Since late 2012, when the two former sub-commissions of China’s International Economic and Trade Arbitration Commission (“CIETAC”) in Shanghai and South China announced they were splitting up and changed their names respectively to Shanghai International Arbitration Center (“SHIAC”) and Shenzhen Court of International Arbitration (“SCIA”), serious concerns and jurisdictional disputes over the application and validity of agreements providing for CIETAC arbitration have surfaced.

As analyzed in our January and March 2015 legal flashes, recent civil rulings have confirmed that SHIAC and SCIA had jurisdiction over disputes on arbitration clauses that respectively designate the Shanghai Sub-Commission and South SubCommission of CIETAC. Although they were not binding, they indirectly reflected the Supreme People’s Court (“SPC”) view on the matter.

On July 15, 2015, the SPC published its Reply to the Request Made by Shanghai’s High People’s Court and Others in Relation to Judicial Review of the Arbitration Awards Issued by CIETAC and its Former Sub-Commissions (the “Reply”), which officially endorses the recent civil rulings and sets out binding guidance for future disputes.

The Reply mainly clarifies the following issues regarding arbitration clauses referred to CIETAC’s former Sub-Commissions:

  1. If the arbitration agreement was entered into before the official name change to SHAIC (on April 8, 2013) or SCIA (on October 22, 2012), SHIAC/SCIA will have jurisdiction over any disputes. Applications to invalidate the arbitration agreement, set aside or resist enforcement of an arbitral award on the grounds of SCIA/SHIAC having no jurisdiction will not be supported by the court.
  2. If the arbitration agreement was entered into after the official name change, or on that same date but before July 17, 2015, CIETAC will have jurisdiction over any disputes, unless the claimant submits the disputes to SHIAC/SCIA, and the respondent does not raise any objections. Subsequent applications to set aside or resist enforcement of an arbitral award on the grounds of SCIA/SHIAC having no jurisdiction will not be supported by the court. 
  3. If the arbitration agreement was entered into on or after July 17, 2015, CIETAC will have jurisdiction over any disputes.

The Reply also clarifies that it will not have retrospective effects (i.e., it will not affect disputes accepted by CIETAC, SHIAC or SCIA before July 17, 2015).

Date of issue: July 15, 2015. Effective date: July 17, 2015.