China and International Dispute Resolution in the Context of the “Belt and Road Initiative” Edited by Wenhua Shan, Sheng Zhang and Jinyuan Su CHINA AND INTERNATIONAL DISPUTE RESOLUTION IN THE ‘ CONTEXT OF THE BELT AND ROAD ’ INITIATIVE Written by eminent international judges, scholars and practitioners, this bookoffersatimelystudyofChina’sroleininternationaldisputeresolution inthecontextoftheconstructionofthe‘BeltandRoadInitiative’(BRI).Itis the first comprehensive assessment of China’s policy and practice in international dispute resolution, providing in-depth analysis of the law and practice in the fields of international trade, commerce, investment and international law of the sea, asthey relate to BRI dispute resolution. This book will beanindispensablereading forscholars andpractitioners with an interest in China and international dispute resolution. It also constitutes an invaluable reference for anyone interested in the changing international law and order, in which China is playing an increasingly significantrole,particularlythroughtheBRIconstruction. wenhua shan (PhD, Trinity College, Cambridge) is Ministry of Education Yangtze River Chair Professor of International Economic Law and the founding Dean of the School of Law at Xi’an Jiaotong University,PRChina.HeisalsothefoundingDirectoroftheSilkRoad InstituteforInteractionalandComparativeLaw(SRIICL).Hehastaught as Professor of International Law at Oxford Brookes University and UNSWSydney,andhasbeenaSeniorFellowoftheLauterpachtCentre forInternationalLawattheUniversityofCambridge,AssistantPresident, Xi’anJiaotongUniversity,andDeputyDirector-GeneraloftheJudicialCase AcademyattheSupremePeople’sCourt,PRChina.Hehaspublishedover adozenbooksininternationalandcomparativelawwithleadingEnglish andChinesepublishers,includingCUPandOUP,andnumerousarticlesin journalssuchastheEuropeanJournalofInternationalLawandAmerican Journal of Comparative Law. He is the founding Editor-in-Chief of The Chinese Journalof ComparativeLaw and founding General Editor of the “ChinaandInternationalEconomicLawSeries”and“SilkRoadStudiesin InternationalEconomicLaw”.AsConciliatoroftheInternationalCentrefor the Settlement of Investment Disputes (ICSID), Expert Member of the International Commercial Expert Committee of the Supreme People’s CourtofChina,ExecutivePresidentoftheChinaInternationalInvestment Arbitration Forum (CIIAF) and Arbitrator of the China International Economic and Trade Arbitration Commission (CIETAC) among others, ShanhaspractisedinternationalandChineselawssince1992. shengzhangisAssociateProfessoratXi’anJiaotongUniversitySchool of Law. He is Deputy Secretary-General of the China International Investment Arbitration Forum and an editor of The Chinese Journal of ComparativeLaw.Hemainlyfocusesoninternationalinvestmentlawand comparativelaw.HewasavisitingscholarattheLauterpachtCentrefor International Law and the Max-Planck Institute for Comparative and International Private Law. He has published articles in the European JournalofInternationalLaw,JournalofInternationalDisputeSettlement, TheChineseJournalofComparativeLawandColumbiaFDIPerspectives. jinyuan su is Professor of International Law at Xi’an Jiaotong UniversitySchoolofLaw.HewasanErinJ.C.ArsenaultFellow(2014–- 2015)attheMcGillInstituteofAirandSpaceLawandavisitingresearch fellow (2009–2010) at the Lauterpacht Centre for International Law, University of Cambridge. Dr Su’s research interests lie in outer space law, the law of the sea and international aviation law. His articles are publishedininternationalpeer-reviewedjournalssuchasChineseJournal ofInternationalLaw,International&ComparativeLawQuarterly,Asian Journal of International Law, Ocean Development & International Law andTheInternationalJournalofMarineandCoastalLaw. C H I N A A N D I N T E R N A T I O N A L D I S P U T E R E S O L U T I O N I N T H E C O N T E X T O F T H E ‘ B E L T A N D R O A D ’ I N I T I A T I V E Edited by WENHUA SHAN Xi’anJiaotongUniversity SHENG ZHANG Xi’anJiaotongUniversity JINYUAN SU Xi’anJiaotongUniversity UniversityPrintingHouse,CambridgeCB28BS,UnitedKingdom OneLibertyPlaza,20thFloor,NewYork,NY10006,USA 477WilliamstownRoad,PortMelbourne,VIC3207,Australia 314–321,3rdFloor,Plot3,SplendorForum,JasolaDistrictCentre, NewDelhi–110025,India 79AnsonRoad,#06–04/06,Singapore079906 CambridgeUniversityPressispartoftheUniversityofCambridge. ItfurtherstheUniversity’smissionbydisseminatingknowledgeinthepursuitof education,learning,andresearchatthehighestinternationallevelsofexcellence. www.cambridge.org Informationonthistitle:www.cambridge.org/9781108473392 DOI:10.1017/9781108561976 ©CambridgeUniversityPress2020 Thispublicationisincopyright.Subjecttostatutoryexception andtotheprovisionsofrelevantcollectivelicensingagreements, noreproductionofanypartmaytakeplacewithoutthewritten permissionofCambridgeUniversityPress. Firstpublished2020 AcataloguerecordforthispublicationisavailablefromtheBritishLibrary. ISBN978-1-108-47339-2Hardback CambridgeUniversityPresshasnoresponsibilityforthepersistenceoraccuracyof URLsforexternalorthird-partyinternetwebsitesreferredtointhispublication anddoesnotguaranteethatanycontentonsuchwebsitesis,orwillremain, accurateorappropriate. CONTENTS ListofFigures pagevii ListofTables viii ListofContributors ix ListofAbbreviations xv Introduction 1 wenhua shan, jinyuan su and sheng zhang PART I China,BRIandInternationalDispute Resolution 9 1 ChinaandtheDevelopmentofanInternationalDispute ResolutionMechanismfortheBeltandRoad Construction 11 james crawford ac 2 OneBelt,OneRoad,OneClauseforDispute Resolution? 23 michael hwang, david holloway and lim si cheng PART II China,BRIandInternationalTradeDispute Resolution 49 3 TradeandInvestmentAdjudicationInvolving‘SilkRoad Projects’:LegalMethodologyChallenges 51 ernst-ulrich petersmann 4 WhyDon’tWeHaveaWITO?G20,TPPandWTO 78 guohua yang v vi contents PART III China,BRIandInvestmentDispute Resolution 97 5 ICSIDandtheEvolutionofISDS 99 meg kinnear 6 TacklingPoliticalRisksthroughTreatizationalongtheBelt andRoad:AMinilateralSolution 113 wei shen 7 MultilateralReformofInvestor–StateDisputeResolution Mechanism:ABalancebetweenPublicLegitimacy ManagementandPrivateEfficiencyRefinement 149 peng wang 8 EnergyDisputeResolutionalongtheBeltandRoad:Should ChinaAccedetotheEnergyCharterTreaty? 185 anatole boute PART IV China,BRIandResolutionofMaritime Disputes 207 9 TheBeltandRoadInitiativeandthePotentialforDispute SettlementundertheUNConventionontheLawof theSea 209 natalie klein 10 PeacefulResolutionofMaritimeDisputesandtheUN ConventionontheLawoftheSea 233 keyuan zou 11 UnsaidRulesofUNCLOS:EssentialElementsforIts ProperInterpretation? 251 bingbing jia 12 ChinaandInternationalDisputeSettlement:Implications oftheSouthChinaSeaArbitration 280 jiangyu wang Index 317 FIGURES 5.1 ICSIDcaseload–casesregistered–31December2018 page106 6.1 GrowthofChina’soutboundinvestment(1990–2017) 121 6.2 RuleofLawIndex(WJP) 124 6.3 RegulatoryQuality 124 6.4 DoingBusinessIndex 125 6.5 RespondentStates(Regions)inICSIDCasesby2017 125 vii TABLES 2.1 Hurdlesofenforcementinselectivecivillawcountriesinthe BRI page34 7.1 ProposalsforchangestotheISDSmechanism 162 7.2 ThestructureofMIDR 170 7.3 Selectedaspectsofreformproposals 172 10.1 ContractingpartiestotheLOSCineastAsiaandtheirmaritime claims 247 10.2 BilateralmaritimeagreementsineastAsia 248 viii