Landmark Dubai-Shanghai judicial deal helps underpin Belt and Road

Danielle Green
Danielle Green

The cooperation, signed during Dubai Week in China, will smooth path for businesses seeking legal recourse in Dubai and Shanghai

A milestone agreement between two leading Dubai and Chinese courts of law could play a key role in supporting China’s Belt and Road initiative.

The deal, struck by Shanghai High People’s Court and DIFC Courts on the eve of Dubai Week in China, will strengthen bilateral cooperation between the two, paving the way for the judiciaries to work together more closely as commercial courts.

It is the first time Shanghai High People’s Court has worked in cooperation with a foreign court.

The agreement is being seen as a milestone supporting the Belt and Road initiative, with increased cooperation leading to greater certainty for businesses using Shanghai and DIFC Courts.

“Forging links with the world’s second largest economy is a strategic priority,” said Michael Hwang, DIFC Courts’ Chief Justice. “This agreement – a first for a foreign commercial court – creates a framework to support the growing number of firms operating between the UAE and China.”

DIFC Courts is an English-language common-law judiciary based in Dubai International Financial Centre (DIFC) with jurisdiction covering civil and commercial disputes nationally, regionally and worldwide.

Shanghai High People’s Court has jurisdiction over one of China’s most dynamic commercial hubs. In 2015, Shanghai’s total GDP reached approximately RMB 2,530bn.

In connected news, DIFC Courts and leading Chinese law firm King & Wood Mallesons have drafted a guide that promises to deliver increased assurance for businesses operating in both China and Dubai.

The enforcement guide covers commercial law across the whole of mainland China and the DIFC (Dubai International Financial Centre) free zone, which is an independent jurisdiction of the United Arab Emirates.

Compiled for the benefit of law firms and businesses, the guide offers a detailed explanation of how a DIFC Courts judgement can be recognised and enforced in China, and vice-versa. It is based on the existing 2004 Judicial Assistance Treaty between the People’s Republic of China and the UAE, and each court system’s own laws.

“China is Dubai’s number-one trading partner,” commented Michael Hwang. “This guide is a practical implementation of the Chinese government’s Belt and Road initiative. It delivers certainty for businesses operating in both China and Dubai.”

The deals come as Dubai is increasingly exploring ways to support China’s Belt and Road development strategy, which seeks to link China with Europe through Central and Western Asia. Due to its geographical position and world-class infrastructure and financial centre, the emirate is seen as a key entry point for investment into the region.

The second edition of Dubai Week in China, an event that celebrates the thriving bilateral relationship between China and Dubai, takes place 27-29 October at the Langham Hotel, Shanghai.