Belt and Road growth means China’s lawyers need a deeper understanding of foreign markets
Graduates of Peking University attend a convocation ceremony in Beijing on July 4 last year. Chinese and international law schools are beginning to place more emphasis on the need for training in international law issues. (PHOTO / IMAGINECHINA)
As progress continues under the China-led Belt and Road Initiative, the demand for international legal talent in Asia is rising, prompting closer transnational cooperation in education among universities and legal institutions.
“The significant economic activities along the Belt and Road have already led to an increasing demand for legal services. Responding to resulting market needs, this will in turn boost legal education, in particular in the Asian region,” said Lutz-Christian Wolff, Wei Lun professor of law and dean of the graduate school at the Chinese University of Hong Kong (CUHK).
With 75 economic and trade cooperation zones established along the Belt and Road route, China’s trade with participating countries has reached 30 trillion yuan (US$4.4 trillion) and its investment in them has exceeded US$70 billion, Chinese State Councilor and Foreign Minister Wang Yi told the Forum on the Belt and Road Legal Cooperation in July. The investment has generated more than 200,000 jobs.
While advancing the “hard connectivity” of the Belt and Road infrastructure, Wang said the “soft connectivity” of BRI regulations and standards should also be enhanced, because the successful outcomes of the initiative are supported by rules and laws.
Ma Wei, director of China region and global director at Beijing-based law firm Dentons, said: “Companies need to face a number of risks while participating in the Belt and Road Initiative, and the legal risk is undoubtedly an unavoidable one.”
Ma is also managing director of Dentons’ Kunming office in Southwest China’s Yunnan province, and a guest researcher at the China-ASEAN (Association of Southeast Asian Nations) Law Research Center based in China’s Southwest University of Political Science and Law.
According to Ma, there is no getting around the importance of legal talent. “Because no matter which country you are investing in, you need to abide by local rules, and the most basic rule is law,” he said, adding that it is uncommon for Chinese legal professionals to have knowledge in both domestic and foreign law.
Legal education in China and elsewhere tends to focus on domestic law and some limited international law, but usually does not include foreign laws, said Gary F. Bell, director of the Asian Law Institute (ASLI). Based at the National University of Singapore’s (NUS) Faculty of Law, ASLI is a network of law schools in Asia and beyond.
Foreign law is the national law of an individual foreign country, while international law is the law of international organizations, such as the UN, and the laws between nations, such as those established by treaty.
“This may be fine for the majority of lawyers who will focus their career exclusively on domestic law, but the training is inadequate for lawyers who will be involved in transactions with foreign elements, which will require knowledge of foreign law,” said Bell. Such knowledge can cover international contracts, overseas investment, cross-border family law issues and cross-border successions, he added.
Wolff from CUHK agreed that special challenges for legal talent and education must be tackled in the BRI context, particularly due to participating countries’ legal systems being extremely diverse and at varying stages of development.
More than 80 countries and international organizations have signed Belt and Road cooperation agreements with China over the past five years.
“Lawyers, legislators and other professionals working in the Belt and Road context need to be aware of and address these differences, as they need to know how to bridge existing gaps,” said Wolff. “There is an urgent need for the legal education (system) to respond by training graduates who can succeed in this international arena.”
Over the past decade, Chinese and international law schools have started to acknowledge the need for training in international law issues, but Wolff said the focus is primarily still on public law topics. More focus should go on law governing cross-border business transactions conducted by private parties, he said, as this area is even more important in day-to-day legal practice.
Wolff noted that many cooperation projects between international parties and Chinese law schools have taken place in recent years, along with the general globalization trend and China’s increasing international importance.
“From a pedagogical point of view, all this (cooperation in legal education) should be most welcome as Chinese and non-Chinese students benefit significantly from international exchanges and other forms of law school cooperation,” said Wolff.
CUHK has set up exchange programs with law schools in Belt and Road countries, and allows students from participating countries to apply for scholarships. In the academic year 2018-19, CUHK Faculty of Law has admitted students from several BRI countries, including India, Turkey, Malaysia and South Korea.
Local governments across China are also rolling out Belt and Road scholarships to attract students from related countries. Take Beijing as an example. Xinhua reported the capital city will award scholarships to students from Belt and Road countries studying in 160 programs at universities by 2020. Thirty-two undergraduate and postgraduate programs are being chosen each year, since 2016, and the programs include subjects such as legal studies.
NUS also has various exchange programs that invite foreign teaching staff to teach foreign law and send students abroad. But Bell said this kind of cooperation beyond borders is not easy because of language barriers, and most law schools in Asia lack the resources to finance an extensive visitors’ program.
This month, the first batch of international students have started their first semester at Silk Road School at the Beijing-based Renmin University of China’s Suzhou campus in East China’s Jiangsu province. The school is the first educational institution built under the Belt and Road Initiative. Chinese law is among four majors offered in the two-year program, together with Chinese politics, Chinese economy and Chinese culture. All courses will be taught in English.
“With the increasing role of China in international trade and investment, law schools outside of China should try to teach the basics of Chinese law,” said Bell. He expects law schools to review their curriculum to ensure students are well-trained in the basics of both law systems.
For Chinese lawyers, Bell said it is a must to become more familiar with other countries’ laws. Though some BRI-related cross-border transactions may be governed by Chinese law, there will be an increasing number of transactions, usually involving a Chinese party, governed by non-Chinese law.
“China is privileged, as with ‘one country, two systems’ it has the benefit of having both a common law system (in the Hong Kong Special Administrative Region) and civil law system (in the Chinese mainland),” said Bell. “It should take advantage of this and make sure that more lawyers are trained in both legal traditions which will prepare them well for international transactions.”
China’s Peking University established its School of Transnational Law in 2008 in Shenzhen, South China’s Guangdong province. According to the bilingual law school’s website, it had over 400 graduates between 2012 and 2017, of which 8 percent went on to work in Hong Kong and overseas. Some students chose to study abroad and have been admitted by Yale, Harvard, Stanford, Oxford and other elite universities around the world.
As BRI-related investments will cover many fields, Bell said it is hard to say which sectors of law will be most in demand. But lawyers will require skills to cover areas like contract negotiations, dispute resolution, international arbitration, and foreign investment law.
Construction law and transportation law may also be highly relevant, as there will be many infrastructure projects, particularly in the field of transportation, said Bell.
Ma from Dentons said future legal professionals must be global thinkers with knowledge of innovation, openness, inclusiveness and the ability to think on a macro level. They also must know how to integrate various resources to help provide a customized trading framework and strategic planning for clients, who want to bring their investment outside China.
A deep understanding of the foreign market is also key.
The geographical location of Dentons’ Yunnan office borders three ASEAN countries: Laos, Vietnam and Myanmar. Besides partnering with local law firms, Dentons transfers Chinese lawyers to the Myanmar office for better integration with local employees.
Ma said he hopes to expand the partnership and let more of its Chinese lawyers be trained in the foreign market.
“There are many excellent lawyers in the ASEAN member states … and there is huge potential for China and ASEAN to further collaborate and communicate in the legal service industry, due to closer business ties,” said Ma.
In 2017, Chinese mergers and acquisitions in Asia hit a record high, while ASEAN showed great potential, according to international accounting firm Ernst & Young.
Though many challenges lie ahead in the future of legal education, Bell said he remains hopeful as “there is such dynamism in Asia that the future of legal education looks bright”.
Wolff said cross-jurisdictional exchanges will “enrich teaching environments significantly and will, through knowledge transfer, improve legal education systems everywhere.
“Most importantly, students will benefit tremendously by learning about foreign cultures and their (potentially differing) significance of the operation of law.”
HONG KONG NEWS