Litigation & Arbitration

This system governs the nature, mission, organization, operational principles of lawyers, as well as how lawyers provide legal services.

  Nature, Mission and Status

  1. Nature

  Article 2 of the Lawyers Law of the People's Republic of China, promulgated on May 15, 1996, defines lawyers as "professionals who have obtained a practicing license through legal means to provide legal services." Lawyers are an important force for the construction of the legal system in China. Article 3 provides that practicing lawyers must abide by the Constitution and laws and adhere to the code of ethics and professional discipline for lawyers. They must use facts as basis and law as yardstick for practicing.

  2. Mission

  The mission of lawyers is to achieve the objective specified in state laws through the practice of law. Article 1 of the Lawyers Law states that the mission of lawyers is to maintain the lawful rights and interests of the parties to a suit and maintain proper implementation of law. These two objectives are mutually complementary because the maintenance of lawful rights and interests is consistent with the maintenance of the right implementation of law.

  3. Status of Lawyers

  Chinese lawyers play an independent role in lawsuits. They do not belong to courts or procuratorates, nor do they belong to their clients. They participate in lawsuits in order to maintain the legal rights and interests of their clients. They are independent. They enjoy not only rights of an ordinary participant in a lawsuit, but also rights compatible with the exercise of the duties of a lawyer.

  Qualifications for Licensing

  To practice, lawyers must first obtain professional qualifications and apply for a license after probation. After obtaining qualifications, they must receive the license for practicing in accordance with legal procedures in order to practice law as a lawyer. Only then can they enjoy the rights of lawyers while assuming duties accordingly.

  Individuals who have obtained legal qualifications may retain their qualifications and not engage in the legal profession for a period of time. This is known as separation of legal qualifications from legal practicing.

  1. Legal Qualifications

  Article 6 of the Lawyers Law provides that there are two ways for obtaining legal qualifications: through national examination or approval by judicial authorities.

  According to Article 6, "The state shall administer a national examination to determine lawyer qualification. Persons with a three-year college education in law and above or with equivalent qualifications, as well as persons with a bachelor's degree in other disciplines and above, can be awarded lawyer's qualifications by the State Council judicial administration after passing the national examination."

  Article 7 provides that persons with a four-year college education in law and above who have engaged in law studies and teaching and hold a senior professional title or with equivalent qualifications and who have applied for a practicing license may be granted lawyer's qualifications subject to approval by the State Council judicial authorities.

  2. Licensing

  a) Prerequisites for Applying for Practicing License

  Article 8 of the Lawyers Law states that applicants for a practicing license must support the Constitution of the People's Republic of China and meet the following requirements:

  Fully qualified;

  Full year of internship at a law firm;

  Be in good standing.

  b) Rejection of Applications

  Article 9 states that applicants who meet any of the following conditions will be denied a practicing license:

  Unable to perform civil acts or are restricted in performing civil acts;

  Have been criminally penalized (but not including crimes of negligence);

  Have been dismissed from public offices or had their practicing license revoked.

  c) Procedures for Applications

  Applicants must first submit, through their current or future law firm, all the required application documents to the local judicial authorities. According to Article 10 of the Lawyers Law, these documents should include the following:

  Letter of application;

  Certificate of Lawyer Qualification;

  Internship Performance Evaluation by the law firm where the applicant has worked;

  Copies of the applicant's identification documents.

  The local judicial authorities should form an opinion within 15 days of receipt of the application documents and report the matter to the provincial (autonomous regional/municipal) judicial authorities. The judicial authorities of the provinces, municipalities and autonomous regions should, after reviewing the documents submitted, grant a practicing license to applicants who meet the requirements as specified in the Lawyers Law within 30 days of receipt of the application. Those who fail to meet the requirements will be denied a practicing license and should be notified of the decision in a written form within 30 days of receipt of the application.

  d) Registration of License

  Lawyers should register their practicing license once a year; unregistered licenses are not valid. Registration is administered by judicial authorities above the Judicial Bureau at the provincial (municipal or autonomous regional) level. If necessary, registration can also be administered by judicial bureaus at the prefectural (city or county) level with authorization from higher judicial authorities.

  3.Licensing Restrictions

  Article 12 of the Lawyers Law provides that lawyers should practice at one law firm rather than at two or more simultaneously. No geographical restrictions should be imposed.

  Article 13 states that incumbent government office holders should not concurrently be lawyers. While serving on the Standing Committee of the People's Congress at various levels, lawyers should not practice.

  Article 14 provides that unlicensed persons should not practice as lawyers or represent or defend clients for a profit.

  Persons engaging in legal teaching and research should not be partners in a partnership or a cooperative law firm.

  Law Firms

  Article 15 of the Lawyers Law provides, "A law firm is the practicing institution of lawyers" and the basic unit for regulation of the legal profession. Practicing lawyers are dispatched by their law firms and they practice in the name of the law firms.

  1. Nature of Law Firms

  The Lawyers Law provides for three forms of law firms: state-funded, cooperative and partnership. Different operational mechanisms are permitted for different forms of law firms and they assume different legal obligations (civil liabilities).

  Article 16 states that state-funded law firms should practice law and assume liabilities with all their assets.

  Article 17 says that lawyers may form cooperative law firms and assume liabilities with all their assets.

  Article 18 says that lawyers may form partnership law firms and partners assume unlimited and joint liabilities for their firm.

  2. Establishment of a Law Firm

  a) Article 15 provides that law firms should meet the following requirements:

  Have their own name, residence and articles of association;

  Have more than 100,000 RMB of assets;

  Have lawyers who meet requirements of this Law.

  b) Approval Procedures

  Article 19 states that applications for establishment of a law firm should be reviewed and verified by judicial authorities at the provincial (autonomous regional/municipal) level or above and a license should be issued to applicants who meet the requirements of this Law within 30 days of receipt of application; those who fail to meet the requirements should be denied a practicing license and be informed of the decision within 30 days of receipt of application.

  c) Establishment of Branch Offices

  Article 20 provides that law firms may set up branch offices subject to review and approval by local judicial authorities of the province (autonomous region/municipality) where the branch office is to be set up. The parent law firm should assume liabilities for their branch offices.

  d) Alteration and Termination of Law Firms

  Article 21 states that law firms should report any alteration of name, location, articles of association and partnership or dissolution to the original approval authorities.

  3. Internal Management

  Article 23 states that lawyers should undertake business through their law firm, which should sign a written contract with their clients, charge them fees in compliance with state regulations, and record the fees faithfully into books.

  Article 24 states that law firms and lawyers should not engage in acts of unfair competition such as defaming other lawyers or paying commissions on referrals.

  4. Transformation of Law Firms

  Law firms are undergoing reforms aimed at severing any links with government departments. According to a State Council notice [Guofaban 2000 No. 51] on the separation of intermediary organizations engaged in economic certification from government departments and a Ministry of Justice notice on the separation of law firms and legal counseling institutions from government offices, the following types of law firms should sever their links with the government:

  State-funded law firms that have already achieved a balance of payments;

  Law firms affiliated with non-profit institutions, enterprises or social organizations;

  Legal counseling service providers established with approval of judicial authorities and affiliated with government offices, non-profit institutions, enterprises or social organizations.

  After severing ties with government offices, these law firms should be transformed into partnership or cooperative law firms no longer affiliated with administrative or institutional entities. They will no longer enjoy privileges associated with ranking government offices. State-funded law firms that have not yet realized a balance of payments and which are still dependent upon state subsidies will not participate in the separation program.

  This program was completed before October 31, 2000.

  The definition and disposal of state assets were based on the principle of “whoever invests owns the property.” While ensuring the integrity of state assets, the policy takes into account assets formed by legal professionals with their intellectual work.

  Business, Rights and Duties of Practicing Lawyers

  1. Business

  Article 25 of the Lawyers Law provides that lawyers may engage in the following businesses:

  Be legal counsels at the request of citizens, legal entities and other organizations;

  Represent clients and participate in lawsuits at the request of parties to civil and administrative cases;

  Provide legal counseling at the request of criminal suspects and file complaints, lawsuits or applications for obtaining a guarantor while awaiting trial on behalf of clients; act as defense attorney at the request of the suspect, the accused or the court; act as the advocate and participate in lawsuits at the request of private prosecutors, victims or their next-of-kin relatives in public-prosecution cases;

  File complaints on behalf of clients;

  Participate in mediation and arbitration at the request of clients;

  Provide legal services at the request of clients who are not parties to a lawsuit; and

  Provide legal counseling, draft lawsuit documents and other legal documents.

  2. Rights and Obligations of Lawyers

  According to the Lawyers Law, the Criminal Procedure Law, the Civil Procedure Law, the Administrative Procedure Law and other regulatory interpretations, lawyers enjoy the following rights and assume the following obligations.

  a) Rights

  Investigation. Article 31 of Lawyers Law provides that when handling legal cases, lawyers, subject to permission by relevant entities or individuals, investigate them for fact-finding purposes.

  Access to documents and files. The Criminal Procedure Law provides that the defense attorney may, from the day the procuratorate reviews a lawsuit, access, transcribe or copy judicial documents and technical appraisement documents of the case; they may also, from the day the court handles the case, access, transcribe or copy factual documents used in the case. Article 30 of the Lawyers Law provides that lawyers participating in lawsuits may, in compliance with procedural law, access documents related to the case.

  Meet and communicate with persons with limited personal freedoms.

  Appear in court and participate in lawsuits.

  Refuse to defend and represent any client.

  Lawyers' corporal rights are inviolable.

  b) Obligations

  Abide by the Constitution and laws and observe codes of ethics and professional discipline;

  Defend and represent clients unless circumstances require otherwise;

  Provide legal aid;

  Maintain confidentiality. Article 33 of the Lawyers Law states that lawyers should maintain state secrets and commercial secrets known to them in the practice of law and they should not reveal the privacy of their clients;

  Refrain from accepting special cases. Article 34 of the Lawyers Law states that lawyers should represent both parties to a dispute at the same time. Article 36 provides that lawyers who have served as judges and prosecutors should not represent or defend clients within two years of retirement from the court or procuratorate;

  Refrain from representing clients in private;

  Refrain from profiting from parties to a dispute by taking advantage of the convenience of legal service or accept money or gifts from clients;

  Refrain from meeting judges and prosecutors in violation of rules;

  Refrain from giving gifts to or bribe judges, prosecutors, arbiters and other related personnel, or prompting or instigating their clients to bribe;

  Refrain from hampering testimony giving. Article 35 of the Lawyers Law provides that lawyers should not engage in perjury, hide facts or threaten or prompt others to commit perjury, hide facts or interfere in the legal collection of evidence by the other party;

  Refrain from disturbing the order of a court of law or an arbitration tribunal.

  Bar Associations

  1. Nature of Bar Associations

  Clause 1, Article 37 of the Lawyers Law states, "Bar associations are non-governmental organizations enjoying the status of legal entities. They are the self-disciplinary bodies of lawyers."

  Status of bar associations: Judicial authorities instruct and supervise bar associations.

  2. Setup of Bar Associations

  Clause 2, Article 37 states that a China National Bar Association will be established at the national level and local bar associations set up at provincial (autonomous regional/municipal) levels. Cities with different districts may set up local bar associations if necessary.

  3. Relations Between Bar Associations and Lawyers

  Clause 2, Article 39 provides that lawyers must join a local bar association. Lawyers who are members of a local bar association are also members of the national bar association. In accordance with the constitution of the bar association, members enjoy rights and perform duties accordingly.

  4. Responsibilities of Bar Associations

  Article 40 of the Lawyers Law states that bar associations should perform the following duties:

  Ensure legal practicing for lawyers and safeguard their lawful rights and interests;

  Summarize and exchange experiences among lawyers;

  Organize legal training programs;

  Publicize, inspect and supervise lawyers' code of ethics and professional discipline;

  Organize lawyers to undertake international exchanges;

  Arbitrate disputes arising from the practice of law;

  Other duties as specified in law.

  Bar associations should reward or penalize lawyers in accordance with their constitution or bylaws.

  Code of Ethics, Professional Discipline and Penalties for Lawyers

  1. Code of Ethics

  According to the Code of Ethics and Professional Discipline for Lawyers adopted on October 6, 1996 by the China National Bar Association, lawyers should:

  Always be client-oriented;

  Be faithful to their code of ethics, safeguard the legality of the state and social justice;

  Be honest and trustworthy, providing legal assistance to clients dutifully;

  Respect each other and compete fairly;

  Be clean and maintain self-discipline;

  Be loyal to the legal profession and maintain the reputation of lawyers.

  2. Professional Discipline

  The above-mentioned Code of 1996 imposes the following disciplines on lawyers:

  Disciplines at the workplace: lawyers should not charge fees exorbitantly;

  Disciplines during action and arbitration;

  Disciplines governing lawyers' relations with their clients and the defendant;

  Disciplines governing relations among lawyers themselves.

  3. Penalties for Lawyers

  The Ministry of Justice on October 22, 1992 published penalties for lawyers who breach their code of ethics and professional discipline.

  a) Main provisions on penalties:

  Warning;

  Suspension of business;

  Disqualification of lawyers.

  b) Enforcement body and procedures

  Judicial authorities above prefecture, city and county level should be the enforcement body. Legal disciplinary committees should be established within those judicial authorities to enforce penalties. Members of the committee should include practicing lawyers, lawyers' associations and judicial personnel.

  Procedures for enforcing penalties:

  Submission and review of proposal to mete out penalty;

  Appraisal of the penalty measure;

  Review;

  Enforcement of penalty.

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