Beijing Arbitration Commission

2012 Work Summary of Beijing Arbitration Commission (BAC)

I am so glad to make 2011 work report as entrusted by the Beijing Arbitration Commission (the BAC) which mainly consists of six parts:

I. Work performance in 2012

(I) Arbitration case handling

1. The number and type of cases accepted in 2012 were rather stable with the subject matter amount declined to some extent

In 2012, BAC had accepted 1,473 cases in total, with the subject matter at the value of 6.3 billion Yuan and the average subject matter amount of each case was 4,261,400 Yuan. The number of cases was 2 more than 2011, which was rather stable; however, the amount of subject matter was 5.6 billion Yuan less than 2011. On the subject matter amount of single case, the number and subject matter amount of the cases at the value of less than 100 million Yuan remained unchanged: 1,088 cases at the value of less than 1 million Yuan, 320 million Yuan in total; 365 cases at the value of between 1 million Yuan and 10 million Yuan, 1.22 billion Yuan in total; 95 cases at the value of between 10 million Yuan and 100 million Yuan, 2.76 billion Yuan in total. There were 12 cases at the value of over 100 million Yuan in 2012, 4 less than 2011, 2 billion Yuan in total, a decrease of 6 billion Yuan compared to 2011.

On types of disputes, the disputes on sales contracts were 470, accounting for 31.91%; commission disputes were 330, accounting for 22.40%; disputes on construction engineering contracts were 234, accounting for 15.89%; disputes on investment and finance were 128, accounting for 8.69%; leasing contract disputes were 100, accounting for 6.79%; disputes on loan and guarantee contract were 56, accounting for 3.80%; new type of contract disputes such as franchising and tourism were 36, accounting for 2.44%; disputes on contracts for hired work were 35, accounting for 2.38%; information internet disputes were 17, accounting for 1.15%; technical contract disputes were 16, accounting for 1.09%; guarantee contract disputes were 15, accounting for 1.02%; intellectual property disputes were 10, accounting for 0.68%; other disputes were 26, accounting for 1.77%. Compared with the case types in the previous years, it could be seen that the top 5 disputes are basically sales contract, commission contract, construction engineering contract, investment and financial contract and leasing contract. We have maintained the strength in traditional areas; however, we need to publicize more and create new growth point in newly emerging markets.

2. The number of international commercial arbitration case declined dramatically compared to last year, but the domestic cases involving the parties in other places increased greatly

The international commercial arbitration cases accepted in 2012 were 26, 12 less than that in 2010, a decline of 31% and accounting for 1.75% in total cases. Up to the end of last year, the international commercial arbitration cases as accepted by BAC were 494, accounting for 2.42% in total cases.

Among the domestic cases, there were 666 cases in which one party or both parties concerned was or were in other places, 63 more than that in 2011, up by 10.45% and accounting for 46.03%. Among these, there were 139 cases in which both parties concerned were in other places, 20 more than that in 2011, up by 16.81% and accounting for 9.61%. It showed that BAC’s influence nationwide had been improved gradually.

3. The cases concluded and settled maintained a higher level in 2012

There were 1,563 cases concluded in 2012, with the rate of 106.11%. Among the cases concluded, the cases by arbitration were 822, accounting for 52.59%; cases by mediation were 275, accounting for 17.59%; the cases withdrawn by the parties concerned were 464, accounting for 29.69%; and the cases withdrawn by BAC were 2, accounting for 0.13%.

4. The case conclusion efficiency in 2012 remained higher level

Ended at the end of 2012, the average time from forming the arbitration tribunal to case concluding was 96 days, maintaining a higher efficiency. Due to the error of case handling system, the statistics data on case concluding time previously was not accurately; therefore, we had redeveloped the case handling system in 2012 and sorted out and corrected the data.

5.The judicial supervision environment on arbitration was generally good in 2012 with less arbitration cases cancelled or not to be executed

There was 1 case to be canceled subject to court order in 2012 and 4 cases were refused to be executed, 5 in total, accounting for 0.32% of the total. The 4 cases were refused to be executed by court in other places with the cause of “insufficient main evidences on fact identification”. We had reflected to the local supreme people’s court and supreme people’s court. Generally speaking, there were a few cases to be cancelled or not to be executed, which was benefited from that we had been always emphasizing the standardization and professionalism of case handling and some supporting training activities on one hand, and on the other hand, we had been always insisting on actively communicating with the court. By the way, the number of cases canceled and not to be executed was not the only standard to measure the case quality. What we are always pursuing is to do perfectly and make the award being respected and accepted by the both parties so as to meet the requirements of both parties on fair award.

6. The proportion of arbitrators handling the cases had further increased

There were 269 arbitrators handling the cases in 2012, 23 more than that in 2011. The arbitrators handing the case accounted for 68.80% in total (such proportion would be 91.5% taking the arbitrators in mainland China as the base).

(II) Revenue and Tax Payment of BAC

In 2012, the revenue of BAC was 65.4884 million Yuan (among which the arbitration revenue was 57.1165 million Yuan, the house rental and other revenue was 4.4232 million Yuan and capital financial profits were 3.9487 million Yuan) and the tax payment was 16.2844 million Yuan. Up to the end of 2012, the taxes paid by BAC were 129 million Yuan, 29 times of financial appropriation at the beginning of BAC establishment.

(III) Leadership transition and arbitrator employment of BAC

On September 28, 2012, BAC completed the leadership transition. Prof. Liang Huixing shall be the director of 6th arbitration commission, and Zhou Jidong, Wang Hongsong, Che Pizhao and Zhou Tianyong are vice directors, including other ten members. The secretary general of BAC is Lin Zhiwei. On October 12, 2012, the 6th arbitration commission held the meeting and announced that BAC’s leadership transition had been completed successfully.

The 6th arbitration commission employed 391 arbitrators in total. On education, there are 133 arbitrators with doctor degree, accounting for 34%; 160 arbitrators with master degree, accounting for 41%; and 98 arbitrators with bachelor degree, accounting for 25%. On specialty distribution, there are 82 arbitrators engaged in law and economic trade teaching and study, accounting for 21%; 117 arbitrators engaged in economy and trade, accounting for 30%; 115 arbitrators being as the lawyers, accounting for 29%; 24 arbitrators as the judges previously, accounting for 6%; and 53 arbitrators engaged in other legal affair works, accounting for 14%. On nationality, there are 293 arbitrators in mainland China, accounting for 75%; 17 arbitrators from Hong Kong and Taiwan, accounting for 4%; and 81 foreign arbitrators, accounting for 21%.

(IV) The fundamental works such as research, training and publicity and promotion

In 2012, BAC had put more efforts on research, training, communication, publicity and promotion, and done well in fundamental work, which had achieved fruitful achievements, mainly including:
About research
Firstly, carrying out the special study on relevant field: 1. The arbitrator professional teams continued their activities in 2012, mainly studying the difficult points and hot issues in their field and the difficult cases. 2. Participated in study and drafting the guidance of Beijing supreme people’s court on judicial review and construction engineering dispute hearing; 3. Compiled Explanations to Typical Cases on Regulations for Implementing Law on Public Tendering with China University of Political Science and Law; 4. Conducted special study on legal issues such as affiliation and twin contracts, etc. with Beijing Municipal Construction Commission; 5. Conducted the communication discussion with the relevant departments of the courts in Beijing regarding juridical supervision, arbitration case perseverance and execution, construction engineering case hearing, etc.; 6. Actively participated in amendment to civil procedure law, affecting law makers to revise the provisions adhering to the principle of supporting arbitration; 7. Prepared arbitrator career development report of law development report in China, drafted the research report of “Greatly Develop Commercial Arbitration and Build the International Arbitration Center” and reported to the municipal government, participated in editing and publicizing the Process Report on the Rule of Law in Beijing; 8. Co-organized the internal seminar on “Harmonious Processing Significant Public Event & Experience and Enlightenment from Handling Oil Spill in Gulf of Mexico” with strategy instate of Communist Party School and invited the relevant department leaders and senior experts from supreme people’s court, Ministry of Agriculture, Ministry of Environment Protection, Ministry of Housing and Urban-Rural Development, Legal Affairs Office of the State Council and Policy Research Office of the State and State Council. After the seminar, Xinhua News Agency reported to members of political bureau of the CPC Central Committee, State Council and departments of State Council in the form of internal reference. We have drafted the report titled “Some Considerations on Handling with Significant Public Events such as ConocoPhillips Oil Spill” with the professors of Political Law Department of Party School and submitted to the relevant State Council departments and leaders.

Participating in study and drafting the guidance of Beijing supreme people’s court on judicial review and construction engineering dispute hearing

Assisting China Engineering Cost Association with drafting Identification Procedure on Construction Engineering Cost

Preparing arbitrator career development report of law development report in China, drafting the research report of “Greatly Develop Commercial Arbitration and Build the International Arbitration Center” and report to the municipal government, participating in editing and publicizing the Process Report on the Rule of Law in Beijing

Participating in editing and publicizing the Process Report on the Rule of Law in Beijing

Secondly, conducting the study on BAC cases: 1. Organized to analyze and compile the existing awards and cases, mainly including engineering construction, equity transfer, loan guarantee and insurance, etc.; 2. Study on major proceeding issues on arbitration based on case handling practice, including making summary and analysis of interlocutory award, studying the re-arbitrated issues, etc.; 3. Made summary and analysis of the awards cancelled and not to be executed by the court and draft the opinion analysis.

Thirdly, strengthen the business studies of office staff: 1. continued to edit and publish Volume 4 of Beijing Arbitration; 2. Continued to hold “seminar” among the personnel, 35 times in total in the whole year. At present, it is the time to transform the seminar into study achievement.

About Training
Firstly, intensify the requirements on self training of the arbitrators.
Firstly, intensify the requirements on self training of the arbitrators. On January 10, 2012, the 8th plenary session of fifth meeting adopted Opinions on Further Intensifying the Arbitrators’ Training, which stipulated that BAC would, on the basis of entrusting Tsinghua University to hold the training for arbitrators, hold several business trainings and assess the arbitrators participating business straining and salon with scores which are connected with the arbitrators renewal and appointment. In 2012, the training activities we held include: 1. Continuing to hold “arbitrator training program” with Tsinghua University; 2. continuing to hold arbitrator salon activities, and we have held 11 salon activities in 2012; 3. The commission passed “Opinions on Further Intensifying the Arbitrators’ Training” and made the scoring statistics on arbitrators participating in business training and arbitrator salon which shall be taken as an important factor for appointing the arbitrators. In 2012, 4 business trainings had been held, which were trial methods and hearing techniques on important cases, how to make pre-hearing preparations, evidence rules on international commercial arbitration, invalid contract cognizance and handling; 4. Holding two mediation trainings with Hong Kong International Expert Society, Internet Mediation Center and Chinese Arbitration Association, Taipei respectively.

163 arbitrators had participated in the preceding trainings in the whole year, 89 arbitrators got more than 3 scores (meeting the standards on appointing sole arbitrator) and 49 arbitrators got 6 scores (meeting the standards on appointing the chief arbitrator).

Secondly, organize or participate in social training based on BAC’s practice.1. Organized two mediator trainings for Securities Association of China; 2. Held 7 trainings for new lawyers under cooperation with Beijing Lawyers Association; 3. Held 1 training for cost engineers under cooperation with Beijing Engineering Cost Association; 4. Held six special trainings for construction labor dispute settlement with cooperation with Beijing Municipal Construction Commission; 5. Held 12 trainings for class 1 construction engineer with cooperation with China Construction Industry Association; 6. Beijing Municipal Party School regarded BAC as the training base and provided training for section and bureau level cadres.

Thirdly, cooperating with the universities and colleges and organizing the training for the students on dispute settlement.1. Established the mechanism with China University of Political Science and Law and China Foreign Affairs University to take BAC as their teaching and research base; 2. Accepted the students’ visit from Tsinghua University, China University of Political Science and Law, Peking University and Renmin University of China; 3. Receive 11 trainees from universities.

Communication, publicity and promotion
Firstly, adopt multiple means to carry out publicity and promotion in different fields and for different targets.
1. Co-organized “25th Anniversary of China Joining in New York Convention Seminar on International Arbitration and Financial Arbitration” with Finance Arbitration and Mediation Study Center of Central University of Finance and Economics, and held two forums on financial law practice under cooperation with Central University of Finance and Economics; 2. Co-organized forum on company law practice with Chinese Company Law Management and Study Center of China University of Political Science and Law; 3. Set up labor dispute immediate settlement mechanism under cooperation with Beijing Municipal Construction Commission, and helped Construction Commission to revise the labor subcontracting contract (sample text); 4. Put more efforts to publicize dispute review system and make the breakthrough progress. There are two infrastructure projects that are willing to adopt dispute review system; 5. Publicize the arbitration and mediation in movie and TV dispute field; 6. Organized the internet companies to hold seminar on dispute settlement needs and form the special research team to study the disputes settlement in internet field; 7. Formulated the promotion plan in Beijing and drafted the initial plan and event plan on publicizing commercial arbitration in Beijing which has been approved by Office of Legislative Affairs and carried out emphatically this year; 8. Organized the 6th China Arbitration Forum.

Secondly, actively carry out overseas communication and enhance BAC’s international image. 1. Co-organized Symposium of International Arbitration in China – Ideal Form for Dispute Settlement” with French Embassy in China; 2. Invited to participate in 25th Anniversary of Pepperdine University Straus Dispute Settlement Center in US and watched the senior mediation training program of Law School of Pepperdine University; 3. Invited to visit International Law Institute in Washington; 4. Invited to participate in 2012 “China Arbitration Day” organized by Chinese European Arbitration Centre in Munich, visited Clifford Chance German Frankfort Office, and attended arbitration seminar on European companies in China and German breakfast meeting for arbitration circles; 5. Held China breakfast meeting in Dublin with Chinese European Arbitration Centre; 6. Visited Mr. Kenneth Feinberg, the associate of Feinberg & Rawson Law Firm and general director, responsible for Gulf of Mexico accident; 7. Received Minister of Business Development and Tourism of Bermuda, Mr. Tannin from British Center for Effective Dispute Resolution, president of the Korean Commercial Arbitration Board, arbitration study group of the Korean Commercial Arbitration Board, vice president and secretary-general of Vienna International Arbitration Centre, delegation from Hong Kong Institute of Arbitrators, chief counsel of ConocoPhillips Asia Region and former president of American Bar Association, etc.; 8. Received the lawyers from US, Italy and Korea, etc.; 9. Receive the teachers and students from Pepperdine University, University of Chicago, Aix-Marseille University, National Taiwan University and Taipei University; 10. Received LLM program overseas students from Tsinghua University, the teachers and students of “Sino-French Program” of Law School of Peking University to visit BAC; 11. 11 foreign trainees from Harvard University, Yale University, University of Pennsylvania and Pepperdine University, etc. to visit BAC.

(V) Work performance of office personnel

We have strengthened the internal construction of office, improved the organization structure and reviewed the term of office of two section chiefs and three deputy chiefs whose term of office has been expired. The medium-level cadres have completed competition for post and three section chiefs, three deputy section chiefs, and one section chief and one deputy section chief from general office have been selected through open competition for posts and democratic election, which has not only enriched our medium-level cadre teams, but also enabled our cadres to become more mature by competition and made us become an organization full of vitality and vigor.

There are 36 formal workers in the office. Besides the section chief, secretary responsible for case filing and the secretary responsible for case handling newly employed last year, each of 17 secretaries responsible for case handling closed nearly 100 cases on average. Besides the case filing and handling, the secretariat shall be liable for theoretical study, training, publicity, meeting organization, international communication, system construction and informatization construction, etc. The general office is mainly responsible for personnel management, finance, reception, service, conferences, file management, etc., which is the huge task and guarantees the normal operation of the whole commission. For instance, the accountant would process nearly 20,000 financial bills in the whole year and calculate and pay about 2008 times to the arbitrations, declare the online details 3677 person times and issue 309 detail taxation payments.

(VI) Operation of Mediation Center

The BAC Mediation Center has accepted 3 cases in 2012. Up to date, BAC has accepted 9 cases by independent mediation, and completed the mediation of 5 cases, involving the amount of subject matter of nearly 200 million Yuan.

II. General Characteristics and Analysis of the Performance in 2012

Looking through the overall performance of last year, we summarize that it is featured by:

(1) Successfully complete the leadership transition of BAC with the smooth transition of all powers and works

(2) The quality on case handing is better in general and confirms to the requirements of arbitration rules and internal specification on case handling

(3) A lot of fundamental tasks have been carried out

With the gradual standardization of performance of market participants, the cases of BAC in some traditional areas of strength grow slowly and even decline to some extent; however, we have seized such opportunity, carried out a lot of fundamental works, and expanded into the new areas such as finance, internet, intellectual property, energy and aviation, etc. by diversified forms of study, training and publicity. We have organized 58 conferences in large and medium size in the whole year, attracting 3671 participants; 46 trainings in large and medium size and 6637 participants from government authorities, enterprises and public entities, law firms and other arbitration organizations have accepted the training. By such fundamental performance, it has not only expanded BAC’s influence on emerging areas, but also enhanced BAC’s ability, strength and fame in solving disputes in many professional fields.

(IV) Fully exert the dominant role of arbitrators and realize the good interactive between arbitrators and arbitration organizations

In 2012, all the arbitrators have done their best and spared no effort in case processing, study, publicity and training. For instance, the leaders and initiators of each salon team and research group have actively organized the activities and study and contributed their ideas and thoughts to improving the professionalism of case handling and BAC’s influence in professional field. Take another example, the expert and scholar- arbitrators have written the articles and reports, expressed their opinions by using all platforms and tried to affect the law-makers to revise and improve the relevant laws by adhering to the principle of supporting arbitration so as to publicize the arbitration system and improve the arbitration development environment. Besides, there are a lot of arbitrators making all endeavors to promote the development of arbitration system and enhance BAC’s fame and professional image in all sectors by using their influence and resources in its sector, or their status as the NPC member or CPPCC member unselfishly. At the same time, BAC, as the platform, has helped a lot of arbitrators to practice their ideals of rule of law and professional study achievements and enhanced the academic communications. Therefore, BAC and its arbitrators have developed into a value community, professional community and work community, which is the important basis and guarantee for our future development.

III. Work Plan of 2013

2013 is the beginning year for 6th BAC commission and BAC shall further intensify the following tasks aiming at the general target of “developing BAC into diversified dispute settlement practice centre, study centre, training centre and publicity and promotion centre” as confirmed by the commission in the first meeting:

(1) Further improve the case handling quality and efficiency

As an institute providing the dispute settlement services, settling the dispute with high efficiency and supreme quality is fundamental for our survival and in 2013, we shall continue to be dedicated to improving the standardization and professionalism of arbitrators in case handling. To be specific, it consists of: continuing to perfect the arbitration rules and emphasizing arbitrators’ familiarity with the rules, continuing to improve the case handling standardization and strengthen the arbitrators’ understanding and application of case handing standardization, continuing to facilitate the arbitrators to strengthen study and discussion through arbitrator salon activities and all salon activities and carrying out trainings in diversified forms so as to improve arbitrator’s professional competence in substance and proceedings.

(II) Further intensify the research

Research should stress implementation and solidification of study achievements, emphasize the introduction to advanced international arbitration concept and system. To be specific, it includes: (1) forming and documenting the study content of such activities as arbitrator’ salon, salon team, study sessions and forum, etc. into the case handling guidance or standardization; (2) constantly improving the quality and influence of Beijing Arbitration; (3) making full use of BAC’s rich case resources, compiling excellent award, making summary analysis on awards and documenting into the guidance for practice; (4) strengthening the study on arbitration study, further exploring ADR service rules, introducing the world advanced theory and experience, translating the good study achievements worldwide and organizing and publishing the translated “New Horizon on Dispute Settlement” of BAC.

(3) Further intensify publicity and promotion

Domestically, it is necessary to intensify the publicity and promotion in newly emerging areas besides the traditional areas, in particular the industry or sector that has higher requirements on professionalism of dispute settlement and has little understanding on arbitration. Meanwhile, continue to enhance the publicity on key areas such as construction engineering and finance on the basis of maintaining the scope of publicity. Internationally, continue to keep the international influence by participating in international conferences, giving speeches and communications, etc.

(IV) Further strengthen the internal construction

Further strengthen the construction of commission and office, such as improving the decision-making rules and rules of procedure, as well as the system of arbitrator selection and appointment and training, etc., improve the level of informatization construction and conduct the perspective study on system reform of arbitration institution so as to make sure that BAC shall keep the sustainable development on right road.

At last, wish you happy new year and enjoy sound health!

Model Arbitration Clause Arbitration Clause
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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