Digital Commons Network^™

The Perils Of Foreign Contracating In China, Debra J. Reed

Debra J Reed

QUESTION PRESENTED

Whether a business contract executed between a foreign party and a Chinese party is enforceable in the courts of the People’s Republic of China?

BRIEF ANSWER

Probably not. Foreign party reliance on Chinese courts to enforce their contracts is premature because China is not yet a rule of law country. Chinese courts do not exercise judicial independence. Political domination by the Chinese Communist Party, CCP, over the courts, and Chinese local protectionism both influence the outcome of cases. Moreover, the Chinese legal system is wrought with corruption. Because inexperienced judges adopt new laws at varying speeds and apply …