Whilst China has been a contracting state to the New York Convention since around 1987, thus allowing recognition and enforcement of foreign arbitral awards in China, this is certainly not the case for recognition and enforcement of foreign judgments. Generally speaking, Chinese courts would only recognise and enforce a foreign judgment on the basis of international convention, bilateral treaties or “principle of reciprocity” provided always that such recognition and enforcement do not breach the basic principles of Chinese law, state sovereignty and security or public interest.
As of today, China has entered into 34 bilateral treaties with other countries for recognition and enforcement of their judgments. For those countries with which China does not have a bilateral treaty, which include its major investment partners, such as the US and the UK, the parties would need to rely on the “principle of reciprocity” to seek recognition and enforcement of foreign judgments by the local courts in China, which is always subject to judicial interpretation by the local People’s courts on a case by case basis. For further information about a recent landmark decision by the Shanghai Maritime Court for recognition and enforcement of a foreign judgment, please visit our article on this here.
Generally speaking, the application for recognition and enforcement of a foreign judgment in China carries a statutory limitation period of two years (which usually runs from the date of the judgment) (“Limitation Period”). The Limitation Period is considerably shorter than in other jurisdictions, such as Hong Kong which is 12 years in the case of enforcement of judgment. Usually, in preparing for the application, the parties are required to prepare a translation (by a certified translator) of all non-Chinese documents relating to the proceedings which have to be notarised by local China consular authorities. Parties should be aware that these essential steps may take weeks if not more to complete. Given that the Limitation Period is mandatory and cannot be extended by parties’ agreement, it is advisable that those who seek to enforce a judgment in China must act sooner rather than later, or otherwise their application will be time-barred under Chinese law.
Although the standard of review adopted by the Chinese courts in dealing with an application for recognition and enforcement of a foreign judgment may vary…