CIETAC has its central office in Beijing and has four sub-commissions in Shanghai, Shenzhen, Tianjin and Chongqing. All branches are allowed to accept and administer arbitration cases.

Differences arose between the CIETAC Beijing and its Shanghai and South China branches, over the introduction of its 2012 Arbitration Rules (2012 Rules), which came into effect on 1 May 2012 (see Legal update, CIETAC releases new arbitration rules). In particular, a new provision in the Rules, which provides for the Beijing central office as the default administrator of cases unless the parties expressly refer to a sub-commission (replacing the old mechanism which allocated cases based on party convenience), attracted strong resistance from the Shanghai and Shenzhen sub-commissions, which are generally the two most popular branches after Beijing. They refused to follow the 2012 Rules and declared themselves independent arbitral institutions with separate arbitration rules (see Legal update, CIETAC and Shanghai sub-commission reported to have parted).

Following the promulgation of the new rules, various attempts were made to try to resolve these differences. Despite these efforts, on 1 August 2012, CIETAC announced that it had suspended its authorisation of the Shanghai and Shenzhen sub-commissions to accept and administer arbitration cases.

The announcement further confirmed that, if parties have already submitted their cases to the two sub-commissions, they would be administered by the Beijing headquarters but would be heard in Shanghai and Shenzhen.

In response, the two sub-commissions issued a joint statement on 4 August 2012, stating that CIETAC's announcement has no binding effect on them. The joint statement states that both CIETAC Shanghai and CIETAC South China (Shenzhen International Arbitration Court) continue to invite applications for arbitration.

The latest development is unfortunate and introduces some degree of uncertainty over CIETAC clauses, especially where they expressly refer to the Shanghai or Shenzhen sub-commissions. It remains to be seen how some of these issues will be resolved over time. However, for new clauses, parties who are agreeing to CIETAC arbitration and who wish to avoid these difficulties are advised to specifically agree to arbitration before CIETAC Beijing.