2022-06-22 09:46:25
Usually, the clause of governing law and jurisdiction is a focus in the negotiation of an
international commercial contract, and most parties take for granted that the laws and arbitration tribunals (courts) of their own countries are advantageous. However, contrary to the popular belief, I think it is not always good to the foreign buyers to choose the laws and/or the arbitration tribunal of their own countries according to my legal experiences.
1. In case a seller, say, a Chinese seller substantially violates the contract and the foreign buyer, say, a Japanese buyer will have to file an application for arbitration against it in Japan, the international arbitration will inevitably last considerably long time. Among others, the international service of the legal documents is much time-consuming. In addition, the respondents usually intentionally refuse to receive the arbitration documents served from abroad, while the successful service is a necessary prerequisite for the validity of the arbitral award. What is more, even the Japanese buyer obtains a win arbitration award in Japan, it has to apply to a people’s court of competent jurisdiction for recognition and enforcement, which is definitely complex and time-consuming too.
2.During the process of an international arbitration held in one country, the foreign supplier or buyer in other country have enough time to apply for bankruptcy and liquidation to escape debts. It is not only hypothesis, but real cases I have encountered many a time in my practice in past decades.
3. In the era of globalization, the basic rules of civil and commercial laws in each country are almost the same, although the expression is different; and the reputation of the international arbitration tribunals, even in developing countries, say, Shanghai International Arbitration Center are nowadays not bad.
4.Should a buyer initiate arbitration against the foreign seller in the seller’s country, inter alia, the buyer may promptly apply to the local competent court in the seller’s country to freeze the properties and assets of the suppliers in time.