Beijing Arbitration Commission

2019 Toronto Summit on Commercial Dispute Resolution in China Successfully Held

Publish time: 2019-7-15

On 24 June 2019, the “2019 Toronto Summit on Commercial Dispute Resolution in China” (the “Toronto Summit”) jointly hosted by the Beijing Arbitration Commission / Beijing International Arbitration Center (the “BAC”), the Arbitration Place and the ADR Chambers was successfully held in Toronto, Canada.

The Toronto Summit was sponsored by Commerce & Finance Law Offices and Llinks Law Offices. The International Council for Commercial Arbitration (ICCA), the Chartered Institute of Arbitrators Canadian Branch, McGill University, the Toronto Commercial Arbitration Society, the International Dispute Resolution Institute and LexPR have assisted with the preparation of this event as supporting organizations. Meanwhile, as media partners, Global Arbitration Review and Wolters Kluwer also participated in the Toronto Summit.

Since 2018, the change of international economy and trade environment has brought great challenges to market entities within the industrial and commercial circles in China and North America. The increase of uncertainties may have adverse effects on normal business practices and even lead to more disputes. For this reason, the BAC believes it is more necessary to strengthen the cooperation with its North American partners, promote exchanges through dialogue, clarify mutual concerns, better exercise the potential of dispute resolution practitioners, and safeguard the business rules of international trade in practice. In his opening address, Dr. Chen Fuyong, Deputy Secretary General of the BAC was frank about the reasons why Toronto, New York and San Francisco were selected as the three locations of the 2019 North America summits on commercial dispute resolution in China.

Opening address by Dr. Chen Fuyong

The Honorable Barry Leon, FCIArb, former Chief Justice of the British Virgin Islands Commercial Court and representative of the Arbitration Place, said in his opening address that “international commercial arbitration practitioners in history called themselves the merchants of peace when the International Chamber of Commerce was founded in 1919, and commercial arbitration development has promoted international commerce. All the guests sitting in this room would be confident to understand different cultures, to learn about different legal systems, and to hear different voices of practice, and that is what we dispute resolution practitioners regularly do.” He believed that the Toronto Summit will be an excellent forum for exchanges and dialogues between the dispute resolution circles of China and Canada.

Opening address by the Honorable Barry Leon, FCIArb

Mr. Allan J. Stitt, President and CEO of the ADR Chambers, quoted the famous phrase in Spider-Man, “with great power comes great responsibility”, in his opening address, and continued to say that “we cannot be blind to the reasons behind commercial disputes, that can be referred to as the elephant in the room. In addition to settling business cases through arbitration, we should also actively understand each other's concerns from the root through mediation and other ways. Only in this way can disputes be resolved at the source. ” Mr. Stitt believed that the Toronto summit was an opportunity for colleagues in China and Canada to have an in-depth understanding of each other's concerns, which would help resolve disputes that either have arisen or are likely to emerge between the two countries.

Opening address by Mr. Allan J. Stitt

The Toronto Summit consisted of five sessions, including the session on arbitration and mediation themed “Innovative Practice and Guiding Policy in PRC’s Commercial Arbitration and Mediation: Balance between Market and Law”, the session on energy and investment dispute resolution themed “Energy Upgrade and Reforming Investment Environment in PRC: Compliance Challenges and Commercial Risks”, the session on financial dispute resolution themed “Restructuring in the Financial Market of PRC: Addressing the New Economic Environment”, the session on construction dispute resolution themed “Public Supervision and De-administration on Construction Projects in PRC: Quality, Efficiency, and Environment Protection”, and the session on intellectual property rights, film, television and culture themed “Selected Issues of IP & Entertainment Dispute Resolution in PRC”.

During the session on arbitration and mediation, the co-reporters Dr. Wang Xuehua, Partner of Beijing Huanzhong & Partners, and Mr. Fei Ning, Managing Partner of Huizhong Law Firm, and the moderator Ms. Louise Otis, Adjunct Professor of Law School of McGill University, President of the Administrative Tribunal of the Organization for Economy and Cooperation (OECD), the commentator Ms. Louise Barrington, Independent Arbitrator and former founder of the ICC Asia Office, and Prof. Fan Kun, Associate Professor of Law School of McGill University, have discussed many important issues including the establishment of China's International Commercial Court, legislative plans for the amendment to the PRC Arbitration Law and the progress of the Singapore Convention. Indeed, over the past two decades, the internationalization of China's arbitration and mediation is mainly reflected in the adoption of international advanced practices. However, in her comments, Prof. Fan said that the “globalized localism” in China might become a sample of the dynamic of selective adaptations that is also taking place in international arbitration. Examples in this context include the Mainland and Hong Kong Closer Economic Partnership Arrangement and the innovation of a 'one-stop' mechanism at the PRC International Commercial Court. She believed that these Chinese practices well meet the needs of commercial dispute resolution, and will be the catalyst that promotes the integration of Chinese and foreign dispute resolution industries.

Dr. Wang Xuehua

Mr. Fei Ning

Ms. Louise Otis

Ms. Louise Barrington

Prof. Fan Kun

In the session on energy and investment dispute resolution, the co-reporters Mr. Cui Qiang, Partner of Commerce and Finance Law Offices, Mr. Bao Zhi, Partner of Baker McKenzie FenXun, and the moderator Mr. Milos Barutciski, Partner of Borden Ladner Gervais LLP, and the commentators Prof. Janet Walker, Independent Arbitrator and former Vice-President of York University Law School, and Mr. John A. Campion, Partner of Gardiner Roberts LLP, focused on changes in China's energy industry policies, the disputes over arbitrability of energy PPP project contracts and the promulgation of the PRC Foreign Investment Law, as well as the potential influences on compliance requirements from such issues in relevant investment projects. The panelists shared the view that the influence on compliance resulted from changing industry policies constitutes a challenge in arbitration. Arbitrators are expected to be independent from any unilateral positions and short-term interests, and keep an open mind towards different cultures when making analyses and conclusions. As remarked by Prof. Janet Walker, “taking an investment arbitration between the U.S. and Canada under the NAFTA as an example, If Canada and the U.S. both shared a commitment to environmental sustainability, there might have been substantial differences in how the arbitrators viewed subsidy policies for the green energy industry, and accordingly the award might have molded a completely different pattern of the energy industry, and after all it is about environmental change that is relevant to all of us."

Mr. Cui Qiang

Mr. Bao Zhi

Mr. Milos Barutciski

Prof. Janet Walker

Mr. John A. Campion

In the session on financial dispute resolution, the reporter Dr. Tao Xiuming, Partner of JunZeJun Law Offices, introduced China's financial asset management practices in an easy-to-understand way from the historical background of the separate supervision of China's financial industry. In particular, he highlighted the new challenges of financial asset management dispute resolution practice and the new changes in the attitude of the judiciary in an ever-changing regulatory environment. The moderator of the session was Thomas I.A.Allen, Q.C.,FCIArb, former President of the Canadian Accounting Standards Oversight Council, who has worked for several Canadian federal financial regulatory authorities. The commentator of the session was Mr. Marty Sclisizzi, Independent Arbitrator of Baystreet Chambers and former Senior Partner of Bolivar Law Firm. Starting from the Sino-Forest case, they discussed in detail with the Chinese reporter the authorities and obligations of financial institutions in asset management legal relations and the issue of reasonable industry regulation. As pointed out by the two panelists, “in the tradition of case law, precedents helped shape predictable, consistent, and established business and legal rules. That's why Canadian financial institutions are more inclined to choose litigation to resolve disputes." In this regard, Dr. Tao Xiuming pointed out that "In the Chinese financial market, the change and inconsistency of business and legal rules indeed exist, but temporarily. It is a process to crystallize good judgments. In view of China’s actual conditions, arbitration may have more advantages for financial dispute resolution."

Dr. Tao Xiuming

Thomas I.A. Allen, Q.C., FCIArb

Mr. Marty Sclisizzi, FCIArb

Panel discussion

In the session on construction dispute resolution, the reporter Dr. Zhou Xianfeng, Partner of JunHe LLP, made a comprehensive analysis of the influences of deregulation and service optimization in China's construction industry in 2018. Taking the Yin-Yang contract as an example, he focused on analyzing the common legal and compliance risks and causes thereof in China's engineering projects. Moderated by Mr. Cui Qiang, Partner of Commerce and Finance Law Offices, Mr. Stephen Morrison, Independent Arbitrator of Arbitration Place and Founder of The Rose Corporation, mentioned that one of the biggest feelings his company had during the past decade in real estate development and project construction was that the efficiency of dispute resolution was of the most importance. Lengthy dispute resolution procedures could easily bog down parties involved in the project, and even lead to the stagnation of project development and construction and greatly damage the economic value of the project. On this issue, the panelists had further insightful discussion about the application of construction dispute review mechanism and the efficiency of arbitration at the BAC.

Dr. Zhou Xianfeng

Mr. Cui Qiang

Mr. Stephen Morrison

Panel Discussion

In the session on intellectual property rights and film culture, the co-reporters Mr. Hu Ke, Partner of Jingtian & Gongcheng, and Dr. James Tian, Former General Counsel of SK Group China, the moderator Mr. Patrick Zheng, Partner of Llinks Law Offices, and the commentator Mr. John Keefe, Independent Arbitrator of John Keefe Chambers, deliberated on the judgment strategies in Chinese litigation and arbitration and the innovation of relevant judging standards in the context of a rapid developing market of intellectual property rights and film culture. Mr. Keefe thought that, in terms of intellectual property rights and film culture, perhaps more important at the moment is how to fully understand the technical/industrial issues in specific disputes. Fact-finding is the precondition for the arbitrator to adjudicate fairly and reasonably. The problem can be solved by having the arbitrator re-learn the technical knowledge in an individual case, or by recruiting a technical expert as the arbitrator. But, he went on to remind that “the purpose of arbitration is to affect the speedy resolution, not to enrich the people who are involved”. This might better adapt to the development trends of the two industries.

Mr. Hu Ke

Dr. James Tian

Mr. Patrick Zheng

Mr. John Keefe

When all the sessions of the Toronto Summit have finished, The Honourable William Ian Corneil Binnie, Q.C., former Deputy Minister of Justice for Canada and former Chief Justice of the Supreme Court of Canada, delivered the concluding remarks. He recalled, "Years ago, the Vice President of the PRC Supreme People's Court, during his visit to us, described the efforts made by Chinese courts to orchestrate and better organize and deliver more predictable justice in commercial disputes. The discussions today convinced me that in fact this is an ongoing trying. Even though there are very major differences between the Chinese and the Canadian legal systems, the panel discussions in this event told us that we're dealing with comparable concepts at bottom with respect to those basic values of law, such as certainty, predictability and consistency.” At the end of his speech, The Honorable Barry Leon borrowed an old Chinese expression and said that “let a thousand flowers bloom, and let's have all the interpretations out there that are reasonable, and let's not intervene to try to impose an order. In this regard, I look forward to another summit held by the BAC here in Toronto in 2020.”

The Honourable William Ian Corneil Binnie, Q.C.

A number of innovations were seen in the Toronto Summit, from the preparation process, to the design of panel discussion sessions, and to the overall organization and publicity. The BAC team has shown its strong coordination and organization capabilities in full compliance with international standards, and has won high praises from all partners. The audiences not only listened carefully and gave questions actively, but also had in-depth exchanges on the business environment and dispute resolution in China during coffee breaks and the cocktail party.

Questions from and exchanges between audiences

As Prof. Fan said in her speech, "For those who are familiar with Beijing, imagine you're walking along the Chang’An Avenue, which is the heart of the city. You look straight forward that the Forbidden City, the remembrance of China's imperial history, and in front of this as Tiananmen Square, a symbol of China's recent history. And on the left, you see the Great Hall of the People where legislators pass today's law, and you look further west, there is a building full of modernity, perfectly integrating with China's historical and symbolic monument. That's a national grand theater designed by a French architect. And I think that might well echo the future of transnational arbitration, the coexistence of the historical and contemporary and the coexistence of the East and the West." Perhaps the international environment is ever-changing and unpredictable, as a leading arbitration institution in China, however, the BAC will never forget its original ambition as a "commercial peacemaker" and continue to work with its partners worldwide to promote the deep integration of the theories and practices of dispute resolution in different jurisdictions, and ultimately realize its vision of effectively resolving disputes and promoting business development.

Group photo of speakers at the Toronto Summit

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All disputes arising from or in connection with this contract shall be submitted to Beijing Arbitration Commission / Beijing International Arbitration Center for arbitration in accordance with its rules of arbitration. The arbitral award is final and binding upon both parties.
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