Dec 15, 2023

Apostilles to Simplify Requirements for China Litigation

by Yi Dai and Dimitri Phillips

On 7 November 2023, the Convention Abolishing the Requirement of Legalization for Foreign Public Documents (a.k.a. “Apostille Convention”, dating from 1961) came into effect in China. As many businesses and individuals know, outside China, apostilles have long afforded relatively straightforward authentication of official documents from one country to be used in governmental procedures in another country. Now, China has adopted this authentication in place of the country’s hitherto unique and comparatively burdensome requirements.

Parties benefit from using apostilles in numerous contexts. For example, even establishing or making certain changes to a business entity, or carrying out certain types of commercial transactions, requires authenticated documents (e.g., certificates of incorporation for corporate parents, identity documents, and powers of attorney): such documents previously had to pass through China’s special “legalization” process, but some (if not all) now can instead just be apostilled – which takes less time, involves lower costs, and is more familiar to most parties. More information about such benefits and background to the Apostille Convention’s adoption in China can be read about in DaHui’s newsletter of 16 March 2023. Here below, this newsletter will focus on the benefits of apostilles to parties involved in PRC court proceedings.

Legalization for China Litigation

To file a lawsuit in China, or to make a formal appearance to respond, the litigant must generally submit several documents alongside its complaint or response: one or several identity-related document(s) and, if represented by counsel, a power of attorney. For an individual, a passport copy usually satisfies all the requirements for identification, while a corporate party generally needs to submit copies of a company registration document and one or several document(s) establishing the identity and authority of the company’s representative (e.g., a director or “legal representative”). For foreign litigants, PRC courts only accept authenticated copies of these documents.

For authentication, until 7 November 2023, PRC law and practice required the document to undergo a “certification” process by notaries and/or government organs in the country of the document’s origin, and then “legalization” by a Chinese embassy or consulate in the same country.[1] The legalization process took at least several days, often weeks, and occasionally months, and cost up to approx. USD 50 per document (or more if “rush” service was available); moreover, officials at the embassy or consulate often raised singular objections or requirements (e.g., objecting to mention of “Hong Kong” not followed by “PRC”, or requiring translations), sometimes even raising questions about the substantive content of documents, resulting in frustrations, delays, and in rare instances impossibility to authenticate documents.[2]

In short, the certification and legalization requirements and process for litigation in China have long meant that parties often had to wait weeks or months just to initiate (or respond to) their cases, suffer through bureaucratic nightmares, and on rare occasions even abandon or alter their plans. This framework could also interfere with later stages of litigation, since some other documents (including certain kinds of evidence) from abroad needed to satisfy the same requirements and process.

Apostilles for China Litigation

Starting from 7 November 2023, for documents from the 124 signatories to the Apostille Convention, apostilling replaces legalization for China. One benefit is a potential reduction in the number of steps to be carried out by parties to participate in PRC court proceedings (or in numerous other activities involving governmental procedures), since certain documents may be apostilled without some or all the certification steps prerequisite to the legalization process. Another, and probably more important, change is in the nature of a key step – and several benefits are expected to follow from that change.

The more-or-less standardized, internationally tried-and-tested process of apostilling a document is carried out by high-level authorities in the relevant document’s country of origin (e.g., U.S. Secretaries of State, UK Foreign & Commonwealth Office, and the Swiss Federal Chancellery or Cantonal authorities). The process generally takes a few days and costs as little as USD 15; moreover, it is rare for authorities to raise objections about a document’s substantive content or impose additional requirements – obtaining an apostille, at least in the U.S. and Europe, is generally a minor formality. Ultimately, authenticating documents via apostilles does not involve interfacing with any PRC authorities. In some circumstances, it may also be possible to undertake the apostille process once for multiple uses of the resulting apostilled documents.

Scope and Implementation of Apostilles in China

The big questions are: to what extent does the Apostille Convention apply to foreign documents to be used in China for litigation (and other government-related procedures) and how quickly and consistently will PRC courts (and other authorities) actually implement the new framework?

The Apostille Convention is meant to apply to so-called “public documents” – whose meaning is determined by the law of the country issuing the document – and expressly includes at least documents emanating from an authority or an official connected with the courts or tribunals of the country, administrative documents, and notarial acts. Typically, company registrations are administrative documents and thus directly fall within the scope of the Apostille Convention, while for documents that do not directly fall within that scope, once they are notarized, they may also be deemed “public documents” by at least some jurisdictions and thus benefit from the Apostille Convention. According to this view, all the documents needed for litigation (and most other government-related procedures) in China should be accepted by PRC courts (and other authorities) with apostilles in lieu of legalization, though a major determining factor for each document will be if the country from which it originates considers it (in itself or through notarization) a “public document”.

PRC embassies and consulates around the world have already announced not only the entry into force of the Apostille Convention but also the formal cessation of their legalization services. This is a strong indication of the quick and effective shift in the document authentication procedure, but it is not definitive. First, even the announcements from embassies and consulates include notes such as the following: “The completion of the U.S. apostille does not guarantee the acceptance of the public document by the relevant user in China.”[4] Second, some sources indicate that although the legalization services have officially ceased, if a recipient in China insists on legalization, the PRC embassies and consulates will accommodate the demand. Third and most importantly, in practice it is indeed up to individual PRC courts (and other government authorities) to accept or refuse documents based on whether they have been apostilled as opposed to legalized. DaHui has not encountered or even heard of such refusals so far, but cannot rule out their rare occurrence, at least in the first few months after November 2023.[5]

Takeaways

After over 60 years, China has finally acceded to and begun implementing the Apostille Convention. PRC embassies and consulates abroad have announced the end of the long-dreaded “legalization” process previously required for documents to be used in PRC court (and other government-related procedures). A foreign party seeking to initiate, or respond to, a lawsuit in China should be able to satisfy the bureaucratic documentation prerequisites through the long-established, relatively quick and economical, and generally unproblematic apostille process. Documents are apostilled (in some situations after local certification) in their country of origin and no PRC authorities are involved – until, of course, the documents are submitted to a PRC court (or other government organ).

While it cannot be expected that every individual PRC court clerk (or other official) will immediately and unfailingly understand and accept apostilles in lieu of legalization, at least not in the first few months of the Convention’s implementation, both Beijing and PRC embassies and consulates have relatively clearly signaled that foreign individuals and businesses should rarely (if ever) again have to suffer the frustration, delays, costs, or dead ends in dealing with PRC officials to authenticate company registrations, identity documents, etc. in order to participate in litigation (or other government-related activities) in China.


Footnotes

[1] Which steps for certification were required depended on the type of document and the hierarchy of authorities and their powers in the country of the document’s origin. For example, in the United States, certain documents issued by state or federal authorities could directly be certified by Secretaries of State or the Department of State, respectively, whereas most other documents (e.g., powers of attorney and affidavits) had to first be notarized and then certified by the relevant government authorities.

[2] For documents originating in the roughly dozen countries with which China has not established diplomatic relations (e.g., the Republic of Paraguay and the Vatican), an additional step may have been required: certification by a local embassy or consulate of a country with which China does have diplomatic relations.

[3] Embassy of the People’s Republic of China in the United States of America, Notice on the Abolition of Consular Authentication Services by The Chinese Embassy and Consulates-General in the U.S. After China's Accession to the 1961 Hague Convention, issued on 24 October 2023.

[4] One remaining issue is that PRC laws, regulations, etc. still contain the provisions explicitly or implicitly requiring legalization: although PRC law provides that rules from binding treaties take precedence over domestic law, there may be lower chances of PRC authorities refusing apostilled documents if and when the domestic rules are updated to reflect the new, Apostille Convention framework.

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