IBA: Shanghai to play leading role in APAC
Shanghai will become one of the Asia-Pacific region's strongest players in international arbitration as the city continues to host more international arbitration institutions and has a strong support from the courts, said the president of the International Bar Association (IBA).
The Hong Kong International Arbitration Center, the International Court of Arbitration of the International Chamber of Commerce and the Singapore International Arbitration Centre have set up offices within the China (Shanghai) Pilot Free Trade Zone, boosting the city's ability to resolve disputes in international trade and investment.
"The convergence of such institutions will bring about a bigger market of arbitration, an approach that is widely-used in the world to settle commercial disputes. This is especially important now that more foreign businesses have poured into the Shanghai FTZ," said IBA President David W Rivkin at a media conference during the annual International Arbitration Day on March 4.
"Moreover, Shanghai courts have shown a strong support for arbitration and the list of situations in which the courts will set aside or decline to enforce an arbitration award has become shorter," added Rivkin.
Since the establishment of the FTZ in Shanghai in September 2013, the nationalities of arbitrators in the city have become more diverse. The Shanghai International Arbitration Center currently has a panel of more than 850 arbitrators and nearly 40 percent of them are from about 40 countries and regions.
China's State Council had also in April 2015 announced its intent to turn Shanghai into a global arbitration center in the Asia-Pacific region.
"One big difference between arbitration and court hearings is that people can select arbitrations themselves, and foreign businesses tend to select those from their home countries because they are more common in law, culture, and beliefs," said Yao Hongmin, assistant secretary-general of the arbitration center.
Two years ago, the China (Shanghai) Pilot Free Trade Zone Arbitration Rules was laid out. Legal experts have said that the rules, which apply to innovations that are brought into the country for the first time, are tailored for the zone and consistent with international standards.
One unique rule is that people can choose arbitrators from outside the panel of mediators.
"New types of cases, such as e-finance and offshore finance, may happen in the FTZ. Professionals from the specific sectors may have more experience on the front lines than those mediators on the panel. They can make proper judgments when no applicable law is available," Yao said.
By the end of last year, a total of 100 commercial disputes — involving more than 575 million yuan ($88 million) — occurring in the Shanghai FTZ had been received by Shanghai International Arbitration Center.
Ma Yi, vice chairman and secretary-general of the center, said that they have initiated the China Free Trade Zone Arbitration Cooperative Alliance with the arbitration commissions in other cities. Furthermore, the center has also penned cooperation agreements with arbitration associations and centers in foreign countries, including the United States, Malaysia, Japan and Switzerland.