International Governance and the Rule of Law in China Under the Belt and Road Initiative

CambridgeRoad Initiative University Press 978-1-108-42014-3Edited by Yun Zhao — International Governance and the Rule of Law in China under the Belt and Frontmatter More Information

INTERNATIONAL GOVERNANCE AND THERULEOFLAWINCHINAUNDER THE BELT AND ROAD INITIATIVE

This edited volume examines China’s role in the ﬁeld of international governance and the rule of law under the Belt and Road Initiative. The authors’ approach is holistic and seeks alternative analytical frameworks that not only take into account legal ideologies and legal ideals but also local demand, and sociopolitical circumstances, to explain and under- stand China’s legal interactions with countries along the Road; this allows more useful insights into predicting and analysing China’s and other emerging Asian countries’ legal future. Authors from Germany, Korea, Singapore, Mainland China, Taiwan and Hong Kong contributed to this edited volume in order to encourage academic dialogue and to conduct intellectual exchange in speciﬁc sub-themes.

  is Professor and Head of Department of Law at The University of Hong Kong; he gained his PhD from Erasmus University Rotterdam; an LLM from Leiden University; and an LLM and LLB from China University of Political Science and Law. Zhao is also Chen An Chair Professor in International Law at Xiamen University (2015), and Siyuan Scholar Chair Professor at Shanghai University of Foreign Trade (2012–14). He is listed as arbitrator in several international arbitration commissions.

© in this web service Cambridge University Press www.cambridge.org CambridgeRoad Initiative University Press 978-1-108-42014-3Edited by Yun Zhao — International Governance and the Rule of Law in China under the Belt and Frontmatter More Information

INTERNATIONAL GOVERNANCE AND THE RULE OF LAW IN CHINA UNDER THE BELT AND ROAD INITIATIVE

Edited by YUN ZHAO The University of Hong Kong

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www.cambridge.org Information on this title: www.cambridge.org/9781108420143 DOI: 10.1017/9781108332651 © Cambridge University Press 2018 This publication is in copyright. Subject to statutory exception and to the provisions of relevant collective licensing agreements, no reproduction of any part may take place without the written permission of Cambridge University Press. First published 2018 Printed and bound in Great Britain by Clays Ltd, Elcograf S.p.A. A catalogue record for this publication is available from the British Library. Library of Congress Cataloging-in-Publication Data Names: Zhao, Yun, editor. Title: International governance and the rule of law in China under the Belt and Road Initiative / edited by Yun Zhao. Description: New York : Cambridge University Press, 2018. | Includes bibliographical references and index. Identiﬁers: LCCN 2018024257 | ISBN 9781108420143 (hardback) Subjects: LCSH: Rule of law–China. | Soft law–China. | Globalization–China. | International economic relations. | Regional economics–China. | Trade routes–Eurasia. | Infrastructure (Economics)–China. | China–Foreign economic relations. | China–Commerce–Eurasia. | Eurasia–Foreign economic relations–China. | BISAC: LAW / International. Classiﬁcation: LCC KNQ2025 .I58 2018 | DDC 340/.11–dc23 LC record available at https://lccn.loc.gov/2018024257 ISBN 978-1-108-42014-3 Hardback Cambridge University Press has no responsibility for the persistence or accuracy of URLs for external or third-party internet websites referred to in this publication and does not guarantee that any content on such websites is, or will remain, accurate or appropriate.

CONTENTS

List of Figures vii List of Tables viii List of Contributors ix

Introduction 1     Convergence of International Rules 7 1 The Belt and Road Initiative and International Law: An International Public Goods Perspective 9   2 Performative Uses of Sovereignty in the Belt and Road Initiative 32  Ä   Development of Substantive International Rules and China’s Contribution 57 3 The Belt and Road Initiative under Existing Trade Agreements: Some Food for Thought on a New Regional Integration Scheme 59   4 Anti-Monopoly Law in China: Administrative and Private Enforcement and the Belt and Road Initiative from an Anti-Monopoly Law Perspective 81   5 The Belt and Road Initiative: Cooperation in Trade Liberalisation and Antitrust Enforcement 104    

vi  6 The Belt and Road Initiative, Expropriation and Investor Protection under BITs 132   7 ASEAN Financial Integration and the Belt and Road Initiative: Legal Challenges and Opportunities for China in Southeast Asia 163   8 A Prognostic View of the Applicable Law for AIIB Loan Agreements 197   9 The Role of Environmental Impact Assessment in the Governance of the Nu-Salween River: A Comparative Study of the Chinese and Myanmar Approaches 218   10 The Role of Regional Space Cooperation in Procuring Space Security in the Asia-Paciﬁc Region: Prospects for the Future 243     Development of International Dispute Resolution under the Belt and Road Initiative 259 11 Regional Dispute Resolution: An International Civil Dispute Resolution Model for East Asia 261   12 Enforcement of Arbitral Awards in Asia under the Belt and Road Initiative: Implications for International Governance and the Chinese Rule of Law 277   13 Establishment of an International Trade Dispute Settlement Mechanism under the Belt and Road Initiative 295  

Index 312

FIGURES

6.1 Growth in China’s Outbound Investment (1990–2016) 138 11.1 Arbitration Cases Heard by the Japan Commercial Arbitration Association between 2000 and 2010 267 11.2 Singapore International Arbitration Centre Cases from 2001 to 2012 273

vii

TABLES

3.1 Number of BITs/FTAs of Countries Situated on the Ancient Silk Road 65 6.1 China’s BITs and FTAs with BRI Countries 140 6.2 Existing BITs between China and Other BRI Countries 162 7.1 Limitations on Market Access under China-ASEAN FTA for Select Sectors 174 7.2 Commercial Presence of Selected Chinese Banks in Southeast Asia 177 7.3 Speciﬁc Commitments Regarding Banking Services for Select ASEAN States 178 7.4 Speciﬁc Commitments Regarding the Insurance Sector 185 11.1 International Cases Handled by Arbitral Institutions Globally 268 11.2 Mainland China-Related Cases Accepted by the HKIAC from 2007 to 2012 275 11.3 International Commercial Arbitration Cases in East Asia Settled by the International Chamber of Commerce from 1998 to 2009 276

viii

CONTRIBUTORS1

  is Professor and Head of the Department of Inter- national Law at the School of Law, University of International Business and Economics, Beijing. She obtained her PhD from the University of International Business and Economics; and LLM and LLB from the China University of Political Science and Law. She is a member of the Committee on the Role of International Law in Sustainable Natural Resource Management for Development under the International Law Association. Bian is the winner of the An Zijie Award for Research in International Trade, 2006 by the An Zijie Award Committee in China. Her research interests focus on international environmental law and environment-related trade and investment issues.

  studied at Kobe University in Japan (LLM and PhD) and was Research Fellow there from 2014 to 2015. He currently teaches at the Law School of Lanzhou University. He is a council member of the China Society of International Private Law and a member of the China Acad- emy of Arbitration Law. Chai is also a member of the Academy for International Business Transactions in Japan. His main research topics are as follows: international private law and international commercial arbitration.

  is Associate Professor of Law at the Singapore Management University (SMU). He received a PhD from the University of London (UCL) and LLM from the University of Michigan, after completing law degrees at the National Taiwan University. His main research interests include ﬁnancial regulation, derivatives and risk management,

1 Chinese names in this list and in the rest of the volume are in Western order so that a person’s forename comes ﬁrst, and then the surname, unless the name forms part of a title, is quoted matter or an award name. Where names are given in traditional Chinese, surnames appear ﬁrst. ix

x    ﬁnancial consumer protection, corporate governance and transplantation of law in Asia in broad areas of corporate, banking, insurance and ﬁnan- cial laws. Chen has published in both English and Mandarin Chinese in the United States, United Kingdom, Europe, Singapore and Taiwan.

  is Associate Professor of Law at The University of Hong Kong. She obtained her SJD and MCL degrees from The University of Hong Kong, and LLB degree (International Economic Law) from East China University of Political Science and Law. Her research interests are in arbitration, commercial dispute resolution and private international law, focusing on Greater China. Before joining The University of Hong Kong, Gu was Fulbright Fellow at the New York University School of Law where she taught arbitration and dispute resolution courses with Jerome A. Cohen. She is a member of the Chartered Institute of Arbitra- tors (London and East Asia), and serves on the Executive Council Board of the China Society of Private International Law. She also sits on the editorial team of the Hong Kong Law Journal (SSCI).

  is Doctor of Laws and Assistant Researcher, Institute of Social Sciences, East China University of Political Science and Law, from where he obtained his LLB and PhD, majoring in public international law. He is also a visiting scholar at the Faculty of Law, The University of Hong Kong; guest professor at Faculty of Law, Shanghai Maritime University; and a distinguished expert of the “Shanghai Outstanding Legal Talents (Foreign Affairs) Education Program”. Jiang is a member of the council at the Chinese Institute of Space Law, and a member of the Asian Society of International Law, Chinese Society of International Law. He has published around forty papers in several SSCI and CSSCI journals and many other academic journals.

    is Deputy Director and Fellow of the Asian Institute of International Financial Law, and Assistant Professor of Law at The University of Hong Kong. He obtained his LLM from the Uni- versity of Chicago, and his LLB and BBA (Law) from The University of Hong Kong. Kwok has served as Associate/Articles Editor of the Oxford University Commonwealth Law Journal, Hong Kong Law Jour- nal, and China Antitrust Law Journal; as Non-Governmental Advisor to the International Competition Network; and on the Competition Policy Committee of the Hong Kong Consumer Council, the Special Committee

   xi on Competition Law of the Hong Kong Bar Association, and the Execu- tive Committee of the Hong Kong Competition Association. He is a barrister of the High Court of Hong Kong.

  is Professor of Law of the School of Law, Seoul National University in Seoul, Korea. He also serves as Associate Dean for Aca- demic Affairs for the law school. He obtained his LLB, LLM and PhD from Seoul National University; LLM from Georgetown University Law Center; and JD from Boston College Law School. His major areas of teaching and research are public international law, international trade law and international investment law. Lee has published articles and books (including book chapters) on various topics of public international law, international trade law and international investment law.

  is Professor of Law at Nanjing University. He obtained his PhD, LLM and LLB from Nanjing University. Between 2008 and 2010, he was Postdoctoral Fellow in the Law School of Fudan University. Peng is a director member of the Chinese Society of International Economic Law and China Securities Law Research Association. His interests lie in the domestic regulation of global economic activities and the international economic regulatory coordination and cooperation between sover- eign states. He has published more than sixty articles on various topics including international trade law, international investment law and international ﬁnance law.

 Ä is Assistant Professor at the Faculty of Law of the Chinese University of Hong Kong. He holds an SJD from Harvard Uni- versity and an LLM from the University of Helsinki. His research focuses on legal and political thought in China and developmental aspects of international law.

  is Dean and Professor of Law at Shandong University Law School. He obtained his PhD from the London School of Economics; LLM from the University of Cambridge (UK); LLM from the Univer- sity of Michigan; and LLM and LLB from the East China University of Political Science and Law. He qualiﬁed as a lawyer in New York and has been practising for the last ten years, mostly in Hong Kong, in foreign direct investment, private equity and mergers and acquisitions. He is an arbitrator with Hong Kong International Arbitration Centre, Singapore

xii    International Arbitration Centre, Shanghai International Arbitration Centre, Shanghai Arbitration Commission and Shenzhen International Court of Arbitration. His main research interests include ﬁnancial regulation, corporate governance, international investment law and commercial arbitration. He has published 6 books and more than 160 articles in Chinese and English journals, and one of his articles was cited by the Supreme Court of Singapore.

  is Professor of Law and Dean, School of Law, China University of International Business and Economics (UIBE) based in Beijing. She also serves as Director for the International Law Institute, and Director of the Research Center for Uniﬁcation of Commercial Law, both at UIBE. She obtained her JSD and LLM from Yale Law School; her PhD, LLB and BA from Wuhan University. She was appointed as Chen An Chair Professor in International Law at Xiamen University (2012). Shi is a member of the Governing Council of UNIDROIT and of the Panel of Conciliators at the International Centre for Settlement of Invest- ment Disputes (ICSID), and she is listed as arbitrator in several international arbitration commissions. She has published widely on various topics including trade in services, cross-border insolvency and international investment law.

  is currently completing her doctoral degree program at the University of Würzburg, Germany. Her ﬁelds of research are the anti-monopoly law and the law of conﬂicts with a focus on comparing Chinese and German law. She will obtain her LLM degree from the University of California at Berkeley in August 2018. In August 2011, she successfully passed the German First State Exam in law after her studies at the Humboldt University in Berlin. Wersborg has extensive experience in Chinese Law due to her research interests and several stays in China, including as a visiting scholar at The University of Hong Kong where she gave several lectures. She has also published several articles in the German Journal of Chinese Law.

  is Professor and Head of the Department of Law at The University of Hong Kong. He gained his PhD from Erasmus University Rotterdam; an LLM from Leiden University; and LLM and LLB from China University of Political Science and Law. Yun Zhao is also Chen An Chair Professor in International Law at Xiamen University (2015) and

   xiii Siyuan Scholar Chair Professor at Shanghai University of Foreign Trade (2012–14). He is listed as an arbitrator in several international arbitration commissions. He sits on the editorial teams of several SSCI journals, including Hong Kong Law Journal (as China law editor) and Journal of East Asia and International Law (as executive editor). Zhao is the winner of the Prof. Dr. I.H.Ph. Diederiks-Verschoor Award 2006 by the International Institute of Space Law in France, the ﬁrst winner of Isa Diederiks-Verschoor Prize in the Netherlands and also the ﬁrst winner of SATA Prize by the Foundation of Development of International Law in Asia (DILA). He has published widely on various topics, particularly dispute resolution and space law.