The China International Economic and Trade Arbitration Commission (CIETAC) has announced that it has suspended its authorisation for the Shanghai and South China sub-commissions for accepting and administering arbitration cases.
On 1 May 2012, at the time when the new CIETAC Arbitration Rules 2012 (2012 Rules) came into force, the CIETAC Shanghai sub-commission announced a split from CIETAC, with plans to become an independent institution. CIETAC responded at the time with a Statement declaring the Shanghai sub-commission's conduct to be a violation of the Arbitration Law of China, the relevant regulations of the State Council and CIETAC's Articles of Association (see Legal update, CIETAC and Shanghai sub-commission reported to have parted). Since that time, the Shanghai and South China sub-commissions have refused to apply the 2012 Rules and have refused to remain under the leadership of CIETAC in respect of case administration. Therefore, from 1 August 2012, parties who have agreed to arbitrate their disputes with the Shanghai or South China Sub-Commissions are requested to submit their applications for arbitration to CIETAC.
We will provide a fuller analysis of this development soon.