Coordination of legal systems by the recognition of foreign judgments? Rethinking reciprocity in Sino-Japanese relationships

• Author: Coordination of legal systems by the recognition of foreign judgments? Rethinking reciprocity in Sino-Japanese relationships
• Pages: 193-230

FRONTIERS OF LAW IN CHINA

VOL. 14 JUNE 2019 NO. 2

DOI 10.3868/s050-008-019-0011-7

ARTICLE

COORDINATION OF LEGAL SYSTEMS BY THE RECOGNITION OF FOREIGN

JUDGMENTS ― RETHINKING RECIPROCITY IN SINO–JAPANESE RELATIONSHIPS

Yuko Nishitani∗

Abstract In the era of globalization, commercial transactions readily gain international

dimensions and are increasingly delocalized. With a view to establishing effective

dispute resolution mechanisms, it is desirable that judgments rendered in one state be

recognized and enforced in other states. This is especially important in East Asia, as

cross-border business activities are rapidly expanding along with its economic growth.

This paper aims to examine the recognition and enforcement of judgments in civil and

commercial matters in East Asia with a focus on Sino–Japanese relationships, where the

establishment of a reciprocal relationship has posed a considerable challenge. It is worth

considering how we can gradually pave the way towards the mutual recognition and

enforcement of judgments to achieve coordination among legal systems.

Keywords recognition and enforcement of foreign judgments, reciprocity, East Asia,

China, Korea, Japan

INTRODUCTION .................................................................................................................... 194

I. RECOGNITION AND ENFORCEMENT OF FOREIGN JUDGMENTS IN JAPAN.................. 196

∗ Yuko Nishitani, Ph.D. in Private International Law, School of Law, Heidelberg University, Heidelberg,

Germany; Professor of International Private and Business Law, Graduate School of Law, Kyoto University,

Kyoto 606-8501, Japan. Contact: nishitani@law.kyoto-u.ac.jp

The author sincerely thanks Prof. King Fung Tsang (The Chinese University of Hong Kong) for making

his unpublished paper available (infra note 185). She also expresses her gratitude to Ms. XIANG Nian, Ms.

CHEN Yuan, Ms. GUO Yixin, Ms. CHEN Siyu, and Mr. LIAO Jinjun for providing a Japanese translation of

the Qingdao Intermediate People’s Court decision of Mar. 25, 2019 (infra note 178).

Abbreviations: AGRAL = Hô no tekiyô ni kansuru tsûsoku hô (Japanese Act on General Rules on

Application of Laws [Conflict of Laws Act]); CEA = Civil Execution Act; CCCP = Chinese Code of Civil

Procedure; ECHR = European Convention on Human Rights; ECt HR = European Court of Human Rights;

EGBGB = Einführungsgesetz zum Bürgerlichen Gesetzbuch (German Introductory Act to the Civil Code);

FamFG = Gesetz über das Verfahren in Familiensachen und in den Angelegenheiten der freiwilligen

Gerichtsbarkeit (German Law on Procedure in Family and Non-Contentious Matters); FPA = Japanese

Procedure Act in Family Matters; InsO = Insolvenzordnung (German Law on Insolvency); PIL = Private

International Law; SPA = Japanese Procedure Act in Status Matters; SPC = Supreme People’s Court of

China; ZPO (CPO) = Zivilprozeßordnung (German Civil Procedure Code). For English translations of

South Korean laws, available at http://www.moleg.go.kr/english/korLawEng (last visited Mar. 29, 2019);

for English translations of Japanese laws, available at http://www.japaneselawtranslation.go.jp/? re=02

(last visited Mar. 29, 2019).

194 FRONTIERS OF LAW IN CHINA [Vol. 14: 193

A. Foundations....................................................................................................... 196

1. General Principles......................................................................................... 196

2. Recognition Theories.................................................................................... 198

3. Comparative Overview................................................................................. 200

B. Requirements of Judgments Recognition........................................................... 201

1. General Remarks........................................................................................... 201

2. Requirements of Judgments Recognition in Japan....................................... 202

II. FUNDAMENTAL IDEAS OF RECIPROCITY................................................................. 204

A. Historical Developments................................................................................... 204

1. General Ideas ................................................................................................204

2. Germany ....................................................................................................... 205

3. Japan .............................................................................................................207

B. Criteria of Reciprocity in Japan........................................................................ 210

1. Developments of Case Law .......................................................................... 210

2. Implementation............................................................................................. 211

III. RELATIONSHIP BETWEEN CHINA AND JAPAN......................................................... 213

A. Status Quo......................................................................................................... 213

1. Reciprocity in China..................................................................................... 213

2. Initial Stalemate in China.............................................................................. 214

3. Response from Japan ....................................................................................216

B. Possible Way-Out in Sino–Japanese Relationships........................................... 219

1. Theoretical Foundations of Reciprocity........................................................ 219

2. Recent Developments of Case Law in China................................................ 221

3. Practical Solutions ........................................................................................ 225

4. Remaining Issues.......................................................................................... 228

CONCLUSION........................................................................................................................ 229

INTRODUCTION

In the era of globalization, the cross-border movement of persons, goods, services,

capital and information is intensifying. Commercial transactions readily gain international

dimensions and are increasingly delocalized. This necessitates harmonizing substantive

and conflicts rules to regulate transactions and establishing effective dispute resolution

mechanisms. With a view to guaranteeing legal certainty, efficiency and access to justice,

it is desirable that judgments rendered in one state be recognized and enforced in other

states. Otherwise, parties incur costs of relitigation which may lead to contradictory

decisions, or they may be barred from filing another suit due to a statute of limitations.

The guarantee of the circulation of judgments is particularly important in Asia, where

cross-border business activities are rapidly expanding along with its economic growth.

In East Asia between China, South Korea (“Korea”) and Japan, there have not been

any bilateral or multilateral treaties dealing with the recognition and enforcement of

2019] COORDINATION OF LEGAL SYSTEMS BY THE RECOGNITION OF FOREIGN JUDGMENTS 195

judgments in civil and commercial matters to date,1 except for the 1969 International

Convention on Civil Liability for Oil Pollution Damage.2 Thus, the recognition and

enforcement of foreign judgments is governed by domestic law that includes the

requirement of “reciprocity” in principle (Articles 281 and 282 of the Chinese Code of

Civil Procedure (CCCP); Article 217 No. 4 of the Korean Code of Civil Procedure

(KCCP); Article 118 No. 4 of the Japanese Code of Civil Procedure (JCCP)).

Reciprocity means that the receiving state recognizes and enforces foreign judgments,

only to the extent that the state of origin reciprocates with the recognition and

enforcement of judgments of the receiving state. While a reciprocal relationship has

been established between Korea and Japan,3 it has so far not been the case between

China’s mainland and Japan, except with respect to divorce cases, while a remarkable

progress can be observed as to judgments recognition between China’s mainland and

Korea.4 It is unfortunate that judgments do not freely circulate in East Asia. In light of

the recent developments in Chinese case law, as will be discussed below (infra III-B-2),

1 China has thus far signed 36 bilateral treaties on judicial assistance, 33 of which include provisions on

the mutual recognition and enforcement of judgments in civil and commercial matters. Notably, 22 out of the

33 countries belong to the One Belt and One Road partners. However, they do not include China’s major

trading partners, i.e. Korea, Japan, Australia, the United States, the United Kingdom or Germany. For a

thorough analysis, see King Fung Tsang, Chinese Bilateral Judgment Enforcement Treaties, 40 Loyola of Los

Angeles International and Comparative Law Review, 1, 6 ff. (2017); also Zheng Sophia TANG, XIAO

Yongping & HUO Zhengxin, Conflict of Laws in the People’s Republic of China, Edward Elgar

(Cheltenham/UK), at 148 ff. (2016); GUO Yujun, The Republic of China, in Adeline Chong ed. Recognition

and Enforcement of Foreign Judgments in Asia, Asian Business Law Institute (Singapore), at 50 ff. (2017).

2 See Art. 10 of the International Convention on Civil liability for Oil Pollution Damage, Brussels, Nov.

29, 1969. China acceded to this instrument on Jan. 30, 1980 (entering into force on Apr. 29, 1980), Korea Dec.

18, 1978 (entering into force on Mar. 18, 1979) and Japan on Jun. 3, 1976 (entering into force on Sep. 1,

1976). For the status table, see the website of the Comité Maritime International (CMI), available at

http://www.comitemaritime.org/ (last visited Mar. 29, 2019).

3 For Japanese judgments recognizing Korean judgments, see Yokohama District Court, Mar. 30, 1999,

1696 Hanrei Jihô 120; Tokyo District Court, Feb. 12, 2009, 2068 Hanrei Jihô 95; Tokyo District Court,

Dec. 13, 2013, LEX/DB25516699 (Westlaw 2013WLJPCA12138015).

4 Korea has recognized Chinese judgments several times (see Seoul District Court judgment of Nov. 5,

1999 granting an exequatur for a judgment from the Weifang Intermediate People’s Court in Shandong

Province; Suwon District Court (Ansan Branch) judgment of Dec. 24, 2015 granting an exequatur for a

judgment from the Qingdao Intermediate People’s Court (with appellate instances)) (cited from Suk, infra,

Korea-3, at 195 ff.), but been refused the recognition of its judgments by Chinese courts in 2011 and 2015

(infra note 123), until China finally reciprocated on Mar. 25, 2019 to enforce a judgment from the Suwon

District Court of Korea (infra III-B-2). For the state of discussion until 2018, see Kwang Hyun Suk,

Recognition and Enforcement of Foreign Judgments in the Republic of Korea, 15 Yearbook of Private

International Law, 434 (2013/2014) (Korea-1); Id., South Korea, in Adeline Chong ed. Recognition and

Enforcement of Foreign Judgments in Asia, Asian Business Law Institute (Singapore), at 195 f. (2017)

(Korea-2); Id., Recognition and Enforcement of Judgments between China, Japan and South Korea in the

New Era: South Korean Law Perspective, 13(2) Frontiers of Law in China, 195 ff. (2018) (Korea-3); Sung

Hoon Lee, Foreign Judgment Recognition and Enforcement System of Korea, 6 Journal of Korean Law, 135

(2006).