Evaluation of execution of arbitral awards in China's economically less-developed regions

Abstract

This study looks into the execution of arbitration awards in economically less-developed regions of the People’s Republic of China, aiming to update understanding of the execution status and problems hindering execution practices in the foregoing regions. Aside from reviewing secondary materials and published scholarly contributions, five methods, including collection of statistics from two intermediate courts and two arbitration commissions, survey by questionnaire, semi-structured interview, group interview and participant observation, were deployed to generate first-hand data in this study. Specifically, two provinces in China were chosen as the targets for study, while the interviewee pool consisted of eleven judges, thirteen lawyers, one senior official from an arbitration commission, two creditors and two professionals from different private debt collection agencies. Relying on the collected statistics and experience-based data, this study manages to depict the real-life execution of arbitral awards and general perceptions of commercial arbitration amid China’s legal community in the studied regions. Eight problems, namely, difficulty in asset tracking, inefficiency of judges, defaults of debtors, heavy burden of creditors, the influence of Chinese culture, flaws in China’s legislative framework, and poor quality of arbitral awards, are diagnosed as issues possibly constituting obstacles to execution. This study also unveils the role of the hitherto under-addressed private collection agencies in China’s current execution practices, highlighting their strengths and weaknesses, through comparing their operations against those of the other two collection forces, namely, courts and lawyers. Moreover, this study exposes the impacts of China’s cultural heritage (i.e. ideologies concerning Li, De and He) and modern values (like worshipping money) on shaping Chinese parties’ legal awareness and execution-related behaviours. Finally, based on the outcomes of previous discussions, this study generates several suggestions on improving the general execution status in China respectively for the consideration of Chinese authorities and judicial force.