A new specialist financial court in China could enhance a ‘gravitational pull’ away from London, lawyers have said, though its immediate threat to the City has been downplayed.
The Shanghai Financial Court, which specialises in finance disputes, opened on Monday.
However UK lawyers told the Gazette that it should be welcomed rather than treated with caution as its focus, at least initially, will be domestic.
Peter Dodge, barrister at Radcliffe Chambers, said although challenges to the primacy of London as a litigation centre are topical, the court does not yet fall into that category. The court, he said, is designed to merge various special financial tribunals in the current Shanghai court system. ‘As such, it looks essentially to be a domestic court.’
‘That is not to say that it might not evolve into a body which increasingly seeks to apply English law in disputes with an international flavour,’ he added.
Charles Pugh, partner at regional firm Oury Clark, said the new centre should not be seen as a threat because ‘it is always positive’ when specialised courts open but warned against complacency. He added that London’s standing has been built over time based on the ’stellar reputation’ of the judiciary here, the recognition of English law and the use of the English language.
Khawar Qureshi QC, of Serle Court, said: ‘The emergence of rapidly expanding regional centres such as Singapore coupled with the increasing desire of parties to “go local” wherever possible means that London must avoid complacency and be more competitive to retain its position.’ He noted that Germany and France had also recently established English language based commercial courts to position themselves to draw disputes to them - at the potential cost of London.
Charles Qin, head of the dispute resolution practice at Chinese firm Llinks Law Offices, said the court has a vision to handle ever-increasing financial cases and ’voice China’s judicial influence on the international stage’. ’The Court hears a wide variety of finance-related disputes and aims at providing a first class venue for financial dispute resolution,’ Qin added.
According to news website ChinaDaily, the Shanghai court will handle disputes of a minimum value of RMB 100m (£11.4m) provided both parties are based in Shanghai and RMB 50m if one party is not based in the city. Cases that do not meet the minimum will be handled by district courts.