China: Lawyer or arbitrator: a problem in China - should the restriction be revoked?

Last Updated: 28 July 2013
Article by Ariel Ye, Harry Liu and Qiu Yue

PRC law sets forth specific requirements for individuals who serve as arbitrators in China. Article 13 of the PRC Arbitration Law requires arbitrators to be "fair and honest." Arbitrators must also meet at least one of the following qualifications: (1) have a minimum eight years work experience in arbitration; (2) have a minimum eight years experience as a lawyer or as a judge; (3) be engaged in legal research and teaching with a senior academic title; or (4) be engaged as a professional focused on economic and trade matters with a senior academic title or equivalent professional title also having legal knowledge.

Despite these specific criteria, PRC law did not initially place restrictions on lawyers who also act as arbitrators. The PRC Lawyers Law first promulgated in 1996 did not impose such restrictions nor did its 2002, 2007 and 2012 amendments. In 2010, however, the Ministry of Justice issued the Measures for Penalties of Lawyers and Law Firms for Illegal Acts ("Punitive Measures") which expressly prohibit lawyers who act or have acted as arbitrators from representing clients in disputes before the same institution where he or she is listed on the panel of arbitrators. Under Article 7.5 of the Punitive Measures, a lawyer who also acts as arbitrator before the same institution is considered a conflict of interest under Article 47.3 of the Lawyers Law which prohibits lawyers from "representing both parties in a same case, or representing a client in a legal affair that has conflict of interest with himself or his close relative." As set forth below, we believe that Article 7.5 is unwarranted, contrary to international arbitration practice, and serves little more than a vehicle for meritless challenges to the enforcement of arbitral awards and should be revoked.

Article 7.5 does not address intended concerns

It appears that Article 7.5 is intended to address concerns that a lawyer who acts as lawyer before the institution where he or she is listed as an arbitrator creates an opportunity for partiality and bias due to his or her relationship with the institution, thus impacting confidence and trust in arbitration proceedings. Given the attenuated relationship between arbitrators and institutions, however, we believe this concern is misplaced.

To begin, arbitrators and arbitral institutions maintain a fairly distant relationship. Unlike judges, arbitrators are not full time employees of arbitration institutions. They are appointed by a party or the institution to resolve one of many disputes at hand. The vast majority of arbitrators maintain full time professional careers outside of the arbitration institution, especially those who are practicing attorneys, and have limited communication with the arbitral institution in their role as arbitrator. Most communication between arbitrators and institutions is in writing, with arbitrators appearing before the institution only when hearings are conducted.

In addition, the institution's role during the arbitral proceedings is primarily limited to case administration. It is the tribunal, not the institution, who hears and reviews the merits of the dispute and determines and writes the award. The arbitral institution has no bearing on the outcome of the dispute.

While Article 7.5 may in theory be intended to prevent partiality and bias due to a litigant's relationship with the arbitration institution, we believe it is misplaced. Certainly there may be other relationships which give rise to justified concern, but we do not believe that the attenuated nature of the arbitrator-institution relationship creates an opportunity for a lawyer who is also listed as an arbitrator to impact other proceedings administered by that institution.

Article 7.5 restricts lawyers from acting as arbitrators and hinders development of commercial arbitration in China

As noted above, China, unlike many other countries, sets forth specific criteria for the inclusion of individuals in an institution's list of arbitrators. As a result, lawyers who serve as arbitrators in China are legal experts with extensive expertise in a wide array of fields and industries. Practicing lawyers occupy a significant percentage of domestic and international arbitrator lists. For example, one-third of arbitrators listed with the China International Economic and Trade Arbitration Commission (CIETAC) are practicing attorneys. Their involvement and insight in the resolution of commercial disputes have made an important and valuable contribution to the development of commercial arbitration in China.

Given the nature of arbitrator appointments, most of these lawyers maintain separate professional careers and derive their income primarily from private practice. Due to restrictions on the number of arbitration institutions which may exist in each municipality, most cities only have one arbitration institution and institutions capable of resolving foreign-related disputes are even more limited. For lawyers listed as arbitrators in institutions in the locality in which they practice, Article 7.5 is likely to have a significant impact on their ability to represent clients before those institutions.

Being listed as an arbitrator is a symbol of prestige and often a valuable qualification for litigators in China. Nonetheless, we believe that continued application of Article 7.5 will force most lawyers to walk away from their role as arbitrators in order to maintain their professional careers and their livelihood, thus depleting the pool of qualified arbitrators in China and potentially stalling or even diminishing the development of commercial arbitration in China. It turns out to be especially worse for over hundreds of local arbitration commissions. Lawyers take up a substantial portion of arbitrators in local arbitration commissions, because the number of qualified legal professionals is relatively small due to geographical restrictions. The restriction of Article 7.5 on lawyers will definitely have a more profound negative impact on the developments of local arbitration commissions.

Article 7.5 is inconsistent with international arbitration practice

In international practice, a lawyer who appears before an arbitration institution where he or she is listed as an arbitrator is generally not deemed a conflict of interest. The rules of most international arbitration institutions also do not restrict this practice. Indeed, many leading international arbitration practitioners are listed as arbitrators with the very same institutions before which they litigate cases.

Nor has the international arbitration community determined a lawyer's dual capacity as litigator and arbitrator before a single institution to be a conflict of interest. In 2004, the International Bar Association published the IBA Guidelines on Conflicts of Interest in International Arbitration ("IBA Guidelines"). The IBA Guidelines are the product of leading international arbitration practitioners and scholars who set forth a list of scenarios deemed to constitute waivable and non-waivable conflicts of interest. The restrictions set forth in Article 7.5 are not included in this list. In fact, the only situation addressed by the IBA Guidelines that is remotely similar to Article 7.5 is where an arbitrator and counsel have previously served together as arbitrators or co-counsel, and the IBA Guidelines do not consider this alone to be a conflict.

Article 7.5 increases the likelihood that enforcement of an arbitral award will be challenged

While Article 7.5 does not expressly address arbitration procedure or rules, it creates a basis to challenge enforcement of an arbitral award. For example, after the Punitive Measures were issued, a single PRC intermediate court was faced with three cases in which the parties applied to set aside arbitral awards based on alleged violations of Article 7.5. In 2011, the court agreed with the applicant and set aside the award because it viewed violation of Article 7.5 to constitute a violation of arbitration procedure. In 2012, however, the same court overruled two applications to set aside arbitral awards on the same grounds because it considered the Punitive Measures to be a departmental decree and not binding legislation. Accordingly, it is unclear whether a violation of Article 7.5 amounts to a violation of arbitral procedure warranting refusal to recognize or enforce an award or whether Article 7.5 is merely an ethics rule governing lawyer conduct. We expect that other PRC courts adopt similar inconsistent approaches thus injecting further uncertainty to the finality and enforceability of an arbitral award in China.

Closing remarks

In practice, Article 7.5 is seldom applied. The Punitive Measures only bind lawyers and law firms, not arbitration institutions, though they may be referenced by institutions. Only a few arbitration institutions, such as the Beijing Arbitration Commission and the Shenzhen Arbitration Commission, have issued rules consistent with Article 7.5. The majority of institutions do not have such rules. Unless an objection is raised by the other side, lawyers rarely withdraw from their representation of clients when Article 7.5 scenarios arise. Even if an objection is raised, arbitration institutions are not in a position to compel a lawyer to withdraw as counsel. Article 7.5 also has no impact on offshore arbitration institutions. Because Article 7.5 does not distinguish between domestic and offshore arbitrations, however, it is unclear whether it applies to a PRC lawyer listed as an arbitrator before an offshore institution.

Some members of local bar associations point out that the initial purpose of Article 7.5 was to avoid potential challenges to arbitral awards based on alleged conflicts of interest resulting from the lawyer's role as a listed arbitrator. They suggest that the Ministry of Justice is aware that the impact of Article 7.5 may have resulted in the opposite effect and accordingly Article 7.5 has not been strictly enforced. Nevertheless, Article 7.5 remains valid and binding. This inconsistency between practice and legislation has created additional legal uncertainty, with many lawyers uncertain as to the scope and application of the restrictions imposed by Article 7.5. To align China with international arbitration practice and restore certainty to arbitration practice in China, Article 7.5 should be immediately revoked.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions