I recently handled a query from the legal department of a UK-based company, a situation that highlights a frequent procedural difficulty in the enforcement of international judgments. The UK company had successfully sued a Chinese company’s UK subsidiary and its Chinese parent entity in a UK court and obtained a favorable judgment. The current challenge they face is the practical matter of enforcing this judgment in China. The first step in the enforcement process—serving the relevant legal documents on the China-based respondent—is a statutory prerequisite for initiating the entire judicial proceeding. However, it is precisely this service step, due to its specialized and complex nature, that has become a common stumbling block for many overseas parties seeking judicial relief in China.
China offers a powerful legal avenue for enforcing foreign court judgments. Yet, its legal system, grounded in the principle of national sovereignty, treats court judgments as territorial. This means that a judgment from courts in New York, London, or Tokyo does not automatically carry legal weight within China. To be effective, it must undergo a formal review and approval process by a Chinese court. Rather than merely outlining statutes, here I will provide a practical and strategic roadmap. From defining what qualifies as an enforceable judgment under Chinese law, to navigating treaties and reciprocity principles, and anticipating possible defenses, this analysis equips you with the knowledge to approach enforcement confidently.
I. Eligibility: Which Judgments Can Be Enforced in China?
Before initiating enforcement, it is vital to confirm that your judgment meets China’s strict legal criteria. The definitions of “foreign court” and “judgment” carry specific nuances that may differ from those in your home country.
Defining the Foreign Court
Chinese law takes a broad, functional view of what constitutes a foreign court. It looks to the foreign country legal system to determine whether the issuing body is recognized as a judicial or competent authority under its own laws. For example, in the UK, institutions like the former House of Lords and the Judicial Committee of the Privy Council are judicial bodies. In some civil law countries, such as Poland, notaries have quasi-judicial authority over minor civil matters. This broad interpretation is reflected in China bilateral judicial assistance treaties, which often refer to courts or other competent authorities. Therefore, the first step is to assess the legal status of the issuing institution.
Nature of the Judgment
The judgment must be civil or commercial in nature. Chinese courts generally do not recognize or enforce penal or administrative judgments due to their public law characteristics. For instance, criminal judgments for fraud are not enforceable, though civil components of criminal judgments—such as compensation orders—may be separately enforced.
Additionally, the judgment must be final and conclusive, addressing the substantive rights and obligations of the parties. Judgments pending appeal or interlocutory rulings are not considered final. Chinese courts determine finality based on the law of the issuing country. The Civil Procedure Law refers to judgments and rulings that have taken legal effect, which includes enforceable decisions or orders but excludes procedural orders like preliminary injunctions or freezing orders.
II. Starting the Process: Preparing Your Application
Once your judgment qualifies, the next step is to prepare and submit a detailed application to a competent Chinese court. Precision is critical, as procedural errors can cause delays or rejection.
Your application must include:
- A formal written request for recognition and enforcement, detailing the identities of both parties, the foreign court name, judgment specifics, the relief sought, and the legal and factual basis for your claim.
- Comprehensive information about the respondent assets in China and their locations, as well as any enforcement efforts made outside China. This asset information is essential for successful enforcement.
Supporting documents must include:
- A certified or court-verified copy of the original judgment.
- Proof that the judgment is final and legally effective in the country of origin.
- If the judgment was rendered in absentia, evidence that the absent party was properly served.
All foreign-language documents must be professionally translated into Chinese by a qualified agency with an official seal. Documents executed abroad must be legalized, typically through notarization and authentication or an Apostille under the Hague Convention, to which China is a party.
III. Legal Foundations: Treaties and Reciprocity
Chinese courts review enforcement applications based on either an applicable international treaty or, absent a treaty, the principle of reciprocity, as outlined in Article 299 of the Civil Procedure Law.
Treaty-Based Enforcement: The Preferred Route
Bilateral judicial assistance treaties offer the most reliable and predictable framework for enforcement. China has not yet ratified major multilateral conventions like the Hague Convention on Foreign Judgments but has established bilateral treaties with about 40 countries, 38 currently in effect, 35 of which include provisions for judgment recognition and enforcement. These treaties define enforceable judgments, grounds for refusal, and procedures, forming the basis for most successful enforcement cases.
For example, in a 2009 dispute between a Chinese and a Polish company, the Chinese court applied the Sino-Polish treaty to uphold a Polish judgment despite a statute of limitations defense, demonstrating the treaty practical strength.
Reciprocity: A Flexible Alternative
When no treaty applies, Chinese courts rely on reciprocity, reflecting sovereign equality. This principle has several forms:
- De Jure Reciprocity: A legal assessment of whether Chinese judgments would be recognized abroad under similar laws.
- De Facto Reciprocity: Based on actual instances where foreign courts have recognized Chinese judgments, as in a case involving South Korea.
- Reciprocity Commitment: Diplomatic assurances by foreign countries promising future reciprocal enforcement, such as China 2019 commitment to Azerbaijan.
- Presumed Reciprocity: A proactive approach where China extends judicial assistance first to certain countries, fostering reciprocal relations, exemplified by agreements with ASEAN countries and Singapore.
IV. Potential Challenges: Grounds for Refusal
Even with a valid application and legal basis, enforcement may be denied on specific grounds:
- Lack of Jurisdiction: If the foreign court lacked proper jurisdiction or violated exclusive jurisdiction rules or valid choice-of-court agreements.
- Procedural Unfairness: If the respondent was not properly served or denied a fair chance to present their case.
- Fraud: Judgments obtained through fraud will not be enforced.
- Conflicting Judgments: If a Chinese court has already ruled on the matter or recognized another foreign judgment or arbitral award on the same dispute.
- Violation of Public Policy: Enforcement will be refused if it contradicts fundamental Chinese legal principles, sovereignty, social security, or morality.
- Excessive Punitive Damages: Chinese law allows only compensatory damages. Excessive punitive damages, common in U.S. judgments, will be reduced or excluded during enforcement.
V. Procedural Steps in Chinese Courts
After filing, the application and documents are served on the respondent, who has 15 days (if domiciled in China) or 30 days (if not) to submit a defense. Jurisdictional challenges can be raised and appealed. Applications are filed with an Intermediate Court, with venue options including the respondent’s domicile, property location, or the applicant’s domicile, allowing strategic choices. You may also request property preservation measures—such as freezing bank accounts or seizing assets—to secure recovery, typically requiring a bond and detailed asset information. The court ruling on enforcement takes effect immediately upon service. Appeals are limited; dissatisfied parties have 10 days to request reconsideration by a higher court.
Conclusion: A Strategic Priority for Global Clients
Enforcing foreign judgments in China is a complex process requiring deep legal insight and strategic planning. While challenges exist—from jurisdictional issues to public policy concerns—the expanding network of treaties and evolving reciprocity principles reflect China’s growing commitment to international judicial cooperation. For international brand owners, mastering this process is essential to ensuring that intellectual property rights and commercial agreements are effectively upheld in China. Success depends on thorough preparation, understanding Chinese legal nuances, and adopting a proactive strategy. With expert guidance, the critical final step—turning a foreign judgment into enforceable recovery in China—can be confidently achieved.