Criminal Liability of Arbitrators in China: Analysis and Proposals for Reform

(ProQuest: ... denotes non-US-ASCII text omitted.)I. INTRODUCTIONAlthough international commercial arbitration in China started in 1950s,1 it stood still until adoption of reform and opening-up policy of late 1970s.2 China's accession into World Trade Organization (WTO) in December 2001 and growing globalization of world economy have greatly increased international trade and investment in China.3 In wake of modern explosion of international trade and transnational investment, arbitration has become the accepted method for resolving international business disputes.4 Arbitration has also become a preferred method for foreign parties to resolve their legal disputes in China, due in large part to distrust these parties have of Chinese courts.5Nonetheless, parties must recognize that China's arbitration system is very young. Although commercial arbitration started in 1950s, first arbitration law, Arbitration Law of People's Republic of China, hereinafter Arbitration Law, is only twenty years old.6 In contrast, United States has a long history of arbitration. The U.S. Congress passed Federal Arbitration Act (FAA) in 1925.7 The FAA provides that if there is an arbitration clause, court shall, on application of one of parties, stay trial of action until such arbitration has taken place.8 In recent years, U.S. courts have expanded range of enforceable arbitration agreements to include agreements that cover areas of law previously thought to be within exclusive domain of courts.9Parties from different nations tend to seek arbitration in order to prevent an abundance of jurisdictional problems. 10 Unlike litigation, arbitration provides a neutral venue for international disputes and aims to ensure procedural fairness for both parties.11 Arbitration permits parties from different countries to exercise a great deal of control over how a dispute will be resolved.12 The parties are free to tailor proceedings to meet their needs. Specifically, parties can contract to govern all disputes by a certain set of laws or procedures.13 They decide scope and content of arbitration, define its procedures, and choose location of arbitration by specifying these stipulations in arbitration agreement.14 Most importantly, parties have power to choose decision maker.15 This freedom to select arbitrator is why arbitration has been described as hiring your own private judge.16 Arbitration benefits parties not only by ensuring procedural fairness, but also by providing predictability, lowering attorney fees, and increasing privacy and expertise in decision making.17 The finality of arbitration is another advantage, which is often attractive for its speed and cost-effectiveness.18 Arbitral awards are final and binding, and can be enforced in same manner as court judgments.19 Particularly with well-functioning international enforcement system under 1958 New York Convention,20 arbitral awards are often easier to enforce than court judgments. 21 With its acceptance and popularization, international commercial arbitration now plays a very important role in settling private conflicts.Arbitrator bias, however, negates many of benefits of arbitration to commercial parties. 22 In China, where bribery of public officials is prevalent, arbitral awards might also be tainted by bribery.23 For instance, Jiang Hanwu, former vice chairman of Arbitration Commission in Lian Yun Gang city, Jiangsu Province, was charged with bribery in 2001.24 The increased risk that Western parties may incur in this aspect of relations with Chinese parties increases importance of ensuring impartiality of arbitrators deciding their disputes.25 The issue of arbitrator impartiality is therefore critical to development of arbitration rules and cannot be ignored in process of international private dispute resolution. …