The EU bull in the China shop

  • Author : Richard Frimston
  • Date : February 2012
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ABOUT THE AUTHOR: Richard Frimston TEP is a Partner and Head of the Private Client Team at Russell-Cooke LLP, and Chairman of the STEP EU Committee

While members of the European Central Bank (ECB) have been visiting China a lot recently, other readers may not necessarily have studied the Decree of the President of the People’s Republic of China No. 36 on the Laws Applicable to Foreign-related Civil Relations, adopted on 28 October 2010 at the 17th session of the Standing Committee of the 11th National People’s Congress of the People’s Republic of China. This came into effect on 1 April 2011.

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It is ever so snappy. Not having much Mandarin or Cantonese, I rely on the translation of Professor Lu, the Secretary General of the Chinese Society of International Law, available from bit.ly/ChinaPIL.

Chapter 1 contains general provisions

Article 9: ‘The foreign law applicable to a foreign-related civil relation does not include the conflict rules of that country’ means that there is no renvoi, so reference to a particular law is to the internal or domestic law.

Chapter 3 deals with marriage and family

Article 24: ‘In respect of spousal property, the parties may by agreement choose to apply the law of a party’s habitual residence or nationality, or the law of the place where the main property locates. Absent any choice by the parties, the law of their common habitual residence shall be applied; absent common habitual residence, the law of their common nationality shall be applied.’ So make sure you have choice of law provisions in all prenuptial agreements and matrimonial contracts.

‘Quite how the People’s Republic of China defines habitual residence, I do not know’
Chapter 4 deals with succession

Article 31: ‘Statutory succession is governed by the law of the habitual residence of the deceased when he/she dies. However, statutory succession of immovable property is governed by the law where the immovable property locates.’

Article 32: ‘A will is considered formed if the testamentary form conforms to the law of the habitual residence of the testator when he/she creates the will or when he/she dies, or to the law of his/her nationality, or to the law of the place where the act of creating the will occurs.’

Article 33: ‘The effect of a will is governed by the habitual residence of the deceased when he/she creates the will or when he/she dies, or by the law of his/her nationality.’

Article 34: ‘Matters of estate administration, etc, are governed by the law of the place where the estate locates.’

Article 35: ‘Ownership of estate without a successor is governed by the law of the place where the estate locates when the deceased dies.’

No choice of applicable law here. Quite how the People’s Republic of China defines habitual residence, I do not know, and I am not sure that I understand the interaction of articles 31 and 33. If only I had the time I would be attending the Hague Academy of International Law Summer School in 2012 to learn the answers to these questions from Chen Weizuo, Professor at Tsinghua University, Beijing, who is talking on the new codification of Chinese private international law (PIL). Details are online at bit.ly/HagueAcademy. I do hope that a STEP member will soon provide an article or two on these topics and provide enlightenment.

Given that the new Chinese PIL only deals with applicable law and does not include questions of jurisdiction, recognition, enforcement or inheritance certificates, perhaps those in Brussels now struggling with the proposed Succession and Matrimonial Property Regime Regulations could simply ratify the Chinese code? Could this help the ECB?

Parts of the UK government may certainly find this more their cup of tea.


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