Teresa Huang and Di Wu[1]
As economic and trade cooperation between the mainland China and the Taiwan region has increased, so has the probability of civil and commercial disputes. Litigation remains one of the main options available to parties. If a party in a litigation judgment rendered by a court in the Taiwan region is unsuccessful and resides in the mainland China or owns property which may be enforced in the mainland China, the rights holder may need to apply to a mainland court for recognition and enforcement of the relevant Taiwan judgment in order to carry out the court’s judgment and safeguard the legitimate rights and interests of the rights holder.
As of May 2020, no mutual judicial assistance agreement had been signed between the both sides of the Strait on the mutual recognition and enforcement of the civil and commercial judgements rendered on each side, but both sides had unilaterally made relevant provisions to actively promote the recognition and enforcement of judgements. In July 1992, the Supreme People’s Court issued the Opinions of the Supreme People’s Court on Certain Issues Concerning the Application of the Civil Procedure Law of the People’s Republic of China, stipulating that judgements of Taiwan courts could not be recognized by the mainland courts, and that the parties concerned must file a new complaint with a competent people’s court to obtain a judgment for enforcement. In 1999, the Supreme People’s Court issued the Provisions of the Supreme People’s Court on the People’s Court’s Recognition of Civil Judgments Rendered by Courts in the Taiwan Region, providing that parties to civil judgments rendered by the relevant courts in the Taiwan region may apply to the people’s court as applicants for recognizing and enforcing civil judgments of the relevant courts in the Taiwan region in accordance with the such provisions. In June 2015, the Supreme People’s Court promulgated the Provisions of the Supreme People’s Court on the Recognition and Enforcement of Civil Judgments Rendered by Courts in the Taiwan Region (hereinafter, the “Provisions”). The Provisions stipulate that any effective civil judgement, ruling, settlement record, mediation record or payment order issued by a court in the Taiwan region may be submitted for recognition and enforcement by an intermediate people’s court or a specialized people’s court at the place of the applicant’s residence or regular residence or the place of residence or regular residence of the respondent or the place of the respondent’s property. Pursuant to the relevant legal provisions of the Supreme People’s Court on the mainland, the application for recognizing and enforcing civil judgments rendered by courts in the Taiwan region on the mainland can be generally summarized in the following key points:
1. The legal instruments of Taiwan courts eligible for recognition and enforcement include the following categories:
Pursuant to Article 2 of the Provisions, the civil judgments of the courts in the Taiwan region within the meaning of the Provisions include effective civil judgments, rulings, settlement records, mediation records, payment orders, etc., issued by the courts in the Taiwan region. In addition, the Provisions shall also apply to any application for recognizing a judgment, ruling or settlement record in a criminal case concerning civil damages as rendered by a court in the Taiwan region. If an application is filed to recognize a mediation instrument which is issued by a township or city mediation committee in the Taiwan region and approved by a court in the Taiwan region and which has the same effect as an effective civil judgment rendered by a court in the Taiwan region, the Provisions shall apply by reference. This shows that the adjudication instruments issued by Taiwan courts which can be recognized and enforced by mainland courts are not limited to court decisions or awards but also include civil judgments, rulings, settlement records, mediation records, payment orders and the aforementioned adjudication instruments with payment elements.
2. The adjudication instrument submitted by the applicant must be a final judgement that is true and complete.
First of all, the adjudication instrument provided by the applicant must be complete without any omissions, deficiencies, alterations, etc.; otherwise, the court will dismiss the application on the grounds that the full content of the adjudication instrument cannot be confirmed. Secondly, the above-mentioned adjudication instrument must have entered into force, which means that the adjudication instrument has become effective with certainty in accordance with the legal requirements of the Taiwan region. If the adjudication instrument is not in force or can possibly be changed under the Taiwan law (i.e., similar to the retrial procedure which a mainland case has entered), the decision cannot be considered “final.” As a result, there is a risk that it will not be recognized by a mainland court and will probably end up being unenforceable.
In practical cases, if the applicant can produce a complete original of the decision rendered by a court in the Taiwan region, notarized by the notary public in the Taiwan region and certified by the notary association of the place of application as being consistent with its copy, the court will usually affirm the authenticity of the adjudication instrument issued in the Taiwan region.
3. Application for enforcement shall not be made separately, and it is necessary to first apply for the recognition of the adjudication instrument issued by the Taiwan court.
Article 3 of the Provisions stipulates that if an applicant simultaneously applies for the recognition and enforcement of a civil judgment rendered by a court in the Taiwan region, the people’s court shall first examine the application in accordance with the recognition procedure. After a ruling on the recognition is rendered, the enforcement agency of the people’s court shall enforce the adjudication instrument. If the applicant directly applies for enforcement, the people’s court shall inform the applicant to also submit an application for recognition; and if the applicant insists on not applying for recognition, the court will render a ruling to reject the application.
When applying to a mainland court for enforcing an adjudication instrument issued by a court in the Taiwan region, it is necessary to first apply for the recognition of the adjudication instrument issued by the Taiwan court and then proceed with the enforcement procedure after the mainland court has recognized the contents of the decision. An applicant applying for the recognition of a civil judgement rendered by a court in the Taiwan region shall submit an application, which shall state the name, gender, age, occupation, identity card number, address (if the applicant or respondent is a legal person or another organization, the name, address, name and position of the legal representative or other responsible persons of the legal person or the organization) and means of communication of the applicant and respondent, the claims and reasons for the claims and the enforcement status of the judgement for which recognition is sought. In addition, it is necessary to attach the original or certified copy of a civil judgment and of a certificate of final civil judgment issued by the relevant court in the Taiwan region. If the civil judgment rendered by a court in the Taiwan region is a default judgement, the applicant shall also submit documents evidencing that the parties concerned have been lawfully summoned by the court in the Taiwan region.
4. Statute of limitations for recognition and enforcement application
In accordance with Article 20 of the Provisions, the provisions of Article 239 of the Civil Procedure Law shall apply to the statute of limitations for an application to recognize and enforce a civil judgment rendered by a court in the Taiwan region, except for an application to recognize a judgment rendered by a court in the Taiwan region concerning identity relationship. Pursuant to Article 239 of the Civil Procedure Law, the statute of limitations for an enforcement application is two years, and the provisions of the law on the suspension or interruption of the statute of limitations are applicable to the statute of limitations for an enforcement application. As previously indicated, an applicant shall apply to the competent mainland court for recognition and enforcement within two years after the court judgment is effectively rendered in the Taiwan region. Once the statutory period for the application is exceeded, the application is very likely to be rejected by the court, thus losing the possibility of requiring the other party to perform the effective judgment.
5. Competent court
In accordance with Article 4 of the Provisions, applications to recognize civil judgments rendered by courts in the Taiwan region shall be accepted by the intermediate people’s court or specialized people’s court at the place of residence or regular residence of the applicant or the place of residence or regular residence of the respondent or the place of the respondent’s property. If the applicant applies to over two competent people’s courts for recognition, the people’s court with which the application is filed first shall have jurisdiction. If an applicant applies to the people’s court at the place of the respondent’s property for recognition, the applicant shall provide relevant evidence for the existence of the property. The jurisdictional provisions for applying to the mainland courts for the recognition of judgements rendered by the Taiwan court are basically the same as the provisions on the competent court for civil litigation in the mainland in that the court at the place of the residence or regular residence of the respondent and at the place of the respondent’s property shall have jurisdiction. The difference is in the level of the competent court as an intermediate people’s court or a specialized people’s court. If an application for recognition is filed with more than two competent people’s courts, the people’s court with which the application is filed first will take jurisdiction. This prevents courts reluctant to take jurisdiction from passing the buck.
6. Reasons for denial of recognition
Under Article 15 of the Provisions and according to the findings in practice, the reasons why civil judgments rendered by courts in the Taiwan region are not recognized for can be divided into the following categories:
(1) A civil judgement is rendered when the respondent is absent without a lawful summons or when the respondent has no capacity to act in the lawsuit and no proper representation.
(2) The case falls within the exclusive jurisdiction of the people’s court.
(3) The parties to the case have a valid arbitration agreement and there is no waiver of arbitration jurisdiction.
(4) The case has been decided by a people’s court or by an arbitral tribunal in mainland China.
(5) A court or arbitral tribunal in Hong Kong, the Macao Special Administrative Region or a foreign country has rendered a judgment or arbitral award on the same dispute which has been recognized or accepted by the people’s court.
(6) Recognizing the judgment will violate the basic principles of national law such as the One China Principle or harm the public interest of society.
(7) The adjudication instrument submitted by the applicant is incomplete.
(8) The statute of limitations for recognition application is exceeded.
(9) The identity information of the applicant or respondent does not correspond to the identity information listed in the adjudication instrument.
Therefore, when an applicant applies to a mainland court for the recognition and enforcement of an adjudication instrument issued by a Taiwan court, issues such as defects in the adjudication instrument or in the identity information of the applicant or respondent should be avoided, and the final judgment should have no procedural and substantive legal violation in order to avoid any unenforceability.
In summary, the mutual recognition and enforcement of civil and commercial judgements between the mainland China and the Taiwan region have legislative guarantee and are supported by a large number of practical cases, making it entirely feasible to enforce Taiwan judgements on the mainland. If a party to a lawsuit in Taiwan anticipates that enforcement may take place on the mainland at a later stage, a lawyer should be consulted to design a reasonable litigation plan to minimize the legal risk of future enforcement on the mainland as much as possible.
[1] The authors are lawyers at Shanghai Lee, Tsai & Partners. However, the contents of this article merely reflect personal opinions and do not represent the position of this law firm.