Legal Translation and Tips
for Preventing and Managing
Commercial Disputes in China

Chinese to English Legal Translation Services for Litigation

Chinese translators and Chinese to English interpreting services by court-certified Chinese deposition interpreters provide highly needed legal translation and legal interpreting services, as U.S. companies often find themselves in disputes with Chinese companies, individuals, and even the Chinese government.  Many people, including lawyers, do not realize that filing a lawsuit and obtaining a judgment against a Chinese company or individual from a U.S. court is almost never worth the paper it is written on. Simply put, China does not (and never has), enforced U.S. Judgments.

Since China has not ratified any treaty requiring it to honor U.S. judgments, China can essentially ignore judgments by U.S. Courts and act however it pleases. Accordingly, the odds of actually recovering any money in a lawsuit against a Chinese company are slim to none.

So what can be done to avoid becoming an automatic loser in a dispute with a Chinese company or individual? First, consider including a provision in the contract requiring all disputes to be resolved in China according to Chinese law. As discussed above, while a provision stating that all disputes shall be resolved in the U.S. might seem like a good idea, in reality, it is unlikely to result in an enforceable judgment.

Next, decide how you would prefer disputes to be handled. Normally, commercial disputes with a foreign company or individual are resolved in one of the following ways: by negotiation, arbitration, or litigation. Many business contracts involving Chinese companies contain a clause whereby the parties stipulate to attempt to negotiate the dispute before employing other, more costly methods of dispute resolution. This not only saves time and unnecessary legal fees, but requires the parties to communicate before they litigate. If the dispute cannot be resolved by negotiation, the contract could require the parties to arbitrate their dispute. The China International Economic and Trade Arbitration Commission (CIETAC) or the China Maritime Arbitration Commission (CMAC) (for maritime disputes) are two arbitration bodies sponsored by the Chinese government that can be utilized to resolve disputes when one of the parties is domiciled outside of China.

Headquartered in Beijing, CIETAC has a number of sub-commissions located throughout China. Each of the sub-commissions adopts the same set of Arbitration Rules and the same Panel of Arbitrators. Interestingly, for disputes resolved by CIETAC, the parties may select the nationality of the members on the arbitration panel ahead of time and include that in the contract. If the contract does not include provisions regarding the nationality of the arbitrators, CIETAC has published rules governing the selection of arbitrators and has many non-Chinese arbitrators available to assist in dispute resolution. According to CIETAC’s website, “CIETAC’s over 20,000 concluded arbitration cases have involved parties from more than 70 countries and regions outside the Chinese mainland, and its awards have been recognized and enforced in more than 60 countries and regions.”

Another way to resolve disputes is by litigating in a Chinese court. Foreign individuals, as well as foreign companies, can file lawsuits in Chinese courts just as Chinese citizens and companies can. The downside of litigating in a Chinese court, however, is that court rulings, like in the U.S., are subject to appeal, increasing the likelihood that the litigation will drag on for years. In addition, judges in China are often not well-educated, whereas the members of arbitration panels are typically experts in their field.

Of course, any contracts with Chinese businesses or individuals invoking Chinese law should be written in Chinese and then, of course, translated into English for your own understanding. All Language Alliance, Inc. provides professional legal translation and legal interpreting services for contracts and other legal documents involving U.S. and Chinese entities.

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