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Maritime Law and Practice in China

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CHAPTER 19

Maritime jurisdictions

Introduction

19.1 Under Chinese law, jurisdiction in civil litigation means the division of work and power among courts at different levels and courts at the same level to entertain cases at first instance. The main legislation governing maritime jurisdiction include the Civil Procedure Law of the People’s Republic of China (the “CPL”) and the Special Maritime Procedure Law of the People’s Republic of China (the “SMPL”) supplemented by other interpretations, practice directions and guidances issued by the Supreme People’s Court of People’s Republic of China (the “SPC”). 19.2 As to the hierarchical jurisdiction, as referred to in of this book, Chinese courts are divided into four levels, namely the primary people’s court, the intermediate people’s court, the high people’s court and the SPC.1 The primary people’s court and intermediate people’s court generally entertain cases at first instance. Whether the first instance case will be tried by primary people’s court or intermediate people’s court will depend on the sum and nature of the disputes. Due to the special features of maritime disputes, first instance maritime cases are usually tried by the maritime courts. 19.3 Maritime jurisdiction is largely prescribed by law and the interpretations or directions promulgated the SPC. Chapter II of the SMPL provides for the rules relating to maritime jurisdiction. 19.4 In addition, the maritime courts can also entertain cases by an order of a superior court. Jurisdiction may be transferred from a local people’s court to a maritime court or be transferred from one maritime court to another maritime court under such order. Article 10 of the SMPL provides that where controversy arises between a maritime court and a local people’s court over jurisdiction, the matter shall be resolved by the two courts through consultation. If the consultation fails, the matter should then be submitted to their common superior people’s court for a designation of jurisdiction. 19.5 Parties to a dispute are also allowed to privately reach an agreement on the jurisdiction issue either before or after the dispute arises. 19.6 There are certain circumstances where several maritime courts all have maritime jurisdiction to a dispute. For example, section 3 of article 6 of SMPL provides that an action arising from a charterparty dispute of a seagoing vessel shall be under the jurisdiction of the maritime court of the place where the port of delivery, the port of redelivery, the ship’s port of registry and the domicile of the defendant is located. For such disputes, various claimants to the same dispute may refer the case to different maritime courts. Under such circumstances,

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the court that has already accepted the case should not transfer the case to another court that shares the same jurisdiction over the matter. If a maritime court that has accepted the case finds that another court that also has jurisdiction has also accepted the case earlier, the court should transfer the case to the maritime court that has already accepted the case.2 19.7 The maritime courts may also entertain cases by “extended jurisdiction”. After a maritime court has accepted a case for preservation of maritime claim before litigation, or in maritime evidence preservation or maritime injunction cases, this maritime court may change the original preservation case or injunction case into a litigation case upon the parties’ application, and thus the jurisdiction of the original maritime court will extend to the litigation cases. It should be noted that in order to establish such extended jurisdiction, the dispute in question may not be one which is subject to any exclusive jurisdiction, agreed jurisdiction or arbitration.

Jurisdiction of maritime courts

19.8 As discussed in the previous chapter, there are currently ten maritime courts in China, which have been gradually established since 1984 with the development of the shipping industry in China. Due to the complexity of maritime disputes and the special rules found under maritime law, the general people’s courts are not able to deal with maritime disputes. The maritime courts were thus established for especially hearing maritime disputes. Maritime courts are treated as a special people’s court, which is similar to other special courts such as military courts. The level of maritime court is the equivalent of an intermediate people’s court. 19.9 The court system of PRC is shown diagrammatically below:

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 19.10 In 1984, six maritime courts were first established. Their jurisdiction was set out in the Decisions of Supreme People’s Court on Several Issues of Establishing Maritime Court. These have since been changed by the subsequent decisions of the Supreme People’s Court, promulgated in 1989, 2001 and 2016 respectively. 19.11 The current case acceptance scope of the maritime courts is laid down in the Provision of the Supreme People’s Court on the Case Acceptance Scope of Maritime Courts (the “Case Acceptance Scope Provision”),3 which was promulgated on 24 February 2016 and came into effect on 1 March 2016. 19.12 The Case Acceptance Scope Provision divides maritime disputes tried by the maritime court into six groups, namely:
  • I. Cases concerning maritime tortious disputes
    • 1. cases concerning disputes over liability for damage arising from collisions of vessels, including cases concerning disputes over liability for damage caused by indirect collisions, including damage by waves;
    • 2. cases concerning disputes over liability for damage arising from collisions of vessels with facilities or other property at sea, in water areas leading to the sea, in ports, or on the shore, including cases concerning disputes over liability for damage caused by collisions of vessels with such facilities as wharfs, breakwater, landing stages, vessel locks, bridges, navigation marks, and drilling platforms;
    • 3. cases concerning disputes over liability for damage caused by vessels to facilities and other property that are set up in the air or laid at the bottom of the sea, or in the water areas leading to the sea;
    • 4. cases concerning disputes over liability for damage arising from oil, polluted water, or other harmful substances discharged, leaked, or dumped from vessels, causing pollution to water areas or damage to other vessels, goods, or other property;
    • 5. cases concerning disputes over liability for damage to fishing, breeding facilities, or aquatic-bred products arising from navigation or operation of vessels;
    • 6. cases concerning disputes over liability for damage arising from sunken vessels or articles as well as their wreckages and abandoned articles in the sea-lane, or temporary or permanent facilities or devices at sea or in water areas leading to the sea, affecting navigation of vessels and causing damage to vessels, goods, and other property;
    • 7. cases concerning disputes over liability for infringement upon other persons’ rights and interests arising from the navigation, service, and operation of vessels and other activities;
    • 8. cases concerning disputes over liability for illegal lien or impoundment of vessels, goods on board, and materials, fuel oil, or reserved parts of vessels;
    • 9. cases concerning disputes over liability for product quality arising from defects of key vessel parts and special items provided for marine projects; and
    • 10. other cases concerning maritime tortious disputes.

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    II. Cases concerning disputes over maritime contracts
    • 11. cases concerning disputes over vessel purchase and sales contracts;
    • 12. cases concerning disputes over vessel engineering project contracts;
    • 13. cases concerning disputes over such contractual disputes as the subcontracting and construction, commissioned building, customisation, and transaction of key vessel parts and special items;
    • 14. cases concerning disputes over vessel engineering project operation contracts (in forms of affiliation, partnership, and contracting);
    • 15. cases concerning disputes over vessel inspection contracts;
    • 16. cases concerning disputes over contracts on venue rental for marine projects;
    • 17. cases concerning disputes over contracts on operation and management of vessels (in forms of affiliation, partnership, and contracting) and contracts on cooperative operation of shipping lines;
    • 18. cases concerning disputes over contracts on supply of materials, fuel oil, and reserved parts relating to the operation of specific vessels;
    • 19. cases concerning disputes over shipping agency contracts;
    • 20. cases concerning disputes over vessel pilotage contracts;
    • 21. cases concerning disputes over contracts on mortgage of vessels;
    • 22. cases concerning disputes over charterparties (including time charterparties and bareboat charterparties);
    • 23. cases concerning disputes over contracts on financial lease of vessels;
    • 24. cases concerning disputes over payment of remunerations and compensation for casualties relating to seaman boarding, services on board, and repatriation upon disembarking under contracts on employment of seamen and service contracts (including agreements on labour dispatching of seamen);
    • 25. cases concerning disputes over contracts on carriage of goods at sea or in water areas leading to the sea, including cases concerning disputes over contracts of international multimodal transport containing shipping sections, and waterland transshipment, and other freight transport contracts;
    • 26. cases concerning disputes over contracts on carriage of passengers or luggage at sea or in water areas leading to the sea;
    • 27. cases concerning disputes over contracts on freight forwarding at sea or in water areas leading to the sea;
    • 28. cases concerning disputes over contracts on rental of transport containers at sea or in water areas leading to the sea;
    • 29. cases concerning disputes over contracts on transport tally at sea or in water areas leading to the sea;
    • 30. cases concerning disputes over contracts on towage at sea or in the water areas leading to the sea;
    • 31. cases concerning disputes over ferry transport contracts;
    • 32. cases concerning disputes over contracts on storage, custody, and warehousing of goods in ports;
    • 33. cases concerning disputes over guarantee contracts on mortgage or pledge of goods in ports;
    • 34. cases concerning disputes over contracts on supervision over pledge of goods in ports;

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      35. cases concerning disputes over contracts on warehousing, storage, and custody of marine containers;
    • 36. cases concerning disputes over guarantee contracts on mortgage or pledge of marine containers;
    • 37. cases concerning disputes over contracts on financial lease of marine containers;
    • 38. cases concerning disputes over contracts on lease of ports or wharfs;
    • 39. cases concerning disputes over contracts on operation and management of ports or wharfs;
    • 40. cases concerning disputes over contracts on marine insurance or protection and indemnity;
    • 41. cases concerning disputes over insurance contracts or protection and indemnity contracts with such subject matters of insurance as transport vessels in water areas leading to the sea and the operational income thereof, goods and the expected profits thereof, crew wages and other remunerations, and liabilities to third parties;
    • 42. cases concerning disputes over insurance contracts with such subject matters of insurance as equipment and facilities in marine projects and expected proceeds, and liabilities to third parties;
    • 43. cases concerning disputes over insurance contracts with such subject matters of insurance as equipment and facilities for production and operation in ports and expected benefit, and liabilities to third parties;
    • 44. cases concerning disputes over insurance contracts with subject matters of insurance including equipment and facilities utilised in such activities as marine fishery, ocean development and utilisation, and marine project construction and expected benefit, and liabilities to third parties;
    • 45. cases concerning disputes over insurance contracts with subject matters of insurance including equipment and facilities utilised in project construction in sea waters leading to the sea and expected benefit, and liabilities to third parties;
    • 46. cases concerning disputes over contracts on financial lease of port and shipping equipment and facilities;
    • 47. cases concerning disputes over guarantee contracts on mortgage or pledge of port and shipping equipment and facilities;
    • 48. cases concerning disputes over loan contracts with vessels, marine containers, and port and shipping equipment and facilities set as guarantee, excluding cases where the parties file lawsuits only for disputes over loan contracts;
    • 49. cases concerning disputes over loan contracts incurred by purchase, building, and operation of specific vessels;
    • 50. cases concerning disputes over guarantee, independent letter of guarantee, and letter of credit incurred by securing and satisfying of creditor’s rights relating to marine transport, vessel purchase and sales, marine project and port production and operation;
    • 51. cases concerning disputes over brokerage or commission contracts relevant to contracts or behaviour as prescribed in the preceding items 11 to 50; and
    • 52. other cases concerning disputes over maritime contracts.

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    III. Cases relating to disputes over development and utilisation of oceans and water areas leading to the sea and environmental protection
    • 53. cases concerning disputes over exploration, development, and transport of resources of oceans and water areas leading to the sea, and mineral resources;
    • 54. cases concerning disputes over desalination and comprehensive utilisation of sea water;
    • 55. cases concerning disputes over project construction at sea or in water areas leading to the sea (including underwater dredging, land reclamation from the sea, laying of cables or pipelines as well as construction of wharfs, docks, drilling platforms, man-made islands, tunnels, and bridges);
    • 56. cases concerning disputes relating to development and utilisation of coastal zones;
    • 57. cases concerning disputes relating to scientific investigation of oceans;
    • 58. cases concerning disputes over contracts on fishery operation in seas or water areas leading to the sea (including fishing and aquaculture);
    • 59. cases concerning disputes over contracts on financial lease of equipment and facilities for ocean development and utilisation;
    • 60. cases concerning disputes over guarantee contracts on mortgage or pledge of equipment and facilities for ocean development and utilisation;
    • 61. cases concerning disputes over loan contracts with equipment and facilities for ocean development and utilisation set as guarantee, excluding cases where the party files a lawsuit only for disputes over loan contracts;
    • 62. cases concerning disputes over guarantee, independent letter of guarantee, and letter of credit incurred by securing and satisfying of creditor’s rights relating to such maritime production and operation activities as project construction in the sea and water areas leading to the sea and ocean development and utilisation;
    • 63. cases concerning disputes over right to use sea areas (including disputes over contracts of contracting, transfer, and mortgage and corresponding infringement disputes), excluding cases concerning disputes over right confirmation arising from application for using sea waters;
    • 64. cases concerning disputes over brokerage or commission contracts relevant to contracts or behaviour as prescribed in the preceding items 53 to 63;
    • 65. cases concerning disputes over liability for pollution of marine environment and damage to marine ecology;
    • 66. cases concerning disputes over liability for the environmental pollution of water areas leading to the sea and damage to the ecology of water areas leading to the sea; and
    • 67 cases concerning disputes over other tort liability arising from development and utilisation of oceans and water areas leading to the sea, project construction as well as disputes of adjacent relations.
  • IV. Other cases concerning disputes over maritime affairs
    • 68. cases concerning disputes over property rights of vessels, including ownership of vessel, maritime lien, possessory lien of vessels, and maritime mortgage;

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      69. cases concerning disputes over property rights of goods in ports, marine containers, and port and shipping equipment and facilities, including ownership, lien, and mortgage;
    • 70. cases concerning disputes over property rights of equipment and facilities for development and utilisation of oceans and water areas leading to the sea, including ownership, lien, and mortgage;
    • 71. cases concerning disputes arising from transfer of bills of lading or pledge;
    • 72. cases concerning disputes over marine salvage;
    • 73. cases concerning disputes over salvage and wreck removal at sea or in the water areas leading to the sea;
    • 74. cases concerning disputes over general average;
    • 75. cases concerning disputes over port operations;
    • 76. Cases concerning disputes over negotiorum gestio of property at sea or in water areas leading to the sea;
    • 77. cases concerning disputes over shipping frauds; and
    • 78. cases concerning disputes relating to shipping agency and transaction of shipping derivatives.
  • V. Maritime administrative cases
    • 79. Administrative cases filed due to failure to accept maritime administrative organs’ administrative actions involving vessels, goods, equipment and facilities, marine containers, and other property at sea or in water areas leading to the sea and ports;
    • 80. administrative cases filed due to failure to accept maritime administrative organs’ administrative actions involving transport operations at sea or in water areas leading to the sea and such qualification and legal matters as corresponding auxiliary operations, freight forwarding, seafarer competency, and boarding services;
    • 81. administrative cases filed due to failure to accept maritime administrative organs’ administrative actions involving such activities as development and utilisation of oceans and water areas leading to the sea, and protection of the fishery industry and environmental and ecological resources;
    • 82. administrative cases filed since the relevant maritime administrative organs refuse to perform administrative duties involved in the aforesaid items 79 to 81 or refuse to make a reply;
    • 83. cases concerning requesting the relevant administrative organs to assume state compensation liabilities on the ground that the relevant maritime administrative organs and the personnel thereof carry out administrative actions as prescribed in items 79 to 81 or their exercise of the corresponding administrative functions impairs the lawful rights and interests of the applicant;
    • 84. cases concerning requesting the relevant administrative organs to assume state compensation liabilities on the ground that the relevant maritime administrative organs and the personnel thereof carry out administrative actions as prescribed in items 79 to 81 or their exercise of the corresponding administrative functions affects the lawful rights and interests of the applicant; and

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      85. cases concerning application for enforcement according to the law since the relevant maritime administrative organs carry out administrative actions as prescribed in the aforesaid items 79 to 81.
  • VI. Cases concerning special maritime procedures
    • 86. cases concerning application for determining the effectiveness of maritime arbitration agreements;
    • 87. cases concerning application for recognising and enforcing foreign maritime arbitration awards, application for recognising and enforcing maritime arbitral awards of Hong Kong Special Administrative Region, Macao Special Administrative Region, and Taiwan Region, and application for enforcing or setting aside domestic maritime arbitral awards;
    • 88. cases concerning application for recognising and enforcing maritime judicial adjudicative documents issued by foreign courts and application for recognising and enforcing maritime judicial adjudicative documents issued by courts of Hong Kong Special Administrative Region, Macao Special Administrative Region, and Taiwan Region;
    • 89. cases concerning application for determining property at sea or in water areas leading to the sea as ownerless;
    • 90. cases concerning application for negotiorum gestio of property at sea or in water areas leading to the sea;
    • 91. cases concerning application for declaring disappearance or death due to activities or accidents at sea or in water areas leading to the sea;
    • 92. cases concerning application for arresting vessels, goods on board, marine stores, or marine fuel oil or application for preserving other property with respect to maritime disputes before instituting legal proceedings;
    • 93. cases concerning disputes over liabilities arising from wrongful application for property preservation or excessive amount of guaranty by maritime claimants;
    • 94. cases concerning application for maritime injunction;
    • 95. cases concerning application for preservation of maritime evidence;
    • 96. cases concerning disputes over liabilities arising from wrongful application for maritime injunction or preservation of maritime evidence;
    • 97. cases concerning application for maritime payment order with respect to maritime disputes;
    • 98. cases concerning application for publicising public notice with respect to maritime disputes;
    • 99. cases concerning application for establishing liability limitation funds for maritime claims (including liability limitation funds for oil pollution damage compensation);
    • 100. cases concerning registration and indemnification of creditor’s rights relating to auction of vessels or establishment of liability limitation funds for maritime claims (including liability limitation funds for oil pollution damage compensation);
    • 101. cases concerning litigation for confirmation of rights relating to auction of vessels or establishment of liability limitation funds for maritime claims (including liability limitation funds for oil pollution damage compensation);

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      102. cases concerning application for subrogation against the liability limitation funds for oil pollution damage compensation;
    • 103. cases concerning public notice on maritime lien;
    • 104. cases concerning application for judicial confirmation of mediation agreements with respect to maritime disputes;
    • 105. cases concerning application for realising security interest with collaterals of such property as vessels, goods on board, marine stores, containers, port and shipping equipment and facilities, and equipment and facilities for ocean development and utilisation.
    • 106. cases concerning local people’s courts’ authorisation of arrest and auction of vessels for enforcing effective legal documents;
    • 107. cases concerning application for enforcement of effective legal documents issued by maritime courts and their appellate high people’s courts and the Supreme People’s Court with respect to maritime disputes; and
    • 108. cases concerning application for enforcement of notarial obligatory right documents with respect to maritime disputes.
19.13 If the cases fall within the case acceptance scope of the maritime courts, the parties in disputes are not allowed to agree to submit such disputes to a local people’s court by a jurisdiction agreement. 19.14 In Yingkou New Port Ore Terminal Co., Limited v China Railway Materials Co., Limited,4 the issue of jurisdiction of a maritime court was considered by the SPC. The disputes in this case concerned a coal storage agreement according to which the coal was stored at the port area. The agreement provided that any disputes were to be submitted to the court of the place where the domicile of the claimant was located. The defendant contended that this jurisdiction agreement was void and the local court should not have jurisdiction, since the disputes fell within the jurisdiction of the relevant maritime court in accordance with the Case Acceptance Scope Provision. This case was finally decided by the SPC, which held that this case was to be tried by the relevant Maritime Court since disputes arising from cargo storage in the port area fell within the case acceptance scope of the maritime court. The parties were not allowed to exclude such jurisdiction by agreement.

Maritime territorial jurisdiction

19.15 As mentioned above, China currently has in total ten maritime courts, namely Dalian Maritime Court, Tianjin Maritime Court, Qingdao Maritime Court, Wuhan Maritime Court, Shanghai Maritime Court, Ningbo Maritime Court, Xiamen Maritime Court, Guangzhou Maritime Court, Beihai Maritime Court, and Haikou Maritime Court. They are distributed across ten important watersheds. In particular, Wuhan Maritime Court is the only court that is established over the Yangtze River. Each of the maritime courts divide themselves up according to their first instance territorial jurisdiction, and the locations that they are in. 19.16 By the Provisions of the Supreme People’s Court on the Jurisdiction over Maritime Lawsuits (the “Provisions of Jurisdiction over Maritime Lawsuits”), which is a newly

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published judicial interpretation of the SPC in 2016,5 the territorial jurisdiction of Wuhan Maritime Court and Dalian Maritime Court has been changed. Currently, the territorial jurisdiction of the ten maritime courts is:
  • a. Dalian Maritime Court: the southern boundary extends to the junction of Liaoning Province and Hebei Province, and the eastern boundary extends to the extended sea waters of the mouth of the Yalu River and the waters of the Yalu River, including a part of the Yellow Sea, a part of the Bohai Sea and the onshore islands; the Songhua River, the Tumen River and other sea-connecting navigable waters and ports in Jilin Province; and, the Amur River, the Songhua River, the Ussuri River and other sea-connecting navigable waters and ports in Heilongjiang Province;
  • b. Tianjin Maritime Court: its territorial jurisdiction ranges south from Heibei Province to the juncture at Shandong Province, North from Hebei Province to the extended seawaters at Liaoning Province. It includes parts of the Yellow Sea, part of the Bohai Sea, the islands on the sea, and major ports such as Tianjin, Qinhuangdao etc.;
  • c. Qingdao Maritime Court: its territorial jurisdiction ranges south from Shandong Province to the juncture at Jiangsu Province, north from Shandong Province to the extended sea area juncture at Hebei Province. It includes parts of the Yellow Sea, part of the Bohai Sea, the islands on the sea and major ports such as Shijiusuo, Qingdao, Weihai, and Yantai;
  • d. Wuhan Maritime Court: its territorial jurisdiction includes waters in the Yangtze River trunk lines and feeder lines between the Hejiangmen port of Yibin City in Sichuan Province and the mouth of Liuhe in Jiangsu Province, including Yibin, Luzhou, Chongqing, Fuling, Wanzhou, Yichang, Jingzhou, Chenglingji, Wuhan, Jiujiang, Anqing, Wuhu, Ma’anshan, Nanjing, Yangzhou, Zhenjiang, Jiangyin, Zhangjiagang, Nantong and other major ports;
  • e. Shanghai Maritime Court: its territorial jurisdiction ranges south from Shanghai City and the juncture at Zhejiang Province, north to Jiangsu Province and the extended sea areas at the juncture of Shandong Province, the sea areas from Yangtze estuary to the sea areas in Liuhekou. It includes major ports such as Shanghai Port, Yangshan Port, Lianyun Port, Yangkou Port, etc;
  • f. Ningbo Maritime Court: its territorial jurisdiction includes the ports and sea areas in Zhejiang Province; it includes the islands and the inland waters that are connected to the sea in Zhejiang Province;
  • g. Xiamen Maritime Court: its territorial jurisdiction is south from Fujian Province to the juncture at Guangdong Province, north to Fujian Province and Zhejiang’s extended sea areas. It includes the southern part of the East China Sea, Taiwan Province, its islands, and the ports of Shandong Province;
  • h. Guangzhou Maritime Court: its territorial jurisdiction includes the ports and sea areas belonging to Guangdong Province, the inland waters, which includes its sea ports;

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    i. Haikou Maritime Court: its territorial jurisdiction includes the ports and seawaters of Hainan Province; and Paracel (Xisha) Islands, Zhongsha Islands, Spratly (Nansha) Islands, Huangyan Islands and sea areas;
  • j. Beihai Maritime Court: its territorial jurisdiction includes the Guangxi Province Zhuang Autonomous Region ports and seawaters, Beibu Gulf sea areas, its islands and sea waters, and the navigable waters that are connected to the seas from Lancang River in Yunnan Province to the Mekong River.
19.17 According to article 21 of the CPL, the territorial jurisdiction is mainly determined according to the domicile of the parties, especially the domicile of the defendant, and the proximity with the maritime court. This general rule is applied together with the special territorial jurisdiction such as those set out in article 6 of SMPL and the relevant provisions in of CPL. 19.18 The special territorial jurisdiction of maritime cases includes the following:
  • (1) Tort actions

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