Chinese Legislation and Judicial Practice
There existed no notion of “mandatory rules” in the Chinese private international law legislation until the enactment of the Conflicts Act in 2010.Advocated by the conflicts scholars,the Conflicts Act introduces the notion of mandatory rules which in view of its legislative purpose may not be derogated from,even if a law of another country is designated as the applicable law.Article 4 of the Act prescribes the following:
The laws of the People’s Republic of China which are mandatorily applicable to foreign- related civil relationships shall be applied directly.
It should be stressed that under the wording of Article 4 of the Conflicts Act,mandatory rules seem to refer to the mandatory rules of the forum; that is to say,mandatory rules of a foreign country are of no direct applicability.With regard to the mandatory rules contained in an international convention,it is believed that those rules should be applied directly,as long as the PRC is a contracting party to that convention.In this respect,mandatory rules in the context of Chinese Conflicts Act is different from the “international mandatory rules” (or “overriding mandatory provisions”) commonly understood by the private international lawyers as described above.9
Needless to say,the incorporation of “mandatory rules” into the Conflicts Act represents a significant legislative development; nevertheless,it should be noted that the concept of mandatory rules in Article 4 of the Act is somewhat vague and elusive which led to some cases in which the People’s Courts misused the notion.10
In this light,the Supreme People’s Court deems it necessary to provide concrete explanations to help judges to understand Article 4 of the Conflicts Act.Hence,the Interpretation (I) issued in 2012 provided a more detailed definition of mandatory rules in Article 10,which consists of a general description and a specific enumeration.(https://www.daowen.com)
According to Article 10 of the Interpretation (I) ,“mandatory rules”,for the purpose of the Conflicts Act,means the provisions in laws or administrative regulations directly applicable to foreign-related civil relations that concern the socio-public interests of the PRC and cannot be derogated by agreement.Then,a number of categories follow: (1) the provisions that bear on the protection of labourers’ rights,(2) the provisions that bear on the safety of food or public sanitation,(3) the provisions that bear on environmental safety,(4) the provisions that bear on financial safety,e.g.administration of foreign exchange,(5) the provisions that bear on antitrust and antidumping and (6) other categories that should be regarded as mandatory rules.
Obviously,under Article 4 of the Act and Article 10 of the Interpretation (I),Chinese judges are left with considerable discretion in deciding whether to invoke mandatory rules in any particular case.This solution,although understandable,does lend itself to criticism.Most importantly,judges should be very scrupulous when exercising such power.It would be very unfortunate if the notion of mandatory rules were to be employed to thwart the application of all laws,which would otherwise apply.
For this reason,the SPC emphasizes that “mandatory rules” in the context of private international law are categorically different from “contractual ius cogens rules” insomuch as the latter form part of the domestic system of substantive law which is usually broader in scope than the former; expressed differently,while some rules,when applied in purely domestic legal scenarios,may be mandatory,they are not necessarily so in cases involving a foreign element.It goes on to stress that when judging whether a rule is internationally mandatory or domestically contractual mandatory,judges should analyse the legislative purpose.
As a result,the People’s Courts should be more scrupulous in applying the notion of mandatory rules when a foreign element is involved than when a purely municipal legal issue is at hand.Otherwise,it may be interpreted to embrace such a multitude of domestic rules as to provide a fatally easy excuse for the application of the law of the forum and thus to defeat the underlying purpose of private international law.