The Validity of Arbitration Agreements Providing for Arbitration in Mainland China Administered by Overseas Arbitration Institutions

Abstract

With China increasingly opening up in relation to trade, the number of overseas arbitration institutions practicing in China’s free trade zones is expected to rise. At the same time, however, the validity of arbitration agreements remains uncertain under Chinese arbitration law, with arbitration clauses which tend to permit administration only by domestic arbitration commissions. Chinese arbitration legislation and recent cases demonstrate that this issue can be attributed to difficulties identifying a designated arbitration commission or tribunal, as well as unclear standards to determine the nationality of the arbitration award. Considering relevant decisions of Chinese courts over the past twenty years, this article concludes that the attitude of the Chinese judiciary towards arbitration by overseas arbitration institutions in China has shifted from conservative to more open. However, a number of issues, including confusion around the arbitration jurisdiction (caused by absence of a requirement to specify the arbitration institution) make this area a difficult one for practitioners. overseas arbitration institutions, the validity of arbitration agreement, free trade zone, the seat of arbitration, the New York Convention