Can American Court Judgment be enforced in China?

Can American Court Judgment be enforced in China?

Until now, we can say YES, but rare. Please read the case below. This case is the first case.

Wuhan Intermediate court accepted a case of recognizing and enforcing American court judgment, rendered verdict to recognize and execute the judgment issued by Los Angeles Superior court in California, this case is the first case of Chinese court recognized the commercial judgment of American court.

In this case, the applicants Mr. Liu and defendant Tao, Tong, are all Chinese Americans. In July 2014, Los Angeles Superior court in California rendered a default judgment involving share transfer agreement dispute between plaintiff Liu and defendant Tao, Tong who did not attend the court hearing, judged that Tao and Tong reimbursed Mr. Liu 125,000 dollar of share transfer, and assumed the accrued interest and litigation fee. The defendant has real property in Wuhan China, and habitual residence also in there. So, Mr. Liu applied to Wuhan Intermediate court to recognize and enforce the court judgment of America.

China and America have not concluded or jointly participated in any bilateral Judgment recognition and enforcement of civil and commercial international treaty. Before that, Chinese court did not recognize any American judgment according to the doctrine of reciprocity. After Wuhan Intermediate Court reviewed the jurisdiction of American, due notice to defendant, if having precondition of reciprocity of America recognized Chinese judgment, and if violating the fundamental legal principal of Chinese law, or sovereignty, security, social public interest, at last the court rendered verdict to recognize and enforce this judgment.

In conclusion, if you are American company do business with China, it’s not wise to agree jurisdiction in America. In my opinion, arbitration in China is better choice. In China, there are many local and national arbitration commissions. I suggest to choose the national arbitration commissions, such as CIETAC. Arbitrational modal clause, “Any dispute arising from or in connection with this Contract shall be submitted to China International Economic and Trade Arbitration Commission (CIETAC) for arbitration which shall be conducted in accordance with the CIETAC’s arbitration rules in effect at the time of applying for arbitration. The arbitral award is final and binding upon both parties.” If you conduct sea transportation or shipping business, you can choose China Maritime Arbitration Commission (CMAC), Model Arbitration Clause “Any dispute arising from or in connection with this Contract shall be submitted to China Maritime Arbitration Commission (CMAC) for arbitration which shall be conducted in accordance with the CMAC’s arbitration rules in effect at the time of applying for arbitration. The arbitral award is final and binding upon both parties.”