All businesses that work either in China or with Chinese companies know about the China International Economic and Trade Arbitration Commission (CIETAC). It is a major arbitration institution with the goal to “independently and impartially resolve business disputes.” To effectively do business in the Chinese sphere of influence, your company must understand CIETAC.
The history of CIETAC
The creation of CIETAC came in 1956, as Chinese economic leaders recognized the need for an impartial way to resolve disputes with overseas businesses. For China, the prospect of international economic growth is a centerpiece of their wider global policy. While there are stark differences between the economies of China and the US, increasingly, their needs are intermingled.
Originally, CIETAC was known as the Foreign Trade Arbitration Commission and played a vital role in opening the Chinese economy to the wider world. Today many consider CIETAC a necessity in the global marketplace.
The function of CIETAC
CIETAC functions as a permanent arbitration group and constantly updates its arbitration standards according to international practices. Its judgments are enforceable in 159 countries including the United States. This means that business disputes that cross international borders, while still complicated, cannot be avoided by moving to another country.
It is a heavily used arbitration organization and can help you reach relief in several ways if you are in dispute with your Chinese business partners. However, you must always understand that going through arbitration is never a simple or straightforward process.
Getting the most out of your arbitration
Experience with CIETAC arbitration is vital when you need help pursuing results for a business dispute.