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From the above table 2 showing how the courts judged foreign-related cases, in civil and commercial matters, we can arrive at a rudimentary conclusion of Chinese judicial practice on the ascertainment-of-jurisdiction methods. More often, Chinese courts adopt common jurisdiction (eleven cases), special jurisdiction (ten cases) and presumptive jurisdiction (seven cases), being 30.5%, 27.8% and 19.4% respectively. They sometime adopt exclusive jurisdiction (one case), selective jurisdiction (one case) and exclusive jurisdiction by arbitration agreement (one case), being 2.8% each other. However, there are five cases in which courts didn’t explain reasons for jurisdiction, being 13.9%.
IV. A. Common Jurisdiction and Special Jurisdiction
So-called common jurisdiction has another name called “ordinary trial”, in which court determines one’s jurisdiction under the relationship between the defendant and the court area. Generally speaking, the courts regard the defendant’s residence as the jurisdiction ground. Chinese courts regard the defendant’s residence as the basis of exercising common jurisdiction over the foreign-related cases in civil and commercial matters too. According to the Articles 237 and 22 of 1991 Civil Procedural Law, the courts have jurisdiction over the foreign-related cases in civil and commercial matters if the defendant’s residence is located in China.
This is either suitable for the situation that foreign plaintiffs (natural person, legal person or other organizations) prosecute, or suitable for the foreign-related cases in civil and commercial matters taking place between Chinese parties who have residences in China, e.g., Hubei Technology Import & Export Co. v. Hubei Branch of Chinese People’s Insurance Co. Besides, Article 23 of Civil Procedural Law has also stipulated the plaintiff’s residence as the supplement of common jurisdiction.
The common jurisdiction, however, is just a kind of jurisdiction while there is not special jurisdiction. So-called the special jurisdiction has another name called “special trial”, in which court determines one’s jurisdiction under the relationship between the object of litigation and the court area.
Under defendant’s domicile not located in China, the Civil Procedural Law stipulates also some special jurisdiction principles according to different nature of the foreign-related cases in civil and commercial matters. According to the Article 243 of the Civil Procedural Law, the courts shall have jurisdiction over an action arising from a contractual relation or other property rights and interests, if the place where the contract is concluded, or the place where the contract is performed, or the place where the subject matter of the action, or the defendant’s property, or the branch entity of the defendant or the place where a tortuous act is committed is within the territory of the PRC.
In addition, Articles 24 to 33 of the Civil Procedural Law have also stipulated that some special civil and commercial cases can be adjudicated by courts where the residence of defendant is located. In above-mentioned statistical table 1, it designates ten cases mainly taken by the place where the contract is concluded, or the place where the contract is performed or the place where a tortuous act is committed for as jurisdiction ground. Among them, eight cases were ruled by Article 243 of the Civil Procedural Law and another two cases ruled by the Article 24 of the Civil Procedural Law, i.e., Heilongjiang Dongning County Huabo Economical Trade Co. v. Shandong Weihai Co. of Chinese Foreign Shipment etc. and Shenzheng Branch of China Industrial and Commercial Bank v. Jiaxing Group Co. Ltd. The defendants in above-mentioned two cases are the defendants whose domiciles are located in China, so they are not suitable for the Article 243.
IV. B. Agreed Selective Jurisdiction and Presumptive Jurisdiction
Agreed selective jurisdiction means that both sides agree to select a court while being desirable before or after dispute. During Chinese international civil action, agreed selective jurisdiction is only limited to express selection and it should reach in the written form but not oral agreement. For example, in Yuancheng (Qingdao) Trading International Corp. v. Xixia City Hengxing Trade Co. Ltd., the bill of lading involved in the case is stated clearly: “Any dispute and claim right of the last instance caused by the contract is in Chinese court but not other courts.” That is to say that the parties chose the Chinese court as jurisdiction court through the form of written agreement, thus it establish that Chinese court shall have jurisdiction over this case.
According to the Article 244 of Civil Procedural Law, there are still three questions that we should pay attention to. First, the range of this kind of choice is generally limited to the disputes over foreign-related contract or other property rights and interests but excludes the disputes over the personal identity, the personal ability and family relationship; Second, the court of this kind of choice has contacts with dispute and is only limited to the court of the first instance; Third, this kind of choice can’t violate the provisions about the grade jurisdiction and exclusive jurisdiction in China.
But in practice, the parties have not chosen the court desirably in advance in most cases, and it is very difficult for the party to reach an agreement after the dispute arising. So, the courts adopt presumptive jurisdiction to define their jurisdiction often during trial. So-called presumptive jurisdiction means that when one party is litigating to a court, another party doesn’t challenge for this court’s jurisdiction, or he mentions counter-action in this court. The Article 245 of the Civil Procedural Law stipulates so.
However, this kind of jurisdiction can’t violate the exclusive jurisdiction. In addition, the defendant should volunteer to appear before court and reply on the essential question of dispute or mention any counter-actions.
In Sino-Add (Singapore) PTE. Ltd. v. Karawasha Resource Ltd., the court thinks:
Under the plaintiff of external enterprise of Singapore litigated an action to this court, the defendant of the other legal person of enterprise of the Hong Kong Special Administrative Region neither appeared before this court to the action nor put forward any objection about jurisdiction or other. Therefore, it should assert that the defendant accepted jurisdiction of this court over the case; According to the Article 243 of the Civil Procedural Law, this court has jurisdiction over this case legally.
In above case, though this court has adopted presumptive jurisdiction, the defendant involved in the case neither appeared before the court nor replied for the plaintiff’s action, it seems that it does not accord with the terms which are stipulated by the Civil Procedural Law.
IV. C. Exclusive Jurisdiction
Exclusive jurisdiction means that the countries concerned keep their acceptance to the lawsuit and make the right awarded unconditionally over specific foreign-related cases in civil and commercial matters, it then get rid of the jurisdiction of other national courts over these cases. According to Article 246 of the Civil Procedural Law, the courts of the PRC shall have jurisdiction over those arising from a dispute concerning a Chinese-foreign equity joint venture contract, a Chinese-foreign co-operative enterprise contract, or a Chinese-foreign cooperative exploration and development of natural resources contract, which is performed within the territory of the PRC.
In Ural Potassium Co. Ltd. v. Jinan Huaiyin General Chemical Factory, the Court points out in the second instance:
This case belongs to Sino-foreign joint venture dispute over management contract. That Ural chose and prosecuted to this court according to the contract arrangement is according with the Article 246 of the Civil Procedural Law, and therefore, Jinan Intermediate People’s Court should enjoy jurisdiction over this case.
Besides above-mentioned three kinds of special contract cases, according to Articles 237 and 34 of the Civil Procedural Law, the following cases are adjudicated exclusively by Chinese courts too: (1) those arising from a dispute concerning an immovable located within the territory of the PRC; (2) those arising from a dispute concerning operations in a harbor located within the territory of the PRC; (3) those arising from a dispute concerning a succession, if the domicile or the habitual residence of the deceased, or the place where the main assets locate is within the territory of the PRC.
V. The Choice-of-Law Methods
From the above table 3 showing how the courts judged foreign-related cases, in civil and commercial matters, we can arrive at a rudimentary conclusion of Chinese judicial practice on the choice-of-law methods. More often, Chinese courts adopt the principle of party autonomy (fourteen cases) and the principle of the most significant relationship (ten cases), being 42.42% and 30.3% respectively. They sometime adopt the dépeçage method (one case) and direct application of law (one case), being 3.06% each other.
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