HOT TOPIC

RULE OF LAW


» Context

International markets require the rule of law to establish legal frameworks for trade and social stability, and for enforcement over the long term. However, is there a risk of assuming everyone knows the same definition for rule of law?

» In the News [please contact us for further archival references]
06Feb08

Chinese Companies Nearly Immune to US Lawsuits - AP J.Gold (Newark), E. Kurtenbach (Shanghai):
“Individuals and companies often find it impossible to win damages or other legal redress, especially for lawsuits filed overseas. Current obstacles arise because the targets of lawsuits are often companies that are partly owned by the Chinese government or army, or are allied with provincial governors [G Hufbauer, Peterson Institute, DC].
Chinese companies with no assets in the United States have no trouble ignoring a U.S. court order. "There is no treaty between the United States and China that requires the enforcement of each other's judgments," [M. Lyle, Weil, Gotshal & Manges, DC]. China is a signatory to an international accord known as the Hague Convention, but does not accept all of the treaty's articles. The expansion of Chinese companies into global markets, with offices and operations in the U.S. and elsewhere, could give them greater an incentive to cooperate in legal proceedings, Lyle said.

Note, however, that on the other hand corporate ethics experts at one business school were amazed at Chinese executives willingness to accept responsibility for the conduct of those below them – to serve the greater interest of avoiding endless recriminations and getting on with correcting the problem(s).

 

» Briefing Notes - © The Governance Counsel™ (2007)

[Governance Literacy: see rule of law.]