China’s first Cyberspace Court was inaugurated on Friday 18 August in Hangzhou, Zhejiang Province. Going forward, this new court will handle all internet-related disputes in all districts of Hangzhou through a fully digitalized, online procedure. The establishment of a specialized cyberspace court in China’s internet capital Hangzhou is an encouraging step for the Chinese internet sector as well as for IP owners: it promises a more flexible procedure and higher quality judgments, handed down by specialist judges.

The new cyberspace court will draw on the existing experience of the Hangzhou courts, including the Court’s predecessor; the pilot e-commerce online tribunal. The courts and tribunal have collectively dealt with the largest – and still growing – number of internet-related cases in China: from 600 cases in 2013 to more than 10,000 in 2016. This large number of internet-related cases is mainly due to the fact that some of China’s largest internet companies are established in Hangzhou: companies such as Alibaba and NetEase have got their corporate headquarters in this metropolis.

The procedure that the new court will employ is not entirely clear, with no official regulations in place as of yet. However, the new cyberspace court will presumably largely follow the procedure used by its predecessor, the pilot e-commerce online tribunal. If this is officially confirmed, then the Cyberspace Court would act like a Basic People’s Court (i.e. judgments can be appealed to the Intermediate People’s Courts) and may accept cases originating throughout Hangzhou. The procedure would be entirely online; from the filing and mediation stage, to the publication of the judgment, and would even include the option to have online video-conference hearings. The bench of the Court would consist of judges that have already obtained experience with internet cases, and the Court will have jurisdiction over:

a) Online copyright disputes (including the unlawful dissemination of films, music and other copyrighted works);

b) Online defamation;

c) Domain name disputes;

d) E-commerce disputes (including purchase contract disputes, product liability disputes, service contract disputes); and

e) Online loan contract disputes.

The first case heard after this official launch was a copyright dispute where the author of a novel sued an online platform operator for making available the novel to the public. It was reported that the hearing was conducted by video-conferencing linking up the respective parties in Hangzhou and Beijing. The transcription was done by voice-recognition technology. The hearing took 20 minutes to finish (the parties agreed to mediate), and the parties simply clicked “Accept” to confirm the transcript.

The Cyberspace Court is hailed as a positive development for China’s e-commerce sector, in which the piracy of copyright works and the sale of counterfeits is still rampant. The Hangzhou Cyberspace Court is considered a pilot project, and more cyberspace courts may be established throughout the country. It is particularly hoped that cyberspace courts may bring the same professionalism to internet-related litigation as the specialized IP Courts did with IP litigation in China.

The practical implications of conducting online procedures before the court are currently unclear. We will keep monitoring this and will advise our clients on the best ways to include the new Cyberspace Court in their China enforcement strategy.