Chinese Courts Can Now Try Foreign States

Beijing has made the unprecedented decision to allow some cases against foreign states in Chinese courts, a move that will align its take on "foreign state immunity" with mainstream Western practices, as reported by the South China Morning Post.

The Foreign State Immunity Law, adopted by the Standing Committee of the National People's Congress, will remove the immunity of foreign states or governments from being sued by next year.

China has long taken the stance that states and their property are immune from the jurisdiction of the courts of other states.

Previously, it has never allowed a case where a foreign state or government was sued, nor has it allowed any claim involving a foreign state or their property. However, the Foreign State Immunity Law, adopted by the Standing Committee of the National People's Congress on Friday, will remove such immunity from next year.

Experts said the "long overdue" law could provide better legal protection for businesses involved in international trade.

From January 1, 2024, sovereign states or entities acting on their behalf that are involved in certain territorial infringements or commercial activities will no longer be immune from prosecution in China.

Commercial activity was defined in the draft law as "any transaction or investment involving goods or services or other act of a commercial nature that does not constitute an exercise of sovereign authority."

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