White Paper of the People’s Court of Shenzhen Qianhai Cooperation Zone on Serving and Safeguarding Development of Free Trade Zone

1.        Intensify Judicial Functions of Free Trade Zone and Reinforce Judicial Standardization and Guidance

(1)     Development Characteristics and Trends of Free Trade Zone Reflected Through Cases of the Zone

Qianhai Court has jurisdictions over the civil and commercial cases of trial of first instance within Qianhai Cooperation Zone which are to be governed by the grassroots courts and centralized jurisdictions over the foreign-related and Hong Kong, Macao, Taiwan-related commercial cases of trial of first instance within Shenzhen City which are to be governed by the grassroots courts as well as the ordinary intellectual property cases of trial of first instance within Qianhai Shekou Free Trade Zone.

①　Cases involved in Qianhai Free Trade Zone account for 53% of all cases involved in the free trade zones of Guangdong Province.

Since February 2, 2015, Qianhai Court has begun to accept cases, and has accepted 7,584 cases in total until June 30, 2017, including 4,255 cases involved in the free trade zone and cooperation zone which account for 56% of all the cases the Court has accepted, or for the purpose of the type of these cases including 2,159 civil and commercial cases and 2,096 enforcement cases. In the civil and commercial cases, there are 410 commercial cases related to investment and trade, 384 commercial cases related to finance, 105 intellectual property cases, 40 real estate cases and 867 labor dispute cases (as specified in the Diagram). According to the statistical data of the Judicial Safeguard White Paper of China (Guangdong) Pilot Free Trade Zones, from the establishment of Qianhai Court, cases accepted by the Court involved in the free trade zone account for about 53% of the cases accepted in China (Guangdong) Pilot Free Trade Zones including Qianhai Shekou of Shenzhen, Guangzhou Nansha, Zhuhai Hengqin and Guangzhou Maritime (as specified in a separate Diagram). The number of cases reflects to some extent Qianhai Free Trade Zone’s achievements in deeply advancing reform and innovation and expanding open-up as well as strong vigor and vitality of the Zone.

②　Cases involved in free trade zone saw year-on-year rises of 314%, reflecting that business market entities have become increasingly active in Qianhai Free Trade Zone. Since establishment of Qianhai Court, cases accepted by the Court involved in free trade zone has risen sharply. The Court accepted 1,086 cases in total in 2015 including 427 cases involved in the free trade zone and cooperation zone, 3,990 cases in total in 2016 including 1,769 cases involved in the free trade zone and cooperation zone, and 3,046 cases in total from January 1 to June 30, 2017 including 1,965 cases involved in the free trade zone and cooperation zone. The number of cases accepted in 2016 involved in the free trade zone increased by 314% than that in 2015. Since founded, Qianhai Cooperation Zone and Free Trade Zone has attracted a large number of enterprises. Until the end of 2016, there has been 124,600 registered enterprises in Qianhai Zone including 53,088 registered enterprises newly increased in 2016, seeing a year-on-year rises of 23.9%, a sharp increase for the newly-established enterprises. The four leading industries - finance, modern logistics, information service and science and technology service - increased by 95.3%. As the newly-established enterprises go into ordinary operation, related commercial disputes such as trade disputes and disputes in respect of the establishment of companies and transfer of equities have arisen. Thus, there is also a rapid increase in judicial demands, which represents the vitality of economy and the development of the emerging business pattern.

③　Cases involved in free trade zone include those related to finance, information and technology, etc., reflecting that the free trade zone has been continuously absorbing the innovation-oriented industries. Qianhai Free Trade Zone has furthered the reform in facilitation of trade and investment. Through institutional and mechanism innovation of the facilitation of trade and investment and the opening of cross-border investment and financing and service industry, relevant industries have gradually gathered there in the free trade zone. First, commercial cases related to finance account for a large proportion, which reflects the free trade zone’s preliminary achievements in promoting the open-up of the financial industry. As of the end of 2016, there have been 51,188 registered financial enterprises in Qianhai Zone including 195 licensed financial institutions. The business scales of commercial factoring and financial leasing rank first and third respectively, making it become China’s largest gathering place for new and similar financial institutions. From February 2015 to June 2017, Qianhai Court accepted 384 financial and commercial dispute cases involved in the free trade zone, accounting for 9.02% of the cases involved in the zone. Second, there is a sharp increase in new type of disputes such as financial leasing disputes, commercial factoring disputes and other financing disputes of non-financial institutions. From February 2015 to June 2017, Qianhai Court accepted 61 financial leasing dispute cases, 28 cases related to factoring contracts and 50 equity financing dispute cases. As a new financial industry most closely integrated with the real economy, the financial leasing industry has experienced a rapid growth after being stimulated by a series of innovation policies of the free trade zone. According to statistics, among financial and similar financial enterprises registered in Qianhai, there are 324 financial leasing enterprises, accounting for 95% of the same type of enterprises in Shenzhen and 13% of the same type of enterprises in China, and such financial leasing enterprises maintain growing in the most rapid rate in China. There are 2,961 commercial factoring institutions in Qianhai, accounting for two-thirds of the same type in China. However, institutional coordination and risk awareness of the transaction subject are relatively backwards, so that there is a rapid increase in financial leasing disputes. Third, financial disputes related to internet have constantly arisen. From February 2015 to June 2017, Qianhai Court accepted 167 internet financial dispute cases, mainly including P2P disputes. As financial innovation under the background of “Internet +” presents a diversified development pattern, there appears a rapid growth in such new financial transaction patterns as online payment, virtual currency, financial network loan and P2P network credit, which reflects that there exist highly active capital markets and strong demands for funds in Qianhai Shekou Free Trade Zone and also corresponds to the Free Trade Zone’s positioning for relying on Shenzhen-Hong Kong deep cooperation to promote the open-up and innovation of internationalized finance. Fourth, informal lending disputes arise frequently. As of June 2017, the Court has accepted 1,272 informal lending cases involved in the free trade zone. The frequent occurrence of informal lending disputes reflects to some extent that there are strong fund demands for Qianhai’s market entities during their enterpreneurship development period and highly active capital markets and that social credit system and supervision mechanism corresponding thereto have not been completely established. Fifth, E-commerce transaction platforms such as cross-border E-commerce platform are growing rapidly. From February 2015 to June 2017, the Court accepted 20 cross-border E-commerce cases in total, which disputes were mainly focused on the quality of products imported through cross-border E-commerce. Currently, Qianhai takes advantage of the location of Shenzhen-Hong Kong Cooperation, the operation of bonded port area and the support of national policies to strongly advance the development of cross-border E-commerce, and has formed China’s first Shenzhen-Hong Kong cross-border E-commerce security demonstration zone, seeing a year-on-year increase of over 80% in the import and export for the cross-border E-commerce industry. The emerging transaction methods bring new challenges for industry supervision and regulation at the same time when they satisfy the demands of diversified market entities.

④　Foreign-related and Hong Kong, Macao, Taiwan-related cases account for a proportion of about 50%, reflecting the free trade zone’s continuously enhanced capability of implementing national development strategies and serving Shenzhen-Hong Kong Cooperation. By impartially and efficiently hearing foreign-related and Hong Kong, Macao, Taiwan-related commercial cases (the “Four ‘Relateds’ Cases”), Qianhai Court endeavors to promote Qianhai’s innovation and development-oriented open economy, enhance inter-regional and international deep cooperation, and serve China’s open-up and development strategies as well as the “Belt and Road” Initiative. From February 2015 to June 2017, the Court accepted 3,169 “Four Relateds” Cases including 2,293 Hong Kong-related cases, accounting for 72.36% of all the “Four Relateds” Cases (as specified in the Diagram). First, cases related to Hong Kong-involved enterprises have increased rapidly. In 2016, the Court accepted 1,211 Hong Kong-related commercial cases, an increase of 164.99% compared with the same period of the year 2015, which reflects the achievements made by Qianhai Free Trade Zone through deepening industry cooperation between Shenzhen and Hong Kong, making innovation in the management pattern for admission of foreign investment and attracting Hong Kong-invested enterprises. As of the end of 2016, there have been 4,223 registered Hong Kong-invested enterprises in the Zone and an added value of RMB39.261 billion realized by these registered Hong Kong-invested enterprises, accounting for a proportion of 27.7% of that of the free trade zone. Second, foreign-related and Hong Kong, Macao, Taiwan-related financial borrowing and financial leasing disputes have increased. Qianhai Court accepted 172 cases in connection with foreign-related and Hong Kong, Macao, Taiwan-related financial borrowing and financial leasing disputes in 2015 and 274 cases related to the same type of disputes, seeing a year-on-year increase of 59.3%. Qianhai Free Trade Zone takes the lead in promoting the realization of “Five Cross-Borders”, i.e. cross-border RMB lending, cross-border two-way bond issuing, cross-border two-way capital pool, cross-border two-way equity investment and cross-border asset transfer, and strives to optimize the allocation of offshore resources, promote Shenzhen-Hong Kong cooperation in financial leasing businesses and establish an ecological circle for developing Shenzhen-Hong Kong cross-border financial leasing industry. The growth of financial borrowing and financial leasing reflects that foreign-related market entities have a stronger demand for cross-border financing. Third, outbound laws such as Hong Kong laws are applied to hear cases. When hearing foreign-related and Hong Kong, Macao, Taiwan-related cases, we fully respect the right of the parties concerned to choose applicable laws and safeguard their lawful rights and interests pursuant to international conventions and international customs and practices (if applicable) to improve inter-regional and international judicial credibility. In order to respond to the demands of commercial entities in the free trade zone for applying to outbound laws, Qianhai Court reinforces legal discovery and application of outbound laws. In the case in respect of “the Financial Leasing Contract Disputes, D Bank v.s. L Company”, the Hong Kongese mediator caused the parties concerned to reach a mediation agreement upon mediating in accordance with Hong Kong laws. This case was selected as one of the “Ten Typical Judicial Safeguard Cases of Guangdong Free Trade Zones”, which has attracted much attention of all circles of the society and gained much potential for absorbing foreign funds in Qianhai.

(2)     Unify Application of Law and Clarify Judicial Judgment Rules of Cases Involved in Free Trade Zone

①　Implement judicial safeguard in free trade zone to enhance commercial entities’ confidence in investing and starting businesses. On May 5, 2015, Qianhai Court formally issued the Opinions on Providing Judicial Safeguard for Establishment of Free Trade Zone and Cooperation Zone, which is China’s first judicial safeguard opinions provided for free trade zones after expansion of free trade zones. The Opinions include 6 chapters divided into 51 articles and describe specific judicial safeguard measures in respect of function positioning, judicial philosophy, judicial functions, judicial reform, judicial services and team building, etc. Based on the function positioning of Qianhai socialist rule-of-law demonstration zone, the Judicial Safeguard Opinions actively respond to the issues that commercial entities in the free trade zone are generally concerned about and enhance their confidence in investing and starting businesses. In three months after the establishment of Qianhai Court, it promptly issued the Judicial Safeguard Opinions, which has given full play to judicial prospectiveness and functions of serving overall interests of the country and made the rule-of-law construction of Qianhai Shenzhen-Hong Kong Cooperation Zone upgrade to a new height. Moreover, we endeavor to establish a social guidance mechanism and judicial safeguard mechanism featuring the rule-of-law thinking and pattern to support Qianhai carving out a way for the construction of socialist rule of law with Chinese characteristics.

②　Publish guidelines for trial of cases involved in free trade zone to ensure there are rules to be followed by main industries in the zone. Based on the industry development status and the dispute features of the free trade zone and cooperation zone as well as different requirements of various industries for judicial work, Qianhai Court has issued and implements the Guidelines for Trial of Cases Involved in Free Trade Zone and Cooperation Zone, which contains such contents as case filing, service, property preservation, hearing, enforcement, judicial mechanism and extension in respect of the cases involved in the free trade zone and cooperation zone, specifies the judicial mechanism for trial of eight types of cases related to contracts, finance, companies, financial leasing and intellectual property and unifies judgment criteria and standards, so that the expectability of judicial judgment is to be increased. Meanwhile, we endeavor to strengthen special tracing and analysis of cases involved in key fields and will regularly publish typical cases heard in the free trade zone to provide case guidance for business operation of market entities, so as to effectively play judicial judgment’s role in maintaining fair, transparent and expectable market orders and promote an open and innovation-oriented business environment in the free trade zone and cooperation zone.

③　Formulate guidelines for trial of new type of dispute cases to safeguard standardized development of innovation-oriented industries in the free trade zone. Qianhai Court actively explores guidelines for trial of new type of dispute cases, promotes the clarification and specification of judgment elements and legal basis of new types of cases, and provides guidance for benign development of new industries by impartially hearing new cases. As to rapid growth of financial leasing industry and factoring industry in the free trade zone, the Court published and implemented the Guidelines for Trial of Factoring Contract Dispute Cases of Qianhai Free Trade Zone (Trial Version) and the Guidelines for Trial of Financial Leasing Contract Dispute Cases of Qianhai Free Trade Zone (Trial Version) in January 2017 to give further play to judicial guidance and encourage innovation and development of the emerging industries in the free trade zone. The Financial Leasing Guidelines standardize such aspects as the determination of financial leasing relationship, the application of law to foreign-related and Hong Kong, Macao, Taiwan-related financial leasing cases and the effects of registration and publication; while the Guidelines for Trial of Factoring Contract Dispute Cases are formulated specifically to hear factoring dispute cases and specify such aspects as case governing, identification of the parties concerned, effects of factoring contracts, transfer of account receivable, right relief of factors, debtors’ rights of defense and set-off. Furthermore, the Court makes greater efforts to explore “Valuation Adjustment Mechanism” disputes in the field of investment, legally deal with disputes between consumers and cross-border E-commerce enterprises and support the pilot free trade zone in developing cross-border E-commerce service, so as to provide powerful judicial safeguard for the free trade zone establishing an open and innovation-oriented economic system.

(3)     Publish Typical Cases to Strengthen Judicial Demonstration and Guidance for Commercial Behaviors in Free Trade Zone

On the premise of persisting in freedom of contract and respecting marketing rules, Qianhai Court expands the application of law and legally protects innovation and business operation measures not expressly provided by law but beneficial for economic and social development of the free trade zone. In October 2016, the Court published the first batch of ten typical cases involved in Qianhai Free Trade Zone and Cooperation Zone.

①　Effectively deal with disputes arising from commercial innovation to standardize and guide commercial behaviors closely related to the development of the free trade zone. The leading industry of Qianhai is production-oriented service industry mainly including financial industry, modern logistics industry, information service industry, sci-tech service industry and professional service industry. The typical cases published that time are closely focused on the industries led by Qianhai, among which new type of cases account for more than half of these cases, including cases in respect of “undisclosed factoring”, “leaseback financial leasing” and “share-based transaction of artworks”, etc. Among these cases, 50% of them are relevant to business lending and financing, such as the Financial Leasing Case, Baoli Company v.s. Zhao” and the commercial factoring case about International Trust & Investment Corp. (“ITIC”) providing financing for Tiangu Company; 20% are involved in international sales of goods, such as the “International Goods Sales Contract Dispute Case, Qingcheng Company v.s. ILHAMI” and the “Sales Contract Dispute Case, Qixiang Company v.s. RGB Company”; and others are related to financial derivatives disputes and protection of laborers’ rights and interests.

②　Fill the hole in judicial precedents to provide ideas and judgment criteria for dealing with disputes. As the industries such as financial industry and trade industry are constantly growing in the free trade zone, there must appear new type of disputes to be resolved in the process of going and trying beforehand and continuously exploring, and there must be challenges such as unclear application of law in judicial practice. For example, in the “Financial Derivatives Transaction Dispute Case, Gan v.s. Huifeng Company”, the dispute was incurred in connection with the share-based transaction of artworks. As an emerging method integrating finance with artworks market, the share-based transaction of artworks is an exploration in asset securitization of the free trade zone, which is not specifically prescribed by law currently in effect. On the premise of persisting in freedom of contract and respecting marketing rules, Qianhai Court impartially and properly concluded this case in accordance with the Contract Law, which reflects the Court’s open judicial attitude towards the innovation of financial industry and effectively fills the hole in judicial precedents applicable to disputes related to the share-based transaction of artworks, having provided ideas and experience for identifying and dealing with similar cases. Further, through the “Labor Dispute Case, Chen v.s. Tonghe Company”, the dispute in respect of application of law incurred as a result of the commercial confidentiality fee not expressly provided by law has to some extent resolved, which is beneficial for unifying judgment criteria so as to provide reference for future judgments.

③　It is generally of directive significance for standardization and guidance of marketing behaviors of the free trade zone to promptly express judicial attitude towards commercial behaviors. Relevant industries of the free trade zone are still in innovation and exploration, it is necessary for these industries to be guided by rule of law, so as to standardize marketing behaviors of Chinese and foreign commercial entities. There have been more than 1,600 commercial factoring companies registered in Qianhai, ranking first in China. The business operations of commercial factoring companies in Qianhai are continuously innovative. In the case (ITIC v.s. Tiangu Company) in respect of undisclosed factoring, a verdict was made in favor of the undisclosed factoring, which is beneficial to the demands of small and medium-sized enterprises for financing and to guiding the sound development of commercial factoring in the free trade zone and cooperation zone. International goods sales is one of the major business activities in the free trade zone. In the “International Goods Sales Contract Dispute Case, Qingcheng Company v.s. ILHAMI”, the plaintiff was not supported by the Court due to failure to produce evidence that the International Goods Sales Contract is concluded. This case reminds commercial entities that it is necessary to enter into contract and keep related evidences such as notes and instruments in international sales of goods, so as to avoid the result of failure to produce evidence when dispute arises. Foreign-related financial leasing is a common financial product in Qianhai and it is a matter that most Hong Kong-funded enterprises are concerned about whether Hong Kong law is applicable to financial leasing disputes. Through the “Financial Leasing Contract Dispute Case, D Bank v.s. L Company”, it was announced that Hong Kong law or outbound law could be applicable to cross-border financial leasing disputes, which would increase confidence of commercial entities of foreign countries and Hong Kong, Macao and Taiwan in investing and starting businesses in Qianhai.

2.        Establish Sound Judicial Service Mechanism and Demonstrate Characteristics of Socialist Rule-of-Law Demonstration Zone

(1)     Create Convenient and Highly-Efficient Dispute Resolution Mechanism Satisfactory to Demands of Market Entities

①　Set up an internationalized professional dispute resolution platform to enhance commercial entities’ initiative and convenience in resolving disputes. On May 28, 2016, the litigation-mediation docking center was formed at Qianhai Court, which provides a diversified litigation and non-litigation docking platform operating normally and complete in function and promotes the formation of a diversified dispute resolution pattern led by the country, pushed by the Justice and participated in by the social public, so as to positively correspond to the urgent demands for efficiently resolving disputes arising out of rapid development of the free trade zone. Rimsky Yuen, Secretary for Justice of HKSAR, believes that for the purposes of Hong Kong-related cases, the third-party evaluation system created by the litigation-mediation center of Qianhai Court reflects the prospectiveness and foreseeability in mediating Hong Kong-related commercial affairs in Qianhai. Secretary Yuen also expects that there would be much cooperation between Hong Kong and Shenzhen in developing strategic service and internationalized talents so as to jointly provide all-round legal service for the “Belt and Road” Initiative. The litigation-mediation center of Qianhai Court has cooperated with such institutions as Shenzhen Lawyers Association, Hong Kong Mediation Center, Guangdong-Hong Kong-Macao Mediation Alliance, and the Mainland-Hong Kong associated law firms of the free trade zone and brought commercial mediation organizations, industry mediation organizations and other local and overseas mediation organizations into the Court so as to make the mediation mechanism and team internationalized.

②　Set up a sound scientific litigation-mediation docking mechanism to effectively relieve litigation exhaustion of the parties concerned and improve efficiency in resolving disputes. To fully respect diversified cultural backgrounds of the parties concerned both at home and abroad, Qianhai Court has worked together with the integrated management organization, administrative authorities, arbitration organizations, administrative mediation organizations and people’s mediation organizations to establish docking coordination mechanism and create a register of in-house mediators, in which there are 122 mediators in total including 46 mediators from abroad or Hong Kong, Macao and Taiwan. The parties concerned may decide in their sole discretion to resolve disputes by way of non-litigation such as mediation or arbitration, and they are encouraged to resolve disputes first by reaching a compromise through negotiation. We also encourage lawyers to lead the parties concerned to mediate first. Moreover, the in-house mediators, related specialists or other persons may, upon application or being entrusted by the parties concerned, participate in the negotiation to provide coordination or assistance for dispute resolution.

③　Implement mediation first and optimize dispute resolution procedures to promote commercial entities to resolve disputes in a harmonious way. The “Mediation First” procedure is implemented to promote the parties concerned to have a relatively clear understanding of the fact and points at issue and have a prior awareness of legal risks to be faced by them so that disputes could be resolved as soon as possible. The civil and commercial disputes in respect of which the parties concerned have initiated legal proceedings with the people’s court, will be identified by and assigned to the case-filing personnel or professional mediators of the litigation-mediation docking center. We introduce the associated law firms in the free trade zone to mediation. For those cases suitable for mediation, the parties concerned are to be guided for mediation; and before case filing, the cases will firstly be handed over to the in-house mediation organizations or mediators or assigned to social mediation organizations for mediation. From the date of its establishment to June 2017, the litigation-mediation docking center accepted the mediation of 510 disputes and 327 disputes were successfully resolved through mediation with a success rate of 64.1%. Among all disputes successfully resolved through mediation, 197 of them were resolved by the in-house mediators (accounting for 60.2% of all such disputes), including 96 disputes resolved successfully by the Hong Kongese mediators, accounting for 48.73% of those successfully settled by the in-house mediators (as described in the Diagram). During the whole process from case filing to hearing, the parties concerned are encouraged to resolve disputes actively by way of mediation. If any party concerned objects against or impedes mediation without proper and sufficient reasons, the judge may order such party to take related adverse consequences by adjusting the allocation of court cost and attorney fees.

(2)     Extend Judicial Radiation Functions to Create an Open and Inclusive Investment and Trade Environment

①　Promote judicial openness to intensify transparent and sun justice of the free trade zone. Qianhai Court interacts with the public through judicial openness and service to deepen and widen judicial openness, promotes the establishment of four open platforms, i.e. to make the judgment procedures, judgment instruments, enforcement information and court hearing open to the public (with 1,974 judgment instruments having been made open to the public), and has constituted an intensive judicial openness pattern integrating online litigation service, appointment for sitting in court hearing, live broadcast of court hearing and publishing of typical cases and related information of the court. In addition, the Court will continuously support the traditional channels for judicial openness such as the court website, press release conference and “Court Open Day”, intensify the efforts internet live broadcast of court hearing to make it broadcast live for everyday, every case and everybody, and expand channels for judicial openness and rule-of-law publicity via such new media as WeChat and Weibo, so as to make people feel about “visible justice”.  By means of the court website, press release conference, open day and live broadcast of court hearing and through the important matters and typical cases published at the eight press release conferences organized by Qianhai Court since its establishment, such as providing judicial safeguard for the free trade zone, excellent judgment strategy and guidelines for trial of cases involved in the free trade zone, the Court standardizes behaviors of market entities and provides guidance for such entities to make them have a prudent understanding of financial innovation, which has attained good social effects. To achieve judicial openness, Qianhai Court will organize the Court Open Day in every quarter, and more than 80 members of the people’s congresses and the people’s political consultative conferences at national, provincial, city and district levels have visited the Court three times for investigation.

②　Intensify litigation service and build smart-oriented, people-oriented and standardized judicial service functions. Establish a people-oriented “one stop” litigation service center integrating litigation guidance, case-filing registration, petition consultation and judicial publicity; implement litigation measures convenient for people such as hotline service, online consultation, on-site Q & A, appointment for case filing and demonstration of litigation instruments; based on the establishment of intelligent court system, advance the handling of business on internet and implement online case filing to provide convenient judicial service for litigants and the social public; strengthen institutional establishment, legally publicize the court’s hearing and filing of cases, actively provide timely and convenient file searching service, clarify the time and requirements for handling the service and enhance coordination to further promote the standardization of litigation service. Since establishment over two years ago, Qianhai Court has issued more than 80 standardized documents and formulated several litigation guidelines, including 50 pieces of “Litigation Instructions”, to provide all-round litigation service.

③　Strengthen establishment of legal professional community to advance judicial service of the free trade zone with common professional philosophy. Qianhai Court entered into the Cooperation Memorandum for Pushing Establishment of Legal Professional Community with Shenzhen Lawyers Association to positively push the establishment of legal professional community, build a good interactive relationship between judges and lawyers for mutual respect, mutual trust and mutual supervision, jointly safeguard the core value of rule of law and bear the mission for rule-of-law construction. The Court implements the mechanism that the Lawyers Association designates lawyers to join in the Court on each Wednesday. From August 2016 to June 2017, the lawyers provided such services as legal consultation and dispute mediation for more than 80 times. Furthermore, Qianhai Court is focused on exerting the team advantages of various legal professional communities and based on the geographical features of Qianhai, works together with 13 organizations such as Guangdong-Hong Kong-Macao Mediation Alliance, Hong Kong Chamber of Commerce in Qianhai Shenzhen, Shenzhen Arbitration Committee and Hong Kong Mediation Center, etc., enhances exchange and cooperation with outbound judicial organizations, arbitration organizations and mediation organizations, so as to improve international competitiveness in dispute resolution mechanism.

(3)     Assist Government of Free Trade Zone in Functional Transition by Social Governance Risk Warning

①　Promote establishment of honest society in the free trade zone. Formulate the Certain Provisions for Prevention and Punishment of Dishonest Litigation Behaviors; restrict such dishonest litigation behaviors as litigation drag, malicious litigation and false litigation, strongly crack down the “deadbeat” individuals and dishonest enterprises and set up a new supervision pattern for social credit systems to be pushed by justice, so as to perfect the open economic security system; if any public information reported by any enterprise is found not in conformity with the fact in the case hearing, the Court will promptly give notice to the industry and commerce administration authorities and the authorities will record such enterprise in the abnormal business list and make it open to the public, so as to procure market entities to consciously improve their credit.

②　Coordinate in management and innovation by means of judicial suggestions. For those emerging problems of tendency characters found in court hearing such as loopholes in the system, marketing risk and industry supervision, Qianhai Court will actively negotiate with the governmental departments and make judicial suggestions to help the government set up a better administration mechanism which is more efficient in service and supervision and cooperate in promoting the establishment of the free trade zone. For example, with the rapid development of commercial factoring businesses in Qianhai Cooperation Zone, there are more and more invisible commercial factoring disputes. We therefore suggest that related authorities of the free trade zone should issue corresponding administrative guidance documents to standardize the development of commercial factoring industry and should establish or perfect factoring approval system. For off-site fund matching disputes arising from the fluctuations of securities market, we suggest that related governmental departments improve standards for off-site fund matching and strengthen coordination and joint law enforcement among different departments to intensify the supervision and guidance of off-site fund matching behaviors. For the matter that the “Double-side” interest rate of micro-credit companies harms the rights and interests of borrowers, we suggest that related departments intensify the rule-of-law publicity and supervision.

③　Set up a warning mechanism for important sensitive cases. Actively extend judicial functions; integrate relief afterwards and prior judgment with guidance;  promptly summarize legal matters reflected in cases in respect of market supervision, industry self-discipline and risks in business operation of the free trade zone and cooperation zone; establish dynamic tracing, research and judgment mechanism and important sensitive case marking system; clarify internal management procedures and external information reporting mechanism to form warning report in the case-filing registration and judicial enforcement; establish direct access system for warning report of import sensitive cases; work together with related functional departments and industry organizations to set up feedback mechanism for ordinary contact, information reporting and risk warning, open communication channels and strengthen judicial participation in the innovation of social governance.

3.        Implement Comprehensive Judicial Reform in an All-Round Way and Set up Judicial System and Mechanism Suitable for Development of Free Trade Zone

(1)     Establish Scientific, Streamlined and Efficient Judicial Administration System to Effectively Improve Judicial Resources Allocation in Free Trade Zone

Based on the separation of judicial power and judicial administration power, Qianhai Court built the court operation framework highlighting the core position of judgment, which laid out a foundation for serving and safeguarding the establishment of the free trade zone.

①　Establish judicial administration system in conformity with judicial principles and highlight the core position of judgment. With the separation of the court’s administration power and judicial power at its core, create more scientific and standardized power list and business list to completely separate judicial administration and judicial judgment in respect of organizational structure and personnel allocation. Qianhai Court set up a horizontal judgment organization structure centering on judges and has no business tribunal. Build the “1+2+1” judgment team including 16 chief judges; make scientific allocation of the judgment team and explore intensive management and judicial assistance to improve the quality and effects of judicial work.

②　Focus on serving the judgment and set up streamlined, highly-efficient, horizontal judicial administration organizations.There are only two comprehensive departments, i.e. Judicial Administration Affairs Office and Trial Affairs Office, which make Qianhai Court become most streamlined in internal organizations in China, demonstrates the characteristics of judicial administration serving judgment and improves the efficiency in judicial administration. Set up judicial administration decision mechanism, clarify and standardize work duties of the judicial administration affairs management organization, and form a judicial administration system which is reasonable in mechanism, clear in relationship, complete in function and highly efficient in operation.

③　Establish judges conference system to highlight judges’ principal position and judicial autonomy. Qianhai Court established the judges conference system to highlight judges’ principal position and judicial autonomy and implement judges’ self-management and self-constraint. Since establishment, the Court has held 24 judges conferences, in which 89 items such as adjudication management system and judicial reform program were approved upon discussion. It laid out an institutional framework for comprehensive judicial reform of Qianhai Court.

(2)     Perfect Judicial Power’s Operation Mechanism Consistent in Power and Responsibility and Orderly in Supervision to Ensure Organic Unification of Judicial Judgment and Judicial Responsibility of Free Trade Zone

Promote legally independent enforcement of judicial power and intensify reasonable management and supervision of judgment at the same time, to ensure that judicial power is “decentralized but not indulged”, judges hear cases “independently” but not isolatedly and the management and supervision of judgment is implemented in but not out of place.

①　Create a list of judicial power and judicial supervision power to ensure that judges exercise judicial power legally and independently. Formulate the “Guidelines for Implementation of Judicial Responsibility System” to strictly implement the “president and vice president handling cases” mechanism, carry out the whole-process tracing and filing system for enforcing judicial supervision power. The president and vice presidents must hear cases in the capacity of judge and may not “approve or make judgments of” cases not heard by them. In 2017, the president and two vice presidents heard 96 cases in total.

②　Set up more scientific mechanism for managing case quality to comprehensively supervise the quality and effects of cases throughout the whole process. Set up scientific case evaluation standards and third party specialist evaluation mechanism; invite the retired senior judges and 20 scholars from Beijing University as case quality evaluation specialists to evaluate case quality scientifically and reasonably and summarize judgment experience in a timely and efficient way; set up warning reporting and tracing supervision mechanism to prevent and solve outstanding problems which have influence on case handling quality.

③　Set up a case-handling responsibility evaluation mechanism to demonstrate differentiated and precise accountability. Further connect case quality evaluation and judges’ evaluation and clarify the nature of case quality differentiation and the standards for identifying judges’ responsibility for misjudging cases, to allocate different responsibilities to different subjects of responsibility. If there is any misjudged case due to the chief judge’s failure to properly perform his duties, he will assume main responsibility and other members of the collegiate panel shall bear different responsibilities respectively based on their labor division and responsibilities. The responsibility for misjudging cases will be recorded in the performance file and may be influential on judges’ evaluation, appraisal of excellence and promotion.

(3)     Perfect Classification Management and Maintain Powerful Judicial Personnel Management System to Build a Professionalized Judicial Team Suitable for Free Trade Zone

①　Promote the reform in the system of specified number of judges and the professionalism of judges to build an elite judge team. Establish relatively fixed and dynamically adjustable number of judges system and implement the specified number of judges management system integrating stimulation and restriction mechanism; implement professionalism in judges, having established an independent salary system corresponding to judges’ levels and further opened the channel for judges’ promotion.

②　Implement the reform in professionalism of ancillary judicial personnel to improve professional safeguard and quality. Implement the classification management of judicial personnel; formulate the Guidelines for Assistant Judges’ Work and the Guidelines for Judicial Administration Personnel’s Work; create job sequence based on different professional characteristics and job features of ancillary judicial personnel and judicial administration personnel to clarify job duties, work standards and procedures of different types of personnel. Solve problems in respect of professional safeguard of the employed assistant judges, clarify their professional development prospects and professional safeguard and open a channel for promotion in position and increase in salary, to improve professional level and stability of ancillary judicial personnel.

③　Perfect the education training and evaluation stimulation mechanism to intensify professional ethics and capability. Set up normalized long-term education training mechanism; make and carry out the plan for training an judicial elite team, open judges forum and create an open professional platform to encourage judges to dig into the trial business, optimize their knowledge structure and improve their comprehensive quality. Formulate the Measures for Evaluating Judges and implement the judges’ performance evaluation system to establish a much more sound evaluation index system. Intensify ideological and political education and rule-of-law belief education to further enhance the sense of professional honor, recognition and responsibility. Pursuant to the Guidelines for Judges’ Behaviors, strengthen guidance and constraint of judges’ ordinary and professional behaviors; Formulate the overall plan for the cultural construction of Qianhai Court, focus on the joint development of professional safeguard and judicial professional ethics education and build a high-quality judicial team with the rule-of-law ideal and international vision which is satisfactory to the trial of foreign-related and Hong Kong, Macao, Taiwan-related cases.