Views
China’s Draft Law on Foreign State Immunity—Part II
Written by Bill Dodge, the John D. Ayer Chair in Business Law and Martin Luther King Jr. Professor of Law at UC Davis School of Law.
In December 2022, Chinese lawmakers published a draft law on foreign state immunity, an English translation of which is now available. In a prior post, I looked at the draft law’s provisions on immunity from suit. I explained that the law would adopt the restrictive theory of foreign state immunity, bringing China’s position into alignment with most other countries.
In this post, I examine other important provisions of the draft law, including immunity from attachment and execution, service of process, default judgments, and foreign official immunity. These provisions generally follow the U.N. Convention on Jurisdictional Immunities of States and Their Property, which China signed in 2005 but has not yet ratified.
China’s draft provisions on immunity from attachment and execution, service of process, and default judgments make sense. Applying the draft law to foreign officials, however, may have the effect of limiting the immunity that such officials would otherwise enjoy under customary international law. This is probably not what China intends, and lawmakers may wish to revisit those provisions before the law is finally adopted. Read more
What is a Judgment (in the context of Reg 655/2014)? – CJEU Case C-291/21 Starkinvest
Less than half a year after the CJEU’s decision in Case C-646/20 Senatsverwaltung für Inneres (discussed here by Krzysztof Pacula), the Court had to engage again with the question of what constitutes a “judgment” in the sense of an EU instrument in Case C-291/21 Starkinvest.
This time, the question arose in the context of Regulation 655/2014 establishing a European Account Preservation Order procedure to facilitate cross-border debt recovery in civil and commercial matters. The regulation envisages two kinds of situation:
- The creditor has already obtained a “judgment” (Art. 7(1)): In this case, the creditor only needs to show that there is an urgent need for a protective measure to ensure that the judgment can be effectively enforced against the debtor.
- The creditor has not yet obtained a “judgment” (Art. 7(2)): In this case, the creditor also needs to show “that he is likely to succeed on the substance of his claim against the debtor”.
In Starkinvest, the claimant had obtained a decision from the Tribunal de commerce de Liège, Belgium, that ordered the debtor to cease seeling certain goods, subject to a penalty payment of EUR 2 500 per breach. On the basis of that decision, they later sought payment of EUR 85 000 in penalties, which they requested the referring court to secure through a European Account Preservation Order. Confronted with the question of how to characterise the initial decision in the context of the above dichotomie, the court referred the case to the CJEU.
International commercial courts for Germany?
This post is also available via the EAPIL blog.
On 25 April 2023 the German Federal Ministry of Justice (Bundesministerium der Justiz – BMJ) has published a bill relating to the establishment of (international) commercial courts in Germany. It sets out to strengthen the German civil justice system for (international) commercial disputes and aims to offer parties an attractive package for the conduct of civil proceedings in Germany. At the same time, it is the aim of the bill to improve Germany’s position vis-à-vis recognized litigation and arbitration venues – notably London, Amsterdam, Paris and Singapore. Does this mean that foreign courts and international commercial arbitration tribunals will soon face serious competition from German courts?
English-language proceedings in all instances
Proposals to improve the settlement of international commercial disputes before German courts have been discussed for many years. In 2010, 2014, 2018 and 2021, the upper house of the German Federal Parliament (Bundesrat) introduced bills to strengthen German courts in (international) commercial disputes. However, while these bills met with little interest and were not even discussed in the lower house of Parliament (Bundestag) things look much brighter this time: The coalition agreement of the current Federal Government, in office since 2021, promises to introduce English-speaking special chambers for international commercial disputes. The now published bill of the Federal Ministry of Justice can, therefore, be seen as a first step towards realizing this promise. It heavily builds on the various draft laws of the Bundesrat including a slightly expanded version that was submitted to the Bundestag in 2022.
The bill allows the federal states (Bundesländer) to establish special commercial chambers at selected regional courts (Landgerichte) which shall, if the parties so wish, conduct the proceedings comprehensively in English. Appeals and complaints against decisions of these chambers shall be heard in English before English-language senates at the higher regional courts (Oberlandesgerichte). If the value in dispute exceeds a threshold value of 1 million Euros and if the parties so wish, these special senates may also hear cases in first instance. Finally, the Federal Supreme Court (Bundesgerichtshof) shall be allowed to conduct proceedings in English. Should the bill be adopted – which seems more likely than not in light of the coalition agreement – it will, thus, be possible to conduct English-language proceedings in at least two, maybe even three instances. Compared to the status quo, which limits the use of English to the oral hearing (cf. Section 185(2) of the Court Constitution Act) and the presentation of English-language documents (cf. Section 142(3) of the Code of Civil Procedure) this will be a huge step forward. Nonetheless, it seems unlikely that adoption of the bill will make Germany a much more popular forum for the settlement of international commercial disputes.
Remaining disadvantages vis-à-vis international commercial arbitration
To begin with, the bill – like previous draft laws – is still heavily focused on English as the language of the court. Admittedly, the bill – following the draft law of the Bundesrat of March 2022 – also proposes changes that go beyond the language of the proceedings. For example, the parties are to be given the opportunity to request a verbatim record of the oral proceedings. In addition, business secrets are to be better protected. However, these proposals cannot outweigh the numerous disadvantages of German courts vis-à-vis arbitration. For example, unlike in arbitration, the parties have no influence on the personal composition of the court. As a consequence, they have to live with the fact that their – international – legal dispute is decided exclusively by German (national) judges, who rarely have the degree of specialization that parties find before international arbitration courts. In addition, the digital communication and technical equipment of German courts is far behind what has been standard in arbitration for many years. And finally, one must not forget that there is no uniform legal framework for state judgments that would ensure their uncomplicated worldwide recognition and enforcement.
Weak reputation of German substantive law
However, the bill will also fail to be a resounding success because it ignores the fact that the attractiveness of German courts largely depends on the attractiveness of German law. To be sure, German courts may also apply foreign law. However, their real expertise – and thus their real competitive advantage especially vis-à-vis foreign courts – lies in the application of German law, which, however, enjoys only a moderate reputation in (international) practice. Among the disadvantages repeatedly cited by practitioners are, on the one hand, the numerous general clauses (e.g. §§ 138, 242 of the German Civil Code), which give the courts a great deal of room for interpretation, and, on the other hand, the strict control of general terms and conditions in B2B transactions. In addition – and irrespective of the quality of its content – German law is also not particularly accessible to foreigners. Laws, decisions and literature are only occasionally available in English (or in official English translation).
Disappointing numbers in Amsterdam, Paris and Singapore
Finally, it is also a look at other countries that have set up international commercial courts in recent years that shows that the adoption of the bill will not make German courts a blockbuster. Although some of these courts are procedurally much closer to international commercial arbitration or to the internationally leading London Commercial Court, their track record is – at least so far – rather disappointing.
This applies first and foremost to the Netherlands Commercial Court (NCC), which began its work in Amsterdam in 2019 and offers much more than German courts will after the adoption and implementation of the bill: full English proceedings both in first and second instance, special rules of procedure inspired by English law on the one hand and international commercial arbitration law on the other, a court building equipped with all technical amenities, and its own internet-based communication platform. The advertising drum has also been sufficiently beaten. And yet, the NCC has not been too popular so far: in fact, only 14 judgments have been rendered in the first four years of its existence (which is significantly less than the 50 to 100 annual cases expected when the court was set up).
The situation in Paris is similar. Here, a new chamber for international commercial matters (chambre commerciale internationale) was established at the Cour d’appel in 2018, which hears cases (at least in parts) in English and which applies procedural rules that are inspired by English law and international arbitration. To be sure, the latter cannot complain about a lack of incoming cases. In fact, more than 180 cases have been brought before the new chamber since 2018. However, the majority of these proceedings are due to the objective competence of the Chamber for international arbitration, which is independent of the intention of the parties. In contrast, it is not known in how many cases the Chamber was independently chosen by the parties. Insiders, however, assume that the numbers are “negligible” and do not exceed the single-digit range.
Finally, the Singapore International Commercial Court (SICC), which was set up in 2015 with similarly great effort and ambitions as the Netherlands Commercial Court, is equally little in demand. Since its establishment, it has been called upon only ten times by the parties themselves. In all other cases in which it has been involved, this has been at the instigation of the Singapore High Court, which can refer international cases to the SICC under certain conditions.
No leading role for German courts in the future
In the light of all this, there is little to suggest that the bill, which is rather cautious in its substance and focuses on the introduction of English as the language of proceedings, will lead to an explosion – or even only to a substantial increase – in international proceedings before German courts. While it will improve – even though only slightly – the framework conditions for the settlement of international disputes, expectations regarding the effect of the bill should not be too high.
Note: Together with Yip Man from Singapore Management University Giesela Rühl is the author of a comparative study on new specialized commercial courts and their role in cross-border litigation. Conducted under the auspices of the International Academy of Comparative Law (IACL) the study will be published with Intersentia in the course of 2023.
News
1st Issue of Journal of Private International Law for 2025
The first issue of the Journal of Private International Law for 2025 was published today. It contains the following articles:
Pietro Franzina, Cristina González Beilfuss, Jan von Hein, Katja Karjalainen & Thalia Kruger, “Cross-border protection of adults: what could the EU do better?†”
On 31 May 2023 the European Commission published two proposals on the protection of adults. The first proposal is for a Council Decision to authorise Member States to become or remain parties to the Hague Adults Convention “in the interest of the European Union.” The second is a proposal for a Regulation of the European Parliament and the Council which would supplement (and depart from, in some respects) the Convention’s rules. The aim of the proposals is to ensure that the protection of adults is maintained in cross-border cases, and that their right to individual autonomy, including the freedom to make their own choices as regards their person and property is respected when they move from one State to another or, more generally, when their interests are at stake in two or more jurisdictions. This paper analyses these EU proposals, in particular as regards the Regulation, and suggests potential improvements.
Call for Papers: The Role of Judicial Actors in Shaping Private International Law. A Comparative Perspective
On the occasion of the 150th anniversary of the Swiss Federal Tribunal, the Swiss Institute of Comparative Law (SICD) is pleased to announce its 35th Conference on Private International Law, to be held on 19–20 November 2025 in Lausanne.
The conference addresses how courts, lawyers, and litigants have shaped—and how they continue to shape—private international law. Special emphasis will be placed on how legal practice drives the development of private international law at both the national and supranational levels. Judges, through landmark rulings, have clarified conflicts of laws rules, set precedents on the recognition of foreign judgments, and adapted legal frameworks to globalization and digital commerce. Lawyers, by crafting novel arguments, have influenced judicial reasoning and contributed to evolving legal doctrines. Finally, strategic litigation, led by litigants and advocacy groups, has driven major jurisprudential shifts, particularly in fundamental rights, corporate liability, and cross-border regulation. The conference will analyse these actors’ distinct but interconnected roles in shaping contemporary private international law.
We invite scholars (both established and early-career researchers), legal practitioners, and policymakers to submit papers addressing these issues.
Possible topics include:
- The role of national and supranational courts in shaping private international law
- The impact of key judicial decisions on cross-border legal relationships
- The influence of legal practitioners in driving jurisprudential change
- Strategic litigation as a tool for legal evolution in private international law
- Comparative approaches to judicial reasoning in international private law cases
- Judicial responses to global challenges such as migration, digital commerce, corporate responsibility, and human rights protection
Paper Submission
Please submit an abstract (up to 500 words) of your proposed paper by 11 May 2025 to Ms. Marie-Laure Lauria (marie-laure.lauria@isdc-dfjp.unil.ch), with the subject line “ISDC 35th PIL Conference Submission“. Abstracts may be submitted in English, German, or French.
All submissions will undergo a double-blind peer review and decisions will be communicated by 3 June 2025. Accepted papers will be considered for publication in an edited volume or a special journal issue.
Organization
The conference will be hosted by the Swiss Institute of Comparative Law.
Funding
The Swiss Institute of Comparative Law will provide funding for the travel costs and accommodation of all presenters.
Crossroads in Private International Law Seminar Series, University of Aberdeen
In April, the Aberdeen Centre for Private International Law and Transnational Governance will be relaunching its Crossroads in Private International Law research seminar series. 
It will feature both online and hybrid events.