Part I: General Jurisdiction Rules-Standfirst

As the first part of a series, this article outlines the general jurisdiction rules governing foreign-related civil litigation in China under the Civil Procedure Law of the People’s  Republic of China (2024) and explains the statutory framework, key jurisdictional bases, and procedural considerations that foreign companies and in-house counsel need to understand when facing potential lawsuits in Chinese  courts.

Summary

● In 2024, significant amendments were made to China’s Civil Procedure Law (the “CPL”).

● As a result, foreign companies which engage with Chinese parties or activities in China face a significant risk of litigation in Chinese courts.

● Chinese courts typically assert jurisdiction if the defendant is domiciled in China or another statutory connecting factor exists.

● The amendments allow Chinese courts to assert jurisdiction in the absence of traditional connecting factors.  

● Such circumstances include the location of signing or performance of a contract, property ownership, or joinder of domestic parties.

● Dispute resolution clauses should be given careful attention.

● Should litigation arise, promptly engaging trustworthy local counsel is essential as timelines can be tight.

The 2024 amendments to the CPL (the “2024 CPL”) (民事诉讼法) have significantly expanded the bases on which Chinese courts may assert jurisdiction over foreign-related civil cases. As a result, foreign entities may now face litigation in China even without a physical presence there—especially if they contract with Chinese parties, operate local offices, or engage in activities online that affect Chinese interests.

For in-house counsel, understanding when and how jurisdiction may be assumed by Chinese courts is critical.

I. Doctrinal Framework of Jurisdiction in Chinese Civil Litigation

This section outlines the fundamental structure of jurisdiction in Chinese civil litigation. Unlike the U.S. legal system, which relies on doctrines such as “personal jurisdiction” and “subject matter jurisdiction” grounded in constitutional due process and judicial interpretation, China’s jurisdictional system is defined almost entirely by statute. Jurisdiction is based on clearly enumerated legal criteria such as the location of contractual performance, the occurrence of tortious conduct, or the presence of assets in China. The Chinese system primarily follows a defendant-oriented model, but also incorporates exclusive and special jurisdiction rules based on the nature of the dispute.

A. No Personal Jurisdiction Doctrine: Jurisdiction Must Be Grounded  in Statute

Chinese courts do not recognize a general doctrine of “personal jurisdiction”, as the U.S. model does, which requires that a defendant have sufficient “minimum contacts” with the forum to satisfy due process. Under U.S. precedent (for example, International Shoe Co. v. Washington), courts consider fairness and foreseeability in determining whether a forum may assert jurisdiction over an out-of-state defendant.

In contrast, Chinese courts derive their jurisdiction solely from statutory grounds set out in the CPL and binding judicial interpretations. Courts assess whether the dispute  falls within established  bases, such as where a contract was signed or performed, a tort occurred, or  the property in dispute is located. Concepts such as fairness or convenience are not independently determinative.

This formalistic approach means that if any of the statutory jurisdictional grounds under Articles 276–277 of the 2024 CPL are met—or if the Chinese court finds an “appropriate connection” under the newly added Article 276(2)—jurisdiction will generally be assumed. Foreign parties cannot challenge jurisdiction based solely on the lack of a personal nexus to China or general notions of unfairness. Notably, China also achieves a function similar to subject-matter jurisdiction through its rules on exclusive jurisdiction, which authorize competent courts to hear certain types of disputes.

B. Default Rule: Jurisdiction Based on Defendant’s Domicile or Statutory Connection Points

Under Article 276 (1) of the 2024 CPL, the default rule is that a case must be brought in the court where the defendant is domiciled or has a registered office in China. This primary jurisdictional basis holds true even for cross-border suits.

In a case where the defendant has  no domicile in China, the  Chinese court will establish jurisdiction based on  one or more of the  six “connection points” :

1.Place where the contract was formed;

2.Place where the contract is to be performed;

3.Location of the subject matter   (goods/services);

4.Location of seizable property in China;

5.Place where tort occurred or where its  consequences were felt in China; and/or

6.Location of the defendant’s representative office or branch in China.

Only if at least one of these applies—or the case has “other appropriate connection(s)” under Article 276(2)—may a court assume jurisdiction over a foreign defendant. This is a major update in the 2024 CPL is Article 276(2), which allows courts to assert jurisdiction over foreign-related disputes if the case has other appropriate connections with China in the absence of the six established bases. 

Recent case law in high-profile patent and contract disputes (such as Conversant v. ZTE and Oppo v. Sharp) demonstrates that courts interpret “appropriate connections” broadly. Factors taken into consideration include the locations of contract negotiation, patent licensing, seizable assets, or accrual of tort damages—even if these events occurred abroad, they would be deemed appropriate connection, provided they have a direct impact on, or clear nexus with, China.

II. Grounds for Chinese Courts Taking Jurisdiction over Foreign Companies

In some circumstances, Chinese law extends jurisdiction to foreign companies, especially in tort disputes, contract claims, property-related disputes, and cases with other “appropriate connections” to China. The 2024 amendments to the CPL have broadened jurisdiction, allowing Chinese courts to assert jurisdiction even in complex, cross-border disputes where traditional connection points may not apply.

A. Statutory Bases for Asserting Jurisdiction Over Foreign Companies

Since the amendments to the CPL entered into force on January 1, 2024, Chinese courts have clarified and significantly broadened the circumstances under which they can assert jurisdiction over cases involving foreign entities—even when the defendant is located outside China.

1. Tort Disputes

A Chinese court may hear non-domestic tort claims if either the wrongful act or the harm occurred in China. Under this provision, Chinese courts’ jurisdiction would extend to online misconduct, such as copyright infringement, trademark violations, or data breaches, that affect Chinese entities or individuals, regardless of where the infringers are physically located.

2. Contract Disputes

Jurisdiction can now be based on several possible loci:

● Where the contract was signed;

● Where the contract was performed; or

●Where the subject matter (goods, services, intellectual property) is located in China. This ensures that contracts with substantial ties to China, such as delivery within China or execution by a Chinese counterparty, can be litigated in PRC courts.

3. Property-Related Claims

Any civil dispute involving real property located within China  (such involvement including ownership, leasing, or mortgages) is subject to the exclusive jurisdiction in the court where the property is situated.

4. “Other Appropriate Connections” (Catch-All Provision)

The 2024 CPL introduces a flexible catch-all provision that allows PRC courts to hear  cases with other appropriate connections to China, even in the cases where  none of the specified  grounds apply. Supreme People’s Court explanations of this newly added basis indicates it is intended to fill gaps—particularly when there is a meaningful causal or economic link to China, but none of the specified connection points applies, such as a Chinese subsidiary suffering damage overseas or a foreign deal with contractual negotiations conducted in China. This broadening of scope allows courts to exercise discretion to adapt to complex, evolving commercial realities.

Overall, the 2024 CPL shifts jurisdictional analysis from a narrow checklist approach to a broader, effects-based assessment—opening the door to a wider range of foreign-related litigation in Chinese courts.

B. Jurisdiction through Joinder with Domestic Parties

In multi-party litigation, Chinese courts may exercise jurisdiction over foreign defendants indirectly through joinder with domestic defendants. If one co-defendant meets jurisdictional requirements (for example, is domiciled in China or has its representative office there), courts frequently assert jurisdiction over all co-defendants joined in the case. Two scenarios arise: 

● Necessary Joinder: Where the parties must be joined to resolve the core claims, courts are especially likely to extend jurisdiction to foreign co-defendants, as all issues are interdependent.

● Non-Necessary Joinder: Where parties could theoretically litigate separately, courts may still assume jurisdiction, particularly if the foreign party is closely linked to a domestic entity (for example, via parent-subsidiary relationships). The extent of the link and the necessity of consolidating the case are key considerations in judicial decisions.

The mere fact that a defendant is foreign or located outside China does not guarantee immunity against a joinder decision by the court. If one joined defendant creates a valid jurisdictional hook, this may result in the entire case being tried in a Chinese court.

III. Exceptions That May Affect Jurisdiction

In some cases, Chinese courts have exclusive jurisdiction over certain disputes, including corporate structure disputes involving PRC entities and the validity of intellectual property rights issued in China. There  are also limits to forum selection agreements: in some cases, Chinese courts will respect such clauses while in other circumstances they may override them based on public interest concerns.

A. Exclusive Jurisdiction

Certain types of disputes must be litigated in Chinese courts,  no matter what the contract or agreement says. The 2024 CPL introduced two key categories under exclusive jurisdiction:

1. Corporate structure disputes involving PRC entities

This includes claims related to the establishment, dissolution, or liquidation of, or challenges to the internal resolutions of companies or organizations incorporated in China. These matters are considered deeply tied to China’s legal system and public governance and must be handled by Chinese courts.

2. Validity of intellectual property rights granted in China

Disputes concerning whether a Chinese-issued patent, trademark, or other IP right is valid cannot be adjudicated outside China, even if all parties are foreign.

Chinese courts have applied these rules strictly. For example, academic reviews show that in cases invoking Article 279 in 2024, courts consistently recognized these disputes as under exclusive jurisdiction,  even if another country’s court had been suggested by the parties.

If your contract involves these subject-matters, any jurisdiction clause selecting a foreign court may be deemed invalid. In such cases, arbitration is still possible, but only where permitted under PRC legal rules, and depending on whether arbitration is available for that subject matter under Chinese law.

B. Forum Selection Agreements and Their Limits

1. Agreements in Favor of Chinese Courts

Parties to foreign-related disputes may legitimately agree in writing to submit to PRC courts, even if the case has minimal or no direct connection to China. Chinese law explicitly permits such consensual choice-of-court provisions, reflecting respect for party autonomy and an effort to attract international disputes to be heard domestically.

2. Agreements in Favor of Foreign Courts (Exclusive Forum Clauses)

Chinese courts will respect valid exclusive jurisdiction clauses in favor of foreign courts, but only under these conditions:

● The dispute does not fall under PRC courts’ exclusive jurisdiction (as described above).

● The dispute does not involve China’s sovereignty, security, or public interest.

In these circumstances, the Chinese court may decline to accept the case or, if already accepted, dismiss it outright.

The Chinese practice reflects alignment with the 2005 Hague Convention on Choice of Court Agreements, which mandates respect for exclusive forum clauses—while tailoring them to China-specific public-interest exceptions.

3. Presumption of Exclusivity

Important casework and judicial guidance indicate that forum-selection clauses are presumed exclusive unless expressly stated otherwise. This means  that unless a contract explicitly notes that the approval of jurisdiction is non-exclusive, the courts treat it as binding and exclusive.

In recent years, Chinese courts have also shown willingness to recognize clearly worded asymmetric jurisdiction clauses, although their enforceability depends on clarity and fairness.

IV. Procedural Landscape and Litigation Practice in Chinese Civil Courts

1. Service of Process

The 2024 CPL, effective from January 1, 2024, significantly broadens how foreign companies can be served in Chinese litigation:

●Service may be made to wholly foreign‑owned enterprises (“WFOEs”), representative offices, or legal representatives located in China on behalf of foreign parent companies—even without specific authorization.

● Chinese‑based counsel are deemed authorized to accept service, even if the power of attorney contains disclaimers, as long as they represent the foreign party in the  respective case.

● Courts may use electronic methods, including email, WeChat, and instant messaging, and may accept service via postal delivery, diplomatic channels, and public announcement in the case where other methods fail. The public notice period has been shortened from 90 days to 60 days.

These changes streamline service and reduce dependence on lengthy Hague Convention procedures that can delay proceedings by months.

2. Litigation Style

Civil litigation in China remains judge-centered rather than adversarial. Chinese judges actively oversee fact‑finding and evidence gathering, scheduling interrogations, ordering witnesses to appear, and requesting documents. Parties may assist, but courts control most procedures. This contrasts sharply with U.S. litigation, where parties drive discovery and courtroom participation is adversarial with limited judicial intervention.

3. Timelines and Default Judgments

Once service is completed, foreign defendants typically have 30 days to submit a defense statement. Courts rarely grant extensions. Even failure to contest jurisdiction in time may lead to jurisdiction being assumed and potentially default judgment, if no response is filed. Foreign defendants must act swiftly or risk losing by default.

4. Evidence and Burden of Proof

Chinese courts adopt a burden-shifting model: the plaintiff must adduce initial evidence to frame its claims, but the court may then informally oversee disclosure and request evidence from defendant or third parties.

Moreover, courts often require localization of evidence—particularly contracts, invoices, receipts, and data—translating them into Chinese and sometimes requiring notarized originals or apostilled copies. Delayed or non-compliant delivery of evidence may lead the court to draw adverse inferences. China applies a two-tier trial system, where most civil cases are concluded after a second-instance ruling.

V. Key Takeaways for In-House Counsel

For anyone involved in cross-border matters with China—whether businesses or individuals—it is important to understand how civil disputes may be handled by Chinese courts. There are four essential points to keep in mind:

1. Chinese courts may claim jurisdiction in more  situations than expected

If a dispute has any connection to China (such as a contract being signed or performed in China, harm occurring in China, or property located in China), Chinese courts may assert jurisdiction. The law now allows courts to act even when the connection is indirect but considered “appropriate.”

2. Pay close attention to dispute resolution clauses

Jurisdiction and governing law terms in contracts should be clear, specific, and mutually agreed upon. Vague, missing, or one-sided clauses can create uncertainty and risk being drawn into litigation  in China. Standard agreements provided by counterparties should be reviewed carefully.

3. Timing and formalities matter

Once a case is filed, deadlines come quickly. Foreign parties often have only 30 days to respond. Courts expect timely filings, complete documentation, and accurate translations. Delays or technical errors may lead to unfavorable outcomes or even default judgments.

4. Prepare early, not after a dispute arises

Good preparation makes a big difference. Key records should be preserved in proper form, with translations ready if needed. It is advisable to engage local legal expertise when entering into agreements involving China. Additionally, having a proactive response plan in place helps avoid undue alarm and ensures more  effective handling if a dispute does occur.