VII. China and the UN Ad Hoc Committee on Jurisdictional Immunities of States and Their Property
In accordance with the resolution of the 56thSession or the General Assembly in 2001, the Ad Hoc Committee on Jurisdictional Immunities of States and Their Property of the United Nations met in the United Nations Headquarters inNew YorkonFebruary 4-13, 2002.The meeting carried out in-depth discussions on five questions on which major differences existed in the discussions of the United Nations for several times in the past, including: the concept of a State, the criteria for determining the commercial character of a transaction or contract, the relationship between a State and a State enterprise, the contract of employment and the measures of constraint against state property.The Chinese Delegation participated in the deliberations of the Ad Hoc Committee on all the topics.
With regard to the criteria for determining the commercial character of a transaction or contract, the Chinese Delegation stated that the Chinese Government agreed in principle to the view-point of the International Law Commission expressed in the second reading of the draft on this topic to regard the present criteria as a supplementary criteria.The Chinese Government was of the view that in determining whether a contract or a transaction is a "commercial transaction", it was not enough to use only the criteria on character, the purpose of the State in carrying on the transaction should also be taken into consideration.
With regard to the relationship between a State and a State enterprise, the Chinese Delegation maintained that in principle a State enterprise or any other entity set up by a State should not enjoy State immunities, so long as the State enterprise or the other entity has independent act and the capacity to sue or be sue and has the capacity to acquire, possess or own or dispose property, including the property they operate and manage authorized by the State.At the same time, the Chinese Government maintained that it was necessary to differentiate clearly a State and a State enterprise or any other entity set up by a State and that a State enterprise or any other entity set up by a State should independently bear civil liabilities and a State, in principle, should not bear joint and several liabilities for commercial acts and liabilities or debts of a state enterprise or any other entity.
With regard to state immunities free from compulsory measures, the Chinese Government was of the opinion that once the Court enforces compulsory measures on the property of a defendant state, it must strictly satisfy the following requirements: (1) The property is in the territory of the country where the Court is located; (2) It is specifically used for the purpose that may be intended for uses other than the non-commercial uses of the government.(3) It is related to the demand of the object of proceeding or the institutions or departments of the sued.Among them, the third requirement is particularly important.The debt of a state can only be cleared off with the property which is demanded by the object of the proceeding and used by the institution of the sued for the purpose other than non-commercial purpose, and cannot be cleared of with the property of a state enterprises or any other entity.If the property for compulsory measure to be compulsorily enforced is not strictly defined, there will exist the possibility of misuse of compulsory measure by the court against the state property of the defendant state or the property of a state enterprise or entity not related to the litigation.