Views
The Latest Development on Anti-suit Injunction Wielded by Chinese Courts to Restrain Foreign Parallel Proceedings
(This post is provided by Zeyu Huang, who is an associate attorney of Hui Zhong Law Firm based in Shenzhen. Mr. Huang obtained his LLB degree from the Remin University of China Law School. He is also a PhD candidate & LLM at the Faculty of Law in University of Macau. The author may be contacted at the e-mail address: huangzeyu@huizhonglaw.com)
When confronted with international parallel proceedings due to the existence of a competent foreign court having adjudicative jurisdiction, the seized foreign court located in common law jurisdictions seems to see it as no offence to Chinese courts by granting anti-suit injunctions to restrain Chinese proceedings. This is because the common law court believes that “An order of this kind [anti-suit injunction] is made in personam against a party subject to the court’s jurisdiction by way of requiring compliance with agreed terms. It does not purport to have direct effect on the proceedings in the PRC. This court respects such proceedings as a matter of judicial comity”. [1] However, the fact that the anti-suit injunction is not directly targeted at people’s courts in the PRC does not prevent Chinese judges from believing that it is inappropriate for foreign courts to issue an anti-suit injunction restraining Chinese proceedings. Instead, they would likely view such interim order as something that purports to indirectly deprive the party of the right of having access to Chinese court and would unavoidably impact Chinese proceedings.
The attitude of Chinese courts towards the anti-suit injunction – a fine-tuning tool to curb parallel proceedings – has changed in recent years. In fact, they have progressively become open-minded to resorting to anti-suit injunctions or other similar orders that are issued to prevent parties from continuing foreign proceedings in parallel. Following that, the real question is whether and how anti-suit injunction is compatible with Chinese law. Some argued that Article 100 of the PRC CPL provides a legal basis for granting injunctions having similar effects with anti-suit injunction at common law. [2] It provides that:
“The people’s court may upon the request of one party to issue a ruling to preserve the other party’s assets or compel the other party to perform certain act or refrain from doing certain act, in cases where the execution of the judgment would face difficulties, or the party would suffer other damages due to the acts of the other party or for other reasons. If necessary, the people’s court also could make a ruling of such preservative measures without one party’s application.” [3]
Accordingly, Chinese people’s court may make a ruling to limit one party from pursuing parallel foreign proceedings if such action may render the enforcement of Chinese judgment difficult or cause other possible damages to the other party.
In maritime disputes, Chinese maritime courts are also empowered by special legislation to issue maritime injunctions having anti-suit or anti-anti-suit effects. Article 51 of the PRC Maritime Special Procedure Law provides that the maritime court may upon the application of a maritime claimant issue a maritime injunction to compel the respondent to do or not to do certain acts in order to protect the claimant’s lawful rights and interests from being infringed. [4] The maritime injunction is not constrained by the jurisdiction agreement or arbitration agreement as agreed upon between the parties in relation to the maritime claim. [5] In order to obtain a maritime injunction, three requirements shall be satisfied – firstly, the applicant has a specific maritime claim; secondly, there is a need to rectify the respondent’s act which violates the law or breaches the contract; thirdly, a situation of emergency exists in which the damages would be caused or increased if the maritime injunction is not issued immediately. [6] Like the provision of the PRC CPL, the maritime injunction issued by the Chinese maritime court is mainly directed to mitigate the damages caused by the party’s behaviour to the other parties’ relevant rights and interests.
In Huatai P&C Insurance Corp Ltd Shenzhen Branch v Clipper Chartering SA, the Maritime Court of Wuhan City granted the maritime injunction upon the claimant’s application to oblige the respondent to immediately withdraw the anti-suit injunction granted by the High Court of the Hong Kong SAR to restrain the Mainland proceedings. [7] The Hong Kong anti-suit injunction was successfully sought by the respondent on the grounds of the existence of a valid arbitration agreement. [8] However, the respondent did not challenge the jurisdiction of the Mainland maritime court over the dispute arising from the contract of carriage of goods by sea. Therefore, the Maritime Court of Wuhan City held that the respondent had submitted to its jurisdiction. As a result, the application launched by the respondent to the High Court of the Hong Kong SAR for the anti-suit injunction to restrain the Mainland Chinese proceedings had infringed the legitimate rights and interests of the claimant. In accordance with Article 51 of the PRC Maritime Special Procedure Law, a Chinese maritime injunction was granted to order the respondent domiciled in Greece to withdraw the Hong Kong anti-suit injunction (HCCT28/2017). [9] As the maritime injunction in the Huatai Property case was a Mainland Chinese ruling issued directly against the anti-suit injunction granted by a Hong Kong court, it is fair to say that if necessary Chinese people’s court does not hesitate to issue a compulsory injunction “which orders a party not to seek injunction relief in another forum in relation to proceedings in the issuing forum”. [10] This kind of compulsory injunction is also called ‘anti-anti-suit injunction’ or ‘defensive anti-suit injunction’. [11]
When it comes to civil and commercial matters, including preserving intellectual property rights, the people’s court in Mainland China is also prepared to issue procedural orders or rulings to prevent the parties from pursuing foreign proceedings, similar to anti-suit injunctions or anti-anti-suit injunction in common law world. In Guangdong OPPO Mobile Telecommunications Corp Ltd and its Shenzhen Branch v Sharp Corporation and ScienBiziP Japan Corporation, the plaintiff OPPO made an application to the seized Chinese court for a ruling to preserve actions or inactions.[12] Before and after the application, the defendant Sharp had brought tort claims arising from SEP (standard essential patent) licensing against OPPO by commencing several parallel proceedings before German courts, a Japanese court and a Taiwanese court. [13] In the face of foreign parallel proceedings, the Intermediate People’s Court of Shenzhen City of Guangdong Province rendered a ruling to restrain the defendant Sharp from pursing any new action or applying for any judicial injunction before a Chinese final judgment was made for the patent dispute. [14] The breach of the ruling would entail a fine of RMB 1 million per day. [15] Almost 7 hours after the Chinese ‘anti-suit injunction’ was issued, a German ‘anti-anti-suit injunction’ was issued against the OPPO. [16] Then, the Shenzhen court conducted a court investigation to the Sharp’s breach of its ruling and clarified the severe legal consequences of the breach. [17] Eventually, Sharp choose to defer to the Chinese ‘anti-suit injunction’ through voluntarily and unconditionally withdrawing the anti-anti-suit injunction granted by the German court. [18] Interestingly enough, Germany, a typical civil law country, and other EU countries have also seemingly taken a U-turn by starting to issue anti-anti-suit injunctions in international litigation in response to anti-suit injunctions made by other foreign courts, especially the US court. [19]
In some other IP cases involving Chinese tech giants, Chinese courts appear to feel more and more comfortable with granting compulsory rulings having the same legal effects of anti-suit injunction and anti-anti-suit injunction. For example, in another seminal case publicized by the SPC in 2020, Huawei Technologies Corp Ltd (“Huawei”) applied to the Court for a ruling to prevent the respondent Conversant Wireless Licensing S.A.R.L. (“Conversant”) from further seeking enforcement of the judgment rendered by the Dusseldorf Regional Court in Germany. [20] Before the application, a pair of parallel proceedings existed, concurrently pending before the SPC as the second-instance court and the Dusseldorf Regional Court. On the same date of application, the German regional court delivered a judgement in favour of Conversant. Within 48 hours after receiving the Huawei’s application for an anti-suit injunction, the SPC granted the injunction to prohibit Conversant from applying for enforcement of the German judgment; if Conversant failed to comply with the injunction, a fine (RMB 1 million per day) would be imposed, accumulating day by day since the date of breach. [21] Conversant applied for a reconsideration of the anti-suit injunction, and it was however rejected by the SPC eventually. [22] The SPC’s anti-suit injunction against the German regional court’s decision compelled both parties to go back to the negotiating table, and the dispute between the two parties striving for global parallel proceedings was finally resolved by reaching a settlement agreement. [23]
The SPC’s injunction in Huawei v. Conversant is commended as the very first action preservation ruling having the “anti-suit injunction” nature in the field of intellectual property rights litigation in China, which has prematurely established the Chinese approach to anti-suit injunction in judicial practice. [24] It is believed by the Court to be an effective tool to curb parallel proceedings concurrent in various jurisdictions across the globe. [25] We still wait to see Chinese court’s future approach in other civil and commercial matters to anti-suit injunction or anti-anti-suit injunction issued by itself as well as those granted by foreign courts.
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1. See Impala Warehousing and Logistics (Shanghai) Co Ltd v Wanxiang Resources (Singapore) Pte Ltd [2015] EWHC 811, para.144.
2. See Liang Zhao, ‘Party Autonomy in Choice of Court and Jurisdiction Over Foreign-Related Commercial and Maritime Disputes in China’ (2019) 15 Journal of Private International Law 541, at 565.
3. See Article 100, para.1 of the PRC CPL (2017).
4. See Article 51 of the PRC Special Maritime Procedure Law (1999).
5. See Article 53 of the PRC Special Maritime Procedure Law (1999).
6. See Article 56 of the PRC Special Maritime Procedure Law (1999).
7. See Huatai Property & Casualty Insurance Co Ltd Shenzhen Branch v Clipper Chartering SA (2017) E 72 Xing Bao No.3 of the Maritime Court of Wuhan City.
8. See HCCT 28/2017 of the High Court of the Hong Kong SAR.
9. See (2017) E 72 Xing Bao No.3.
10. See Andrew S. Bell, Forum Shopping and Venue in Transnational Litigation (Oxford University Press 2003), at 196.
11. See ibid.
12. See (2020) Yue 03 Min Chu No.689-1.
13. See ibid.
14. See ibid.
15. See ibid.
16. See ibid.
17. See ibid.
18. See ibid.
19. See Greta Niehaus, ‘First Anti-Anti-Suit Injunction in Germany: The Costs for International Arbitration’ Kluwer Arbitration Blog, 28 February 2021.
20. See Huawei Technologies Corp Ltd and Others v Conversant Wireless Licensing S.A.R.L. (2019) Zui Gao Fa Zhi Min Zhong No.732, No.733, No.734-I.
21. See ibid.
22. See Conversant Wireless Licensing S.A.R.L. v Huawei Technologies Corp Ltd and Others, (2019) Zui Gao Fa Zhi Min Zhong No.732, No.733, No.734-II.
23. See Case No.2 of the “10 Seminal Intellectual Property Right Cases before Chinese Courts”, Fa Ban [2021] No.146, the General Office of the Supreme People’s Court.
24. See ibid.
25. See ibid.
A Conflict of Laws Companion – Adrian Briggs Retires from Oxford
By Tobias Lutzi, University of Cologne
There should be few readers of this blog, and few conflict-of-laws experts in general, to whom Adrian Briggs will not be a household name. In fact, it might be impossible to find anyone working in the field who has not either read some of his academic writings (or Lord Goff’s seminal speech in The Spiliada [1986] UKHL 10, which directly credits them) or had the privilege of attending one of his classes in Oxford or one of the other places he has visited over the years.
Adrian Briggs has taught Conflict of Laws in Oxford for more than 40 years, continuing the University’s great tradition in the field that started with Albert Venn Dicey at the end of the 19th century and had been upheld by Geoffrey Cheshire, John Morris, and Francis Reynolds* among others. His writings include four editions of The Conflict of Laws (one of the most read, and most readable, textbooks in the field), six editions of Civil Jurisdiction and Judgments and his magnus opus Private International Law in English Courts, a perfect snapshot of the law as it stood in 2014, shortly before the UK decided to turn back the clock. His scholarship has been cited by courts across the world. Still, Adrian Briggs has managed to maintain a busy barrister practice in London (including well-known cases such as Case C-68/93 Fiona Shevill, Rubin v Eurofinance [2012] UKSC 46, and The Alexandros T [2013] UKSC 70) while also remaining an active member of the academic community regularly contributing not only to parliamentary committees but also, on occasion, to the academic discussion on this blog.
To honour his impact on the field of Conflict of Laws, two of Adrian’s Oxford colleagues, Andrew Dickinson and Edwin Peel, have put together a book, aptly titled ‘A Conflict of Laws Companion’. It contains contributions from 19 scholars, including four members of the highest courts of their respective countries, virtually all of whom have been taught by (or together with) the honorand at Oxford. The book starts with a foreword by Lord Mance, followed by three short notes on Adrian Briggs as a Lecturer at Leeds University (where he only taught for about a year), as a scholar at Oxford, and as a fellow at St Edmund Hall. Afterwards, the authors of the longer academic contributions offer a number of particularly delightful ‘recollections’, describing Adrian Briggs, inter alia, as “the one time wunderkind and occasional enfant terrible of private international law” (Andrew Bell), “the perfect supervisor: unfailingly generous with his time and constructive with his criticism” (Andrew Scott), and “a tutor, colleague and friend” (Andrew Dickinson).
The academic essays that follow are conventionally organised into four categories: ‘Jurisdiction’, ‘Choice of Law’, ‘Recognition and Enforcement of Foreign Judgments’, and ‘Conflict of Laws within the Legal System’. They rise to the occasion on at least two accounts. First, they all use an aspect of Adrian Briggs’ academic oeuvre as their starting point. Second, they are of a quality and depths worthy of the honorand (possibly having profited from the prospect of needing to pass his critical eye). While they all are as insightful as inspiring, Ed Peel’s contribution on ‘How Private is Private International Law?’ can be recommended with particular enthusiasm as it picks up Adrian Briggs’ observation (made in several of his writings) that, so far as English law is concerned, “a very large amount of the law on jurisdiction, but also on choice of law, is dependent on the very private law notions of consent and obligation” and critically discusses it from the perspective of contract-law expert. Still, there is not one page of this book that does not make for a stimulating read. It is a great testament to one of the greatest minds in private international law, and a true Conflict of Laws companion to countless students, scholars, colleagues, and friends.
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* corrected from an earlier version
Enforcement of Foreign Judgments about Forum Land
By Stephen G.A. Pitel, Western University
In common law Canada, it has long been established that a court will not recognize and enforce a foreign judgment concerning title to land in the forum. The key case in support is Duke v Andler, [1932] SCR 734.
The ongoing application of that decision has now been called into question by the British Columbia Court of Appeal in Lanfer v Eilers, 2021 BCCA 241 (available here). In the court below the judge relied on Duke and refused recognition and enforcement of a German decision that determined the ownership of land in British Columbia. The Court of Appeal reversed and gave effect to the German decision. This represents a significant change to Canadian law in this area.
The Court of Appeal, of course, cannot overturn a decision of the Supreme Court of Canada. It reached its result by deciding that a more recent decision of the Supreme Court of Canada, that in Pro Swing Inc v Elta Golf Inc, 2006 SCC 52, had overtaken the reasoning and result in Duke and left the Court of Appeal free to recognize and enforce the German decision (see paras 44-45 and 74). This is controversial. It has been questioned whether Pro Swing had the effect of superseding Duke but there are arguments on both sides. In part this is because Pro Swing was a decision about whether to recognize and enforce foreign non-monetary orders, but the orders in that case had nothing to do with specific performance mandating a transfer or title to land in the forum.
I find it hard to accept the decision as a matter of precedent. The title to land aspect of the foreign decision seems a significantly different element than what is at issue in most non-monetary judgment decisions, such that it is hard to simply subsume this within Pro Swing. What is really necessary is detailed analysis of whether the historic rule should or should not be changed at a normative level. How open should courts be to recognizing and enforcing foreign judgments concerning title to land in the forum? This raises related issues, most fundamentally whether the Mocambique rule itself should change. If other courts now know that British Columbia is prepared to enforce foreign orders about land in that province, why should foreign courts restrain their jurisdiction in cases concerning such land?
In this litigation, the defendant is a German resident and by all accounts is clearly in violation of the German court’s order requiring a transfer of the land in British Columbia (see para 1). Why the plaintiff could not or did not have the German courts directly enforce their own order against the defendant’s person or property is not clear in the decision. Indeed, it may be that the German courts only were prepared to make the order about foreign land precisely because they had the power to enforce the order in personam and that it thus did not require enforcement in British Columbia (analogous to the Penn v Baltimore exception to Mocambique).
Given the conflict with Duke, there is a reasonable likelihood that the Supreme Court of Canada would grant leave to appeal if it is sought. And if not, a denial of leave would be a relatively strong signal of support for the Court of Appeal’s decision. But the issue will be less clear if no appeal is sought, leaving debate about the extent to which the law has changed.
News
Out Now: Aristova, Tort Litigation against Transnational Corporations. The Challenge of Jurisdiction in English Courts
Ekaterina Aristova (Bonavero Institute of Human Rights, University of Oxford) is the author of the ‘Tort Litigation against Transnational Corporations: The Challenge of Jurisdiction in English Courts’ (OUP 2024), which has just been published in the Oxford Private International Law series. She has kindly shared the following summary with us:
The book examines the approach of the English courts to the question of jurisdiction in civil liability claims brought against English-based parent companies and their foreign subsidiaries as co-defendants (e.g., Lubbe v Cape, Lungowe v Vedanta, Okpabi v Shell, etc.). While the book is written from the perspective of English law, the book also draws on examples of similar cases in Australia, Canada, EU Member States, and the US to broaden the discussion.
The assertion of jurisdiction in parent company liability claims based on a nexus with the forum state presents a challenge to the courts. The territorial focus of the adjudicative jurisdiction is often contrary to the transnational nature of cross-border business activities. Transnational corporations (TNCs) have the flexibility to spread operations over multiple jurisdictions and create a legal separation between the subsidiary’s activities and the home state of the parent company. Courts rely on various private international law rules and doctrines to resolve the question of jurisdiction in parent company liability claims, including forum non conveniens doctrine in common law legal systems, the mandatory rule of domicile under EU law, and the presumption against extraterritoriality in US jurisprudence. The broad disparities in the issues of civil jurisdiction among domestic legal regimes and the considerable controversy surrounding the exercise of extraterritorial regulation over corporate operations often lead to the creation of a ‘jurisdictional veil’ for the parent company and a significant degree of autonomy, largely free from the control of any national jurisdiction.
To address this puzzle, this book seeks to answer three questions: 1) To what extent can English courts, under existing rules, exercise jurisdiction over English parent companies and their foreign subsidiaries as co-defendants? 2) Is England a suitable forum for deciding parent company liability claims? 3) Should the jurisdictional competence of the English courts be broadened through a new connecting factor derived from the ‘economic enterprise’ theory?
The book aims to offer a new angle to the discourse by placing the discussion of parent company liability claims in the context of the topical debate about the changing role of private international law in a globalised world. The transnational adjudication of disputes, cross-border activities of non-state actors and expansion of private law-making challenge several conventional assumptions of the discipline of private international law, including its focus on territoriality and geographical connecting factors and its capacity to interact with public mechanisms. Home state courts have become the fora for struggles between TNCs and vulnerable communities from the host states, raising complex questions about (il)legitimate forum shopping, the appropriate forum, and the limits of judicial discretion. Parent company liability claims impact how we think about private international law and its function, and the reader is invited to explore these challenging dynamics.
The Bonavero Institute of Human Rights in Oxford will celebrate the publication of the book by hosting a (hybrid) book launch and wine reception on 5 June 2024.
Registration Now Open: The Hague Academy of International Law’s Winter Courses 2025
Registration for the 2025 programme of The Hague Academy of International Law’s renowned Winter Courses on International Law (6-24 January 2025) is now open. In contrast to the summer courses, this program combines aspects of both Public and Private International Law and therefore provides for a particularly valuable academic experience.
Following the Inauguaral Lecture by Bhupinder Singh Chimni (O.P. Jindal Global University), this year’s General Course in Private International Law will focus on “International Law in the Times of Globalization: Contexts, Networks, Practices” and will be delivered by Mónica Pinto (University of Buenos Aires). Furthermore, Special Courses will be offered in English by Mohamed S. Abdel Wahab (Cairo University), Payam Akhavan (University of Toronto), Enrico Milano (University of Verona) and Catherine Rogers (Bocconi University), while Niki Aloupi and Sébastien Touzé (Paris-Panthéon-Assas) will deliver their presentations in French. As always, all lectures will be simultaneously interpreted into English or French and vice versa. If you are interested in alternative dispute resolution, the lecture on “The Concept of Arbitrator Impartiality” seems particularly interesting.
Advanced Students, especially those who are ambitious to sit for the prestigious Diploma Exam, are highly encouraged to apply for the Academy’s Directed Studies as well. The French edition of these interactive afternoon seminars will be directed by Emanuel Castellarin (University of Strasbourg), while English-speaking candidates are taught by María Carmelina Londoño Lázaro (University of La Sabana).
Registration is open from 1 May 2024 to 1 October 2024 via the institution’s own Online Registration Form . Students who whish to apply for the Academy’s scholarship opportunities need to submit their application by 31 July 2024. For further information on the HAIL 2024 Winter courses and the Academy in general, please consult the HAIL Homepage or refer to the attached PDF Programme.
Job Vacancy at the University of Bonn (Germany): Research fellow in International Civil Procedural Law and/or International Commercial Arbitration
The Rhenish Friedrich Wilhelm University of Bonn is an international research university with a wide education and research profile. With a 200-year history, approximately 33,000 students, more than 6,000 staff, and an excellent reputation at home and abroad, the University of Bonn is one of the most important universities in Germany and is recognized as a university of excellence.
The Institute for German and International Civil Procedure is looking for a highly skilled and motivated PhD candidate and fellow (Wissenschaftliche/r Mitarbeiter/in) to work in the fields of International Civil Procedural Law and/or International Commercial Arbitration on a part-time basis (50%) to start as soon as possible.
(c) Volker Lannert / Universität Bonn
Responsibilities:
- Supporting research and teaching on Private International Law, International Civil Procedure and/or International Commercial Arbitraiton as well as German civil law (required by the Faculty, therefore an excellent command of German and profound knowledge of German civil law equivalent to the “First State Examination” is mandatory)
- Teaching obligation of two hours per week during term time (Semester)
Your Profile:
- You hold the First or Second German State Examination in law with distinction (or its international equivalent)
- If possible, you already had contact with International Civil Procedure Law and/or Commercial Arbitration Law
- You are interested in the international dimension of private law, in particular International Civil Procedural Law, and/or International Commercial Arbitration
- Excellent command of the English language (next to German)
- You are commited, flexible, team-oriented and interested in further professional development opportunities
We offer:
- Varied and challenging assignments with one of the largest employers in the region
- Opportunity to conduct your PhD or research project (according to the Faculty’s regulations) under the supervision of the Director of the Institute Prof Dr Matthias Weller, Mag.rer.publ., MAE
- Occupational pension scheme (VBL)
- Numerous offers of the University Sports Programme (Hochschulsport)
- Easy access to the public transport system and direct road link to the Autobahn due to the central location in Bonn as well as the possibility to use inexpensive parking facilities
- Flexible working hours; remote working options are available
- Renumeration according to German public service salary scale E-13 TV-L (50%); initial contract period is one year at least and up to three years, with an option to be extended.
The University of Bonn is committed to diversity and equal opportunity. It is certified as a family-friendly university. Its goal is to increase the proportion of women in areas where they are underrepresented and to particularly promote their careers. It therefore strongly encourages applications from relevantly qualified women. Applications are handled in accordance with the State Equal Opportunity Act. Applications from suitable persons with proven severe disabilities and persons treated as such are particularly welcome
If you are interested in this position, please send your application (cover letter in German; CV; and relevant documents and certificates, notably university transcripts and a copy of the German State Examination Law Degree) to Prof Dr Matthias Weller (weller@jura.uni-bonn.de).
For additional information, please refer to the attached pdf document (in German) or visit the Institute’s homepage.