Mainland China to Expand the Scope of Judicial Recognition on Taiwan’s Civil Judgments and Arbitral Awards

On June 30^th, 2015, the Supreme People’s Court of China announced two judicial interpretations: the “Supreme People’s Court’s Regulations on Recognition and Enforcement of Civil Judgments Made by the Courts of Taiwan” and the “Supreme People’s Court’s Regulations on Recognition and Enforcement of Arbitral Awards Made by the Courts of Taiwan” (hereinafter "the new Regulations"). The two regulations consist of 23 and 22 Articles respectively and entered into force two days later on July 1^st, 2015.

As early as 1998, the Supreme People’s court promulgated the first judicial interpretation regulating matters of judicial recognition of Taiwan’s civil judgments. Subsequently, additional interpretations were published successively between 1998 and 2009. The same idea was further echoed in 2012 when Taiwan and Mainland China signed the “Cross-Strait Agreement on Jointly Crack-Down on Crimes and Judicial Assistance,” where both parties agreed to mutually recognize and enforce civil judgments and arbitration decisions based on reciprocity under circumstances that no public orders and morals are undermined. [1]

Regrettably, due to the lack of a uniformed interpretation of the laws and regulations in different levels of courts in China, cases of Taiwan seeking recognition may be treated differently by Chinese courts. For example, seeking recognition of a mediation transcript issued by a Taiwan township mediation committee in China was a question.

The new Regulations unify the scope of judicial recognition and further improve its relevant procedures. Highlights of the new Regulations are summarized as below:[2]

1.       Exclusive Jurisdiction: In the old Regulation a court for accepting an application for recognition is an intermediate people’ s court or a specialized court where the applicant’s residence or frequent domicile is located. The new Regulations added more accepting forums to include an intermediate court where the respondent’s residence, frequent domicile, and properties are located.

2.       Enlarged scope of recognition: In the previous Supreme People’s Court’s supplemental Regulations on Recognition of Civil Judgments Made by Courts of Taiwan of 2009, the scope of judicial recognition includes civil judgments, civil adjudications, settlement transcripts, mediation transcripts, payment orders, and arbitral awards. Compared to the old regulation, the two new Regulations now further comprises recognition of decisions of damages award and settlement transcripts in the ancillary civil action along with the criminal procedure, as well as the mediation transcripts in a criminal case. A mediation transcript issued by a Taiwan township mediation committee, and is endorsed by a Taiwanese court, is also eligible for recognition.  

3.       Simplifying the Procedure: The procedure for court decisions to be notarized first in Taiwan and then authenticated later in China is now cancelled. This procedure was previously required before an application for recognition be accepted by a court in China

4.       Power of Attorney: Notarization of power of attorney in the applicant's place of origin can be waived if an applicant (including foreign applicants) executes a power of attorney before a judge of the People's court, or executes the document in China before a Chinese notary public.

5.       Due Process: A People’s court which accepts an application for recognition shall, as required in the new Regulations, docket the case within seven (7) days upon receipt of the application. The court shall subsequently notify the applicant and the respondent, and send a copy of the application to the respondent. The decision of non-acceptance shall also be issued within seven (7) days if the Chinese court does not have a jurisdiction or the application does not conform to the formality requirement.

6.       Remedies: There was no remedies in the old Regulation whatsoever. The new Regulations stipulate that, upon issuance of a decision regarding an application for recognition, either the applicant or the respondent may petition for a review to a court of upper level regardless the decision is made to recognize, reject, or dismiss a case.

7.       Statutory Limitation: The time period in which an applicant can apply for recognition and enforcement is specified as two years since the judgment or decision is made or issued.  

Since civil judgments include commercial and intellectual property cases, right holders who have obtained a judgment from the Taiwan IP Court may find an additional route to enforce their IP rights and realize the damages award in China.