progressing to become a world-class arbitration institution.

Shanghai has supported its arbitration institutions in setting up branches overseas, creating a competitive edge in cross-border services. The municipality has also attracted five well-known international arbitration institutions, including the World Intellectual Property Organization Arbitration and Mediation Center and the International Chamber of Commerce, to set up branches or representative offices, fostering an arbitration service cluster.

Institutional innovation has been particularly pronounced at the HIAC. In 2019, it took the lead in initiating institutional reforms, establishing a corporate governance pattern led by its Board of Directors. Over the past five years, it has handled more than 13,000 cases, maintaining a zero record of arbitration awards being set aside by judicial authorities, further cementing its credibility.

The CIETAC, as China's first arbitration institution, has consistently ranked among the top three globally across various metrics over the past five years. Its 10th edition of arbitration rules is hailed as innovative and advanced, which provides an institutional guarantee for high-quality development of arbitration services.

The cultivation of foreign-related arbitration expertise is pivotal in driving China's arbitration services toward global prominence.

Beijing has integrated the cultivation of arbitration experts into its broader foreign-related legal professional development plans, collaborating with universities and optimizing expert recruitment policies.

Shanghai incorporates arbitration professionals into its Leading Expert Program under the Eastern Expert Plan, and offers joint master's programs in international arbitration. The municipality boasts 898 oversea arbitrators from over 110 countries and regions, according to the arbitrator panels of arbitration institutions within Shanghai.

Guangdong has collaborated with the Hong Kong and Macao special administrative regions to formulate guidelines for the panel of arbitrators, and establish cooperation mechanisms with universities for the cultivation of arbitrators. Arbitration institutions in Guangzhou and Shenzhen include overseas arbitrators from multiple countries and regions. By 2024, more than 700 overseas arbitrators from these institutions participated in case handling.

Moreover, the CIETAC, boasting 1,881 arbitrators from 145 countries and regions, has collaborated with universities to establish innovative bases for the coordinated cultivation of foreign-related legal talents.

Expansion of exchanges and cooperation enhances the global influence of China's arbitration service

China has enhanced its international reputation and influence in foreign-related arbitration by its active participation in international exchanges and cooperation. For example, Beijing's arbitration institutions have deeply participated in international rule-making and held high-profile events such as the China Arbitration Week, serving as significant platforms for exchanges in the field of international arbitration. Similarly, Shanghai has held events such as the Shanghai International Arbitration Forum, attracting the participation of numerous international organizations and arbitration institutions.

Furthermore, Hainan, leveraging its geographical advantages and visa-free policies, has established the Thai-Chinese Arbitration and Mediation Center in partnership with the Thailand Arbitration Center. The province has focused on being at the forefront of international arbitration trends through organizing overseas promotional activities and hosting events such as the Hainan Free Trade Port Legal Week.

In addition, the CIETAC has signed cooperation agreements with 97 dispute resolution institutions worldwide, released the Beijing Joint Declaration of the Belt and Road Arbitration Institutions, and launched brand events with international influence to widely promote the arbitration system and showcase the achievements of China's rule of law development.

Moving forward, China will further develop international commercial arbitration centers, expanding beyond the five pilot centers to regions such as the Beijing-Tianjin-Hebei region and the Yangtze River Delta, with further exploration of establishing regional international commercial arbitration centers in cities including Chongqing and Xi'an.