The Dream Factory of China

Source :Qianhai Communication Center

Hong Kong laws have been applied in the ruling of a commercial case involving a Hong Kong businessperson at the Qianhai Cooperation Zone People’s Court, marking a step forward in the convergence of the laws of the Chinese mainland, Hong Kong and Macao during the construction of the Guangdong-Hong Kong-Macao Greater Bay Area.

According to Wang Chaojie, the attorney representing the Hong Kong litigant, whose name wasn’t disclosed, they chose to file the case with the Qianhai court where extraterritorial laws are applicable for its higher efficiency and lower cost compared to that in Hong Kong.

Ma Zhanju, the judge in the case, said the practice of applying extraterritorial laws in commercial cases involving overseas litigants makes them more assured when investing on the Chinese mainland.

Ma said the basic principles of commercial laws and regulations of most countries are the same, although there are differences in specific content such as the amount of compensation. “As many overseas investors might not be familiar with mainland laws, they tend to make the application of extraterritorial laws stated in their investment contracts.”

Founded in January 2015, the Qianhai court has been piloting China’s comprehensive judicial reform. The court has jurisdiction over all first-instance foreign, Hong Kong, Macao and Taiwan-related commercial cases within Shenzhen.

Wen Changzhi, president of the Qianhai court said that over the past six years, the court has rolled out a series of measures to promote the application of extraterritorial laws, including building a national extraterritorial law ascertainment and research base, constructing a database of Hong Kong, Macao, Taiwan and foreign laws and cases, and formulating guidance on the ascertainment of extraterritorial laws and Hong Kong-related factors.

Official statistics show that the court has heard 10,145 foreign, Hong Kong, Macao and Taiwan-related commercial cases from February 2015 to October this year. Among them, 7,078 involved Hong Kong litigants. Hong Kong laws were applied in 85 of the 7,078 cases.

“Applying extraterritorial laws is conducive to help overseas litigants eliminate the uneasiness caused by system differences and further strengthen the economic exchanges in the Guangdong-Hong Kong-Macao Greater Bay Area and that between China and the world,” Wen said.