Companies look for more fairness as China eyes legal reforms at key meeting

Sat Oct 18, 2014 7:06pm EDT
 
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By Ben Blanchard and Sui-Lee Wee

BEIJING (Reuters) - China is set to unveil key legal reforms this week that will try to limit the influence local officials have on court cases, a move being closely watched by company executives who hope it will make the legal system more impartial.

The announcement is expected at the end of an Oct. 20-23 meeting of the ruling Communist Party elite, which has made the "rule of law" the theme of the gathering. The meeting, called a plenum, comes at a time when slowing economic growth in the world's second-largest economy is raising the prospect of more commercial disputes.

The business community, in particular Chinese private firms and foreign investors, have long complained about the difficulty of getting a fair hearing in court because judges usually answer to local governments and party organs, which often have their own interests to protect.

Chinese media has recently carried reports on local companies suing each other when a dispute arises, with the parties lodging separate cases in courts in their home provinces, which then inevitably find for the home firm.

In April, Knowles Corp (KN.N: Quote), a New York-listed maker of advanced micro-acoustic products, said its lawyers had been blocked by a provincial court from attending a patent infringement case involving Chinese group GoerTek.

Ahead of the plenum, a meeting of the roughly 370-member Central Committee that usually takes place annually, state media has noted that the key goals are to temper the influence of local governments in courts and to make judges more professional and not tools of the party.

This would involve "reforming the judicial system to prevent local officials from interfering in court decisions", a source with knowledge of the plenum agenda told Reuters on condition of anonymity.

However, while the party may be seeking to limit the influence of officials on courts, there is no suggestion China is about to set up an independent judiciary, and for sensitive cases, such as high-level corruption or for prominent dissidents, the party will remain firmly in charge.   Continued...

 
Chinese Vice President Xi Jinping delivers a speech during a joint media briefing with Romania's President Traian Basescu (unseen) at Cotroceni presidential palace in Bucharest in this October 19, 2009 file photo.  REUTERS/Bogdan Cristel/Files