The PRC has passed a new law which will apply the “restrictive” approach to foreign state immunity with effect from 1 January 2024.  As a result, foreign states will not be granted immunity from suit or execution in the PRC in respect of certain commercial activities and assets.  The PRC government has indicated that the same approach should apply in Hong Kong and Macau.

The Foreign State Immunity Law was adopted by the Standing Committee of the National People’s Congress (“SCNPC“) on 1 September 2023.  A statement by the Ministry of Foreign Affairs of the PRC said the law aimed to improve the PRC’s state immunity system in line with international practice.

The new law marks a departure from the “absolute” doctrine of immunity previously followed by the PRC (which does not provide any exception for commercial activities).  The PRC joins many other jurisdictions in adopting the restrictive approach (including the USA, the UK, India, Singapore, Australia, New Zealand and most member states of the European Union).

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Singapore Court of Appeal sets aside injunction against Maldivian state-owned company in airport dispute

The Singapore Court of Appeal has set aside an interim injunction granted by the High Court against a Maldivian state-owned corporation (“MACL“), by which MACL had been restrained from interfering with the operation of the Maldives airport by the relevant concession holder (“GMIAL“), a joint venture entity partly owned by the India-based infrastructure group, GMR. (A copy of the decision can be found here).

In deciding the injunction application, the Court of Appeal had to consider the question of whether it had the power to grant an injunction – in light of the fact that MACL was a state-owned corporation; and whether the circumstances of the case justified grant of an injunction.

Please click here to read our post on our Arbitration blog.

“Dispute resolution and governing law clauses in China-related commercial contracts”: 5th edition now available

Chinese law restricts both the choice of law and the types of dispute resolution mechanism in China-related commercial contracts. As a result, drafting governing law and dispute resolution clauses in these contracts is not straightforward. This guide, designed for clients doing business in China or with Chinese counterparties, explains when the restrictions apply and how to draft so your contracts do not fall foul of them.

The guide has been updated to include recent developments in China arbitration, including:

  • new rules published by China’s leading arbitral institution (CIETAC)
  • arbitration-related amendments to the PRC Civil Procedure law, and
  • a recent internal dispute within CIETAC.

Now in its 5th edition, the guide has proven popular with in-house counsel working both in and outside China.

Click here to access a short “taster” version of the guide

If you would like a full copy of the guide, in hard or soft copy, please email Briana Young.



Privy Council rules on the liability of State-owned corporations for debts of the State

On 17 July 2012, the Privy Council gave judgment in a case brought by FG Hemisphere, a Delaware corporation, against La Générale des Carrières et des Mines (“Gécamines“), a mining company owned by the Democratic Republic of Congo (“DRC“).

The judgment develops the law on the liability of state-owned corporations for debts owed by the State.  The Privy Council, by reference to a comprehensive range of English, US, French, Commonwealth and international case law, has issued an authoritative view on the matters to be taken into account when considering whether a state-owned entity may be equated to a State for the purposes of liability and enforcement. The Privy Council held that Gécamines was clearly an entity distinct from the State, and as such, FG Hemisphere was unable to enforce DRC debts against Gécamines’ assets.  

This judgment follows the recent case of Democratic Republic of the Congo v. FG Hemisphere (FACV Nos. 5, 6 & 7 of 2010) in the Hong Kong Court of Final Appeal, and considers some of the same facts that arose in that case.  Please click here to read our post on our Arbitration blog.