China has set up three international courts to manage disputes pertaining to its multi-billion dollar Belt and Road Initiative. They will be located in Beijing, Xi’an, and Shenzhen. While Beijing will oversee general cases, the Xi’an court will consider cases related to the Silk Road. The Shenzhen court in South China will examine Maritime Silk Road matters.
The function of the courts is to handle litigation and alternative dispute resolution options while providing legal support to various entities. The development of a plan to resolve trade and investment concerns was approved during the second meeting of the Central Leading Group for Deepening Overall Reform. China claims that more than sixty nations have agreed to Belt and Road Initiative investments; therefore, the primary aim is to ensure that there is collaboration between Eurasian and Chinese nations in places such as the China-Pakistan economic corridor.
It is uncertain how the courts will oversee cases from each country when they have such different legal systems. It is presently understood that a dispute resolution process will be developed in accordance with the principles of the current Chinese judiciary, arbitration, and mediation agencies. However, a primary challenge for policy-makers is to consider how a stable and reasonable corporate environment can be created which delivers equal protection for China and foreign entities. This will be a particularly onerous task, as the nations that are involved with the initiative have differing legal systems and social customs. The Director of the Institute of International Affairs at Renmin University contends that the courts should apply Western laws and utilize English as the main language.
The China Council for the Promotion of International Trade acknowledges that it plans to work with non-government organisations that are focused on commercial issues to develop an international organisation that oversees disputes. China also promises to transfer its arbitrators and mediators to work in international organisations in order to give its personnel opportunities in the area of international dispute resolution.
The Belt and Road Initiative is an incredible opportunity for China to develop its stature as an economic powerhouse. The huge financial hub will no doubt be valuable in giving projects the financial and legal support that they need to ensure that they are managed in a sustainable way. Countries such as Singapore have recently acknowledged that they would like to work with China on the development of the initiative, especially since 33% of outward investments related to the Belt and Road Initiative flow through Singapore. Through such cooperation with other nations, China is demonstrating that it can gain the trust of the global economic community. However, it should seek to minimize logistics costs related to Belt and Road Initiative projects in order to make sure that associated opportunities continue to be economically attractive to investors.
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