Sun, Dec 19, 2010 - Page 1 News List

Cross-strait arbitration will depend on China’s legal system, expert says

By Shih Hsiu-chuan  /  Staff Reporter

Whether China is able to establish a fair and well-functioning legal system is an important factor influencing the development of cross-strait relations in the future, Jerome Cohen, a leading US expert on the Chinese legal system, said in Taipei yesterday.

The forum was hosted by the Taiwan Association for Human Rights and focused on China’s human rights situation.

“You know, I have always been supportive of both sides of the Strait working out compromises … but I feel that [China’s] legal system could be a key issue,” Cohen said in Mandarin at the forum as he responded to a question on what Taiwan can do to urge China to address its human rights issues.

As an example, Cohen used disagreements over an arbitration mechanism for investment and personal safety guarantees for Taiwanese businesspeople based in China, an issue that has been touched on in cross-strait negotiations.

If an agreement on such matters is to be signed, the first thing to do is eliminate legal obstacles as there is a great discrepancy between arbitration and the court systems in Taiwan and China, Cohen said.

“I often participate in the arbitration process [in China], sometimes I am an arbitrator, a lawyer or an appraiser, and I know that [China’s] arbitration can’t be trusted,” Cohen said.

Cohen, however, said he believed that Taiwan and China, which have not yet agreed to have business disputes handled by an independent institution, can eventually find a solution.

“It’s just one example. Looking into the future, I would be pessimistic about prospects for cross-strait peace unless China could reform its political and judicial system,” Cohen said.

Taiwan has recently confirmed that an agreement on the subject will not be signed during upcoming cross-strait talks, slated to take place in Taipei this week, as both sides need more time to explore other arbitration options, given they’ve ruled out using the WTO and the International Center for Settlement of Investment Disputes under the World Bank as arbitrators.

Cohen said the most difficult problems in business arbitration are “disputes between an investor and governments.”

“One very important question is how to protect your -businesspeople. If you and I are having a dispute and you don’t like my attitude, you can call in local police, put me in jail, and then you say ‘now let’s continue the negotiations.’ It’s unfair,” Cohen said, referring to the situation encountered by foreign investors in China.

Cohen said demanding China improve its mechanisms to protect foreign investors could prompt it to develop a better legal system.

“If I tell the Chinese that they should improve their legal system because it has to do with human rights, they don’t care. But if I tell them doing so will bring more investment from Taiwan and other countries, they will consider it important,” Cohen said.

In responding to other questions raised at the forum, Cohen said he welcomed the suggestion by Taiwanese activists and academics that Taiwan launch a dialogue with China on its human rights situation as it is an issue that should not be ignored.

Some in the audience called on Cohen to urge President Ma Ying-jeou (馬英九) to address human rights issues in China more often since he was Ma’s former professor at Harvard University. Cohen said jokingly that he is not an “insurance company” that can guarantee Ma will do whatever he says.

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