China’s First Specialist Financial Court Opens in Pudong
SHANGHAI, Nov. 14 – China’s first court dealing exclusively with financial disputes opened yesterday in the Pudong district of Shanghai.
The area is home to a specially created development zone, Lujiazui, which deals exclusively with banks and financial institutions, housing many of the primary global and Chinese players, such as HSBC, Citibank, the Bank of China, and AIG amongst 530 other international and Chinese institutions.
According to China Daily, the newly created Shanghai Court of Financial Arbitration will deal with banking, securities and insurance cases in amounts up to RMB50 million, and is operated as a division of the Shanghai Pudong New Area District People’s Court. The development is in response to an increasing number of financial lawsuits being issued in Pudong, with some 5,603 cases being filed in the past two years, including one for a RMB49 billion contractual loan dispute.
Specialist judges familiar with China’s financial regulatory system, supported by a panel of experts will preside in a move that at least gets some level of expertise into a judiciary often criticized for its lack of knowledge. Judges in China do not have to be trained as lawyers in order to be appointed. The success of the court will determine if other specialist courts will be established in China in the future. The court will initially feature a panel of three judges, supported by jurors with expertise in financial law.