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Page 1: Understanding China - Springer978-3-642-40817-5/1.pdf · Understanding China. An CHEN The Voice from China An CHEN on International Economic Law ... r on e Contemporary v Di Bilateral

For further volumes:http://www.springer.com/series/11772

Understanding China

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An CHEN

The Voice from China

An CHEN on International Economic Law

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ISSN 2196-3134 ISSN 2196-3142 (electronic) ISBN 978-3-642-40816-8 ISBN 978-3-642-40817-5 (eBook) DOI 10.1007/978-3-642-40817-5 Springer Heidelberg New York Dordrecht London

Library of Congress Control Number: 2013958396

© Springer-Verlag Berlin Heidelberg 2013 This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifi cally the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfi lms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. Exempted from this legal reservation are brief excerpts in connection with reviews or scholarly analysis or material supplied specifi cally for the purpose of being entered and executed on a computer system, for exclusive use by the purchaser of the work. Duplication of this publication or parts thereof is permitted only under the provisions of the Copyright Law of the Publisher’s location, in its current version, and permission for use must always be obtained from Springer. Permissions for use may be obtained through RightsLink at the Copyright Clearance Center. Violations are liable to prosecution under the respective Copyright Law. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specifi c statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. While the advice and information in this book are believed to be true and accurate at the date of publication, neither the authors nor the editors nor the publisher can accept any legal responsibility for any errors or omissions that may be made. The publisher makes no warranty, express or implied, with respect to the material contained herein.

Printed on acid-free paper

Springer is part of Springer Science+Business Media (www.springer.com)

An CHEN National Eminent & Senior JuristProfessor of International Law Xiamen University Law School Xiamen, Fujian 361005, China

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Pref ace

This is a monograph entitled The Voice from China: An CHEN on International Economic Law . It actually collects and compiles 24 representative articles written in English by me during different stages of the past 30-odd years since the early 1980s.

As known to all, China holds one of the most ancient and glorious civilizations in the world and has contributed immensely to human civilization. Most Chinese people are very proud of this. However, since the notorious Opium War in 1840, China has suffered from aggression and suppression of the Western powers and Japan for more than a century, which is a humiliation to all Chinese people. When I was young, I was taught of the glorious civilization of China, but I was also educated by and personally experienced the sad national crisis of China. Such complex emotions gradually nurtured my strong sense of national pride and patriotism, my determination to fi ght against international hegemonism, and my ambition to strive for social justice and to support all other weak countries in the world.

Shortly after New China was established in 1949, since the late 1950s, China suffered from a fragile social and political situation for 20 years. During this period, the legal research and the legal academic community in China also withered. As a junior teacher in the university at that time, I had to shift my teaching fi eld from law to other disciplines, not to mention keeping my mind abreast with the progress of modern international law.

The resolution adopted by the Third Session of the 11th National Congress of the Chinese Communist Party in late 1978 is critical. This Congress corrected social chaos and restored social order and inaugurated the state policy of reform and opening up formulated by the late leader Xiaoping Deng. Without this policy, there would have been no revival of Chinese legal community. In the spring of 1981, Prof. Jerome A. Cohen from the United States visited Xiamen and expressed in one of his lectures his concern that China might arbitrarily confi scate foreign investment and property. Based on my knowledge of relevant Chinese laws and policies, I raised some opposing ideas against his and followed with my explanations. Then, with Prof. Cohen’s kind invitation, I went to Harvard Law School to study and lecture between 1981 and 1983. During that time, I read many authoritative

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books of international law and international economic law written by prominent US professors, such as Prof. Louis Henkin, Prof. Andreas F. Lowenfeld, and Prof. John H. Jackson, together with many other fi rsthand documents and records. This experience greatly broadened my insight and provided me with a great deal of fresh knowledge. In the meantime, however, I found that these books contained some opinions with a strong sense of colonialism and economic hegemonism refl ecting the US-style double standards rooted in unilateralism and utilitarianism. Such opinions not only went against the just advocate of reforming the old interna-tional economic order (OIEO) and establishing the new international economic order (NIEO), but also were against the historical tide of the modern world. I think these opinions are misleading and with major defi ciencies.

For this reason, we, Chinese law scholars, should not blindly follow and completely accept these Western opinions. Rather, a correct attitude is to contemplate indepen-dently and critically in order for us to be able to distinguish right from wrong. By holding such kind of attitude, in my later three decades of research and writing, I, together with my Chinese colleagues, have always been trying to analyze, distin-guish, ascertain, absorb, or reject Western legal theories while steadily taking into account the national situation of China and the common position of the weak coun-tries. In addition to “keeping the essence while discarding the dross” of the Western legal theories, we have raised a series of our own innovative ideas and actively participated in international academic debates, which have helped us to shape our systematic theories on various important legal subjects such as South–North Confl icts and Cooperation, reformation of the OIEO and establishment of the NIEO, as well as law-making, law-enforcing, law-abiding, and law-reforming of international economic law. Our theories are signifi cantly and substantially different and independent from some of the existing Western ones.

Personally, I tried to put forward my independent opinions in each of my papers, and here I would like to just list half of them, which the readers might wish to read through:

1. On the Marginality, Comprehensiveness and Independence of International Economic Law Discipline

2. On the Misunderstandings Relating to China’s Current Developments of International Economic Law Discipline

3. On the Source, Essence of “Yellow Peril” Doctrine and Its Latest Hegemony “Variant”—the “China Threat” Doctrine: From the Perspective of Historical Mainstream of Sino-Foreign Economic Interactions and Their Inherent Juris-prudential Principles

4. To Close Again, or to Open Wider: The Sino-U.S. Economic Interdependence and the Legal Environment for Foreign Investment in China after Tiananmen

5. The Three Big Rounds of U.S. Unilateralism versus WTO Multilateralism during the Last Decade: A Combined Analysis of the Great 1994 Sovereignty Debate, Section 301 Disputes (1998–2000) and Section 201 Disputes (2002–2003)

Preface

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6. On the Implications for Developing Countries of “The Great 1994 Sovereignty Debate” and the E.C.-U.S. Economic Sovereignty Disputes

7. A Refl ection on the South–South Coalition in the Last Half-Century from the Perspective of International Economic Law-Making: From Bandung, Doha and Cancún to Hong Kong

8. Should the Four “Great Safeguards” in Sino-Foreign BITs Be Hastily Dismantled?—Comments on Critical Provisions concerning Dispute Settlement in Model U.S. and Canadian BITs

9. Distinguishing Two Types of Countries and Properly Granting Differential Reciprocity Treatment: Re-comments on the Four Safeguards in Sino-Foreign BITs Not to Be Hastily and Completely Dismantled

10. What should be China’s Strategic Position in the Establishment of New International Economic Order (NIEO)? With Comments on Neo-liberalistic Economic Order, Constitutional Order of the WTO and Economic Nationalism’s Disturbance of Globalization

11. Some Jurisprudential Thoughts upon WTO’s Law-governing, Law-making, Law-enforcing, Law-abiding and Law-reforming

12. Should “the Perspective of South-North Contradictions” Be Abandoned?—Focusing on 2012 Sino-Canada BIT

13. On the Supervision Mechanism of Chinese Foreign-related Arbitration and Its Tally with International Practices

In short, the 24 representative articles written in English by me during the past 30-odd years since the early 1980s, consecutively published mainly in some inter-national leading journals and now being collected and compiled in this monograph, could be deemed as the products of international academic debates. They record, refl ect, and embody my personal views on a lot of contemporary basic issues in international economic law and international economic order. These personal views with Chinese characteristics are deeply rooted in China’s specifi c national situation and the common position of the worldwide weak groups and are signifi cantly and substantially different and independent from some existing voices from Western strong powers. That is why the book is entitled The Voice from China: An CHEN on International Economic Law .

According to their specifi c theme and content, the 24 representative articles are compiled into six parts:

1. Jurisprudence of Contemporary International Economic Law 2. Great Debates on Contemporary Economic Sovereignty 3. China’s Strategic Position on Contemporary International Economic Order Issues 4. Divergences on Contemporary Bilateral Investment Treaty 5. Contemporary China’s Legislation on Sino-Foreign Economic Issues 6. Contemporary Chinese Practices on International Economic Disputes (Cases

Analysis)

Preface

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The “Introduction” following the brief preface contains a related interview dialogue and a related book review. Both of them are selected from the Journal of East Asia and International Law 1 and set here for the convenience of readers to get an overview on my academic advocate in the recent 30-odd years.

The Annex of this Book consists of three articles and one letter, which were con-secutively written by world renowned scholars, Prof. Gosovic Branislav and Prof. Lorin Weisenfeld. These articles and letter have all made profound comments on and have given objective valuation to some of my academic ideas and theoretical views. For comparison, the readers may probably wish to browse these comments and valu-ation. I take this chance to express my cordial thanks to both of them.

Xiamen University, Xiamen City , China An CHENMay 2013

1 See: The Journal of East Asia and International Law , Vol. 4, No. 2, Autumn 2011, pp. 477–514; 533–536.

Preface

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Sponsor Information

This monograph is sponsored by the Chinese Fund for the Humanities and Social Sciences. Many thanks are fi rstly due to the Fund. More specifi cally speaking, this monograph is selected to support by the Chinese Academic Foreign Translation Project (CAFTP). CAFTP is one of the major categories of projects set by the CFHSS and approved by the National Philosophy and Social Science Planning Leading Group of China in 2010. This Project aims to promote Sino-foreign academic exchanges, and to facilitate the outstanding works as well as scholars in the fi eld of philosophy and social science towards the world’s academic stage. For this purpose, a major part of such funding is allocated to sponsor the aforesaid achievements to be published in foreign language through authoritative publishers abroad. It is expected that, by such way of accessing and participating in foreign mainstream distribution channels, foreigners could have a better understanding of contemporary China, its philosophy and social sciences and its traditional culture. It is also expected that Sino-foreign academic exchange and dialogue would hence be more active, and the overseas infl uence of Chinese philosophy and social science would be enhanced.

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Acknowledgements

Heartfelt thanks are due to Korean Prof. Eric Yong Joong Lee, the Editor-in-Chief of the Journal of East Asia and International Law , for his providing related inter-view dialogue; and Chinese Prof. Huiping CHEN, the Deputy Secretary of the Chinese Society of International Economic Law (CSIEL), for her providing related book review. I also sincerely thank Associate Prof. Manjiao CHI, Associate Prof. Dong CHEN, Assistant Prof. Hailang WANG, Ph.D. candidate Mr. Fan YANG, Ph.D. candidate Ms. Qingling LI, Ph.D. candidate Ms. E-Nuo GU, Ph.D. candidate Ms. Yu ZHOU, Ph.D. candidate Ms. Qiushi QU, as well as my personal assistant Ms. Carol Z. CHEN, for their kind help in preparing the English version of some articles in the book.

I especially thank Mr. Jacques Werner, the publisher of the Journal of International Arbitration and the Journal of World Investment & Trade , Ms. Laura Westbrook of Brill, for kindly granting the authorization to republish those articles previously published in the said journals. Heartfelt thanks are also especially due to Mr. Yongbin ZHANG, the deputy editor-in-chief of Fu-Dan University Press, for kindly granting the authorization to republish those articles previously published by the said press.

Ms. Leana Li and Ms. Rajeswari Sathiamoorthy, the editors of the Springer-Verlag, have spent much time in carefully and patiently editing the book. They with their team members are all cordially appreciated.

Xiamen University, Xiamen City, China An CHEN May 2013

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Contents

Part I Jurisprudence of Contemporary International Economic Law

1 On the Marginality, Comprehensiveness, and Independence of International Economic Law Discipline ........................................... 3 1.1 Narrow Interpretation: IEL as a Novel Branch

of Public International Law .............................................................. 4 1.2 Broad Interpretation: IEL as Marginal Synthesis

of International Laws and National Laws That Adjust Cross-Border Economic Relations ................................................... 5

1.3 Analysis Towards the Above Two Groups of Viewpoints ................ 6 1.4 Connection and Difference Between International

Economic Law and Public International Law .................................. 17 1.5 Connection and Difference Between International

Economic Law and Private International Law ................................. 18 1.6 Connections and Differences Between International

Economic Law and Domestic Economic Law ................................. 20 1.7 Connections and Differences Between International

Economic Law and International Business Practices ....................... 24 Annex: Schematic Diagrams of the Mutual Relation as Between International Economic Law and Other Neighboring Legal Departments ...... 27

Integrated Diagram ........................................................................... 27 Decomposed Diagrams .................................................................... 28

References ................................................................................................. 28

2 On the Misunderstandings Relating to China’s Current Developments of International Economic Law Discipline .................. 31 2.1 So-Called Nonscientifi c or Nonnormative ....................................... 32 2.2 So-Called Polyphagian or Avaricious .............................................. 35 2.3 So-Called Fickle Fashion or Stirring Heat ....................................... 36 2.4 So-Called Duplicating Version or Importing Goods ........................ 38 References ................................................................................................. 43

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3 On the Source, Essence of “Yellow Peril” Doctrine and Its Latest Hegemony “Variant”—The “China Threat” Doctrine: From the Perspective of Historical Mainstream of Sino-foreign Economic Interactions and Their Inherent Jurisprudential Principles .............. 45 3.1 Introduction: Is “China Threat Doctrine” History or Reality,

Fabrication or Truth? ........................................................................ 46 3.2 Origin and Essence of “Yellow Peril Doctrine” ............................... 49

3.2.1 1870s Version of “Yellow Peril” and “China Threat” by Tsar Russia ...................................................................... 51

3.2.2 1890s Version of “Yellow Peril” and “China Threat” by the German Empire ......................................................... 53

3.2.3 Primitive Version of “Yellow Peril” and “China Threat” by American Hegemonism from the Middle Nineteenth Century to the Late Twentieth Century ............. 57

3.2.4 Revised Version of “Yellow Peril” and “China Threat” by American Hegemonism Since the Twenty-First Century, with the Inheritance from and Development to Its Predecessors ................................................................ 64

3.3 Back to Historical Truth: The Long-Standing Mainstream of Sino-Foreign Economic Interactions and Their Inherent Jurisprudential Principles ................................................................. 68 3.3.1 China’s Present National Policy of Opening Up

Is the Flourish and Development of Its Fine Traditions in History ............................................................ 68

3.3.2 Ancient China’s External Economic Interaction and Its Jurisprudential Principles ......................................... 70

3.3.3 Semicolonial and Semifeudal China’s External Economic Interaction and Its “Jurisprudential” Principles ................... 81

3.3.4 Socialist China’s External Economic Interaction and Its Jurisprudential Principles ......................................... 85

3.3.5 China’s Peaceful Rising and Its Long-Term Peaceful Foreign Policy Are Historically Inevitable .......................... 91

3.4 Concluding Remarks: Respecting Historical Truth and Reaching Consensus .................................................................. 97

References ................................................................................................. 98

Part II Great Debates on Contemporary Economic Sovereignty

4 The Three Big Rounds of US Unilateralism Versus WTO Multilateralism During the Last Decade: A Combined Analysis of the Great 1994 Sovereignty Debate Section 301 Disputes (1998–2000) and Section 201 Disputes (2002–2003) ............................. 103 4.1 Introduction ...................................................................................... 104 4.2 Ignition of the Section 201 Disputes: US Unilateralism

and Sovereignty ................................................................................ 107

Contents

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4.3 Confl icts of Sovereignties in the Formation of the WTO System .. 111 4.4 The Refraction of Such Confl icts in the United States:

“ The Great 1994 Sovereignty Debate ” ........................................... 113 4.4.1 Away with the “S” Word: [Sovereignty

of Other States]! ............................................................... 114 4.4.2 Never Away with the US “S” Word: [“Sovereignty”

(Hegemony) of the United States!] .................................. 115 4.4.3 The “Contradiction” and Coordination Between

“Spear” and “Shield”........................................................ 121 4.4.4 Some Discussions on “Double Standards,” etc. ............... 122

4.5 “The Great 1994 Sovereignty Debate” and Section 301 ................ 125 4.6 The US–EU Economic Sovereignty Disputes Caused

by Section 301: Origin and Prelude ............................................... 128 4.6.1 US–Japan Auto Disputes.................................................. 129 4.6.2 US–E.C. Banana Disputes................................................ 130 4.6.3 US–E.C. Section 301 Dispute .......................................... 133

4.7 The US–EU Economic Sovereignty Disputes Caused by Section 301: Claims and Rebuttals ........................................... 135 4.7.1 The Claims of the E.C. Representatives ........................... 135 4.7.2 The Rebuttals of the United States ................................... 138

4.8 The WTO/DSB Panel Report on the Section 301 Case ................. 140 4.9 The Equivocal Law-Enforcing Image Concluded from

the Panel Report ............................................................................. 142 4.9.1 The Panel Creates a Limit for Its Own Duty, Is Overly

Cautious, Dares Not to Transgress the “Mine Bounds,” and Is Irresponsible for Its Duties .................................... 143

4.9.2 The Panel Hovers Between the “Two Powers” in Its Attempt to Ingratiate Itself with Both Sides ........... 144

4.9.3 The Panel Leaves the Offender at Large, Criticizing Pettily While Doing It Great Favor .................................. 146

4.9.4 The Panel Is Partial to and Pleading for Hegemony and Thus Leaves a Lot of Suspicions and Hidden Perils ............................................................. 147

4.10 The Remaining Suspicions and Latent Perils Entailed by the Panel Report ........................................................................ 148 4.10.1 The First Suspicion and Latent Peril ................................ 148 4.10.2 The Second Suspicion and Latent Peril ........................... 150 4.10.3 The Third Suspicion and Latent Peril .............................. 151 4.10.4 The Fourth Suspicion and Latent Peril ............................. 153

4.11 Conclusion...................................................................................... 156 References ................................................................................................. 158

5 On the Implications for Developing Countries of “the Great 1994 Sovereignty Debate” and the EC–US Economic Sovereignty Disputes ............................................................. 159 Reference .................................................................................................. 163

Contents

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Part III China’s Strategic Position on Contemporary International Economic Order Issues

6 What Should Be China’s Strategic Position in the Establishment of New International Economic Order? With Comments on Neoliberalistic Economic Order, Constitutional Order of the WTO, and Economic Nationalism’s Disturbance of Globalization ....................................................................................... 167 6.1 Introduction: International Economic Order, International Economic Law, the Global South–North Contradiction, and China’s Strategic Position ......................................................... 168 6.2 China’s Self-Positioning in History ................................................. 170

6.2.1 Self-Positioning of Ancient China ....................................... 170 6.2.2 Self-Positioning of Modern China ....................................... 171 6.2.3 Mainstream National Consciousness Developed

from Post-Opium War for More Than 160 Years and Its Infl uence on China’s Self-Positioning ...................... 172

6.3 China’s Self-Positioning in the Future: To Be One of the Driving Forces and Mainstays for the Establishment of the NIEO ...................................................................................... 174 6.4 Comprehensive and Accurate Understanding of Deng Xiaoping’s

28-Word Foreign Policy Is a Must for Scientifi cally Establishing China’s Position ........................................................... 176

6.5 Brief Comments on Theories of Contemporary International Economic Order and China’s Positioning ........................................ 190 6.5.1 Neoliberalistic Economic Order ........................................... 190 6.5.2 Constitutional Order of the WTO ........................................ 196 6.5.3 Economic Nationalism’s Disturbance of Globalization ....... 200

6.6 Conclusions ...................................................................................... 203 References ................................................................................................. 204

7 A Refl ection of the South–South Coalition in the Last Half Century from the Perspective of International Economic Lawmaking: From Bandung, Doha, and Cancún to Hong Kong ....... 207 7.1 Introduction ...................................................................................... 207 7.2 From Bandung to Hong Kong: The South–South Coalition

Progresses Unevenly ........................................................................ 209 7.2.1 The Bandung Conference Among the South–South

Countries: The First Asian–African Conference ................. 209 7.2.2 The Group of 77 Among the South Countries ..................... 210

7.3 The Fresh Countenance and Forthcoming Obstacles of the South–South Coalition in the Doha–Cancún Process ............ 214

7.4 The Status Quo and Prospects for the South–South Coalition from Cancún to Hong Kong ............................................................. 218 7.4.1 The Multilateral Negotiations Are in Stagnation

After the Cancún Deadlock ................................................. 218

Contents

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7.4.2 The Prospect of the South–North Multilateral Negotiation Grows Brighter ................................................. 219

7.4.3 The South–North Multilateral Negotiation Again Dims ..... 220 7.4.4 The Positive Fruits of the Hong Kong Conference

with Heavy Negative Comments: Shown Up After Numerous Appeals but Still Half-Masked ........................... 227

7.4.5 New Highlights in the South–North Confl ict: Judicial Breakthrough in Recently Litigated WTO Agricultural Disputes ............................................................................... 232

7.5 Assessment of the Trend After the Hong Kong Conference in the Light of the Historical Track of the South–South Coalition During the Last 50 Years .................................................. 233 7.5.1 The Historical “6C” Track of South–North Confl icts

and Its Characteristics .......................................................... 233 7.5.2 To Doha Round’s Success: No Way Except Through

the Tenacious South–South Coalition .................................. 235 References ................................................................................................. 238

8 Some Jurisprudential Thoughts upon WTO’s Law-Governing, Law-Making, Law-Enforcing, Law-Abiding, and Law-Reforming ... 241 8.1 China’s Age in the WTO Having Reached Full

9 and Entered 10............................................................................... 242 8.2 WTO and Its Related International Economic Relationships

Must Be Governed by Law .............................................................. 242 8.3 “6C Rule” Embedded in the Law-Making Process of IEL

for the Past 60 Years ......................................................................... 243 8.4 Relationships Among Law-Making, Law-Abiding and

Law-Reforming of the WTO and Its “Rules of Game” ................... 245 8.4.1 Should International Weak Groups Wholly Deny

or Entirely Accept Existed WTO and Its “Rules of Game” at All? .................................................................. 246

8.4.2 Is Law-Reforming of the WTO and Its “Rules of Game” Nothing but a “Political Challenge”?................................... 246

8.5 Is the WTO’s Law-Enforcing Body DSB “Bao Qingtian” in the Field of International Economy? ............................................ 248 8.5.1 The “Congenital Defi ciency” of the WTO’s

Law-Enforcing Body DSB................................................... 249 8.5.2 The “Postnatal Imbalance” of the WTO’s

Law-Enforcing Body DSB ..................................................... 252 8.6 To Attain Goodness and Avoid Harmfulness in Law-Abiding

and Law-Adapting, to Promote Law-Reforming and Strengthen Up Weak Through South–South Coalition....................................... 254

8.7 Rugged and Tough Path for Weak Groups to Promote Law-Reforming and Strengthen Themselves Up, yet a Bright Prospect Through Advancing with Time ......................................... 258

Contents

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8.7.1 Rugged and Tough Path for Weak Groups to Promote Law-Reforming and Their Accumulated Achievements During 1947–2000 ............................................................... 258

8.7.2 Rugged and Tough Path for Weak Groups to Promote Law-Reforming During 2001: Present and Their Bright Future ...... 264

8.8 Brief Conclusions ............................................................................. 267 References ................................................................................................. 268

Part IV Divergences on Contemporary Bilateral Investment Treaty

9 Should the Four “Great Safeguards” in Sino- foreign BITs Be Hastily Dismantled? Comments on Critical Provisions Concerning Dispute Settlement in Model US and Canadian BITs .... 273 9.1 The Provisions Concerning Dispute Settlement in the Chinese

BITs and Their Correspondence with Relevant Provisions in the ICSID Convention .................................................................. 274

9.2 Essential Provisions Concerning Dispute Settlement in US and Canadian Model Bits ................................................................. 279

9.3 China Should Not Hastily Accept the Above US and Canadian Provisions or Their Variations When Negotiating and/or Concluding BITs ................................................................... 282 9.3.1 Such Provisions Deviate from the Rights Authorized

to Host Countries by International Conventions .................. 282 9.3.2 Such Provisions Do Not Match China’s Current

Circumstances ...................................................................... 288 9.3.3 Such Provisions Ignore the Bitter Lessons of Some

Bits Harming Weak Countries: The Warning from Argentina’s Dilemma .................................................. 295

9.3.4 Such Provisions Ignore the Latest Legislative Track-Shift in Two Host Countries: Argentina and the United States ...... 298

9.4 Suggestions for Future Sino-foreign BIT Negotiations ................... 302 9.4.1 Strengthening Investigation and Research on Recent

Developments in BIT Practice and Acting with High Caution ................................................................ 302

9.4.2 Using Well the Authorizations of Relevant Conventions and Firmly Holding onto the Four Great Safeguards .......... 303

9.4.3 Insisting on “Never Repeat” and Timely “Mending the Fold After Some Sheep Have Been Lost” ..................... 304

References ................................................................................................. 306

10 Distinguishing Two Types of Countries and Properly Granting Differential Reciprocity Treatment: Re-comments on the Four Safeguards in Sino-Foreign BITs Not to Be Hastily and Completely Dismantled ................................................................... 309 10.1 Background .................................................................................... 310 10.2 Major Viewpoints in “The First Comments” ................................. 313

Contents

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10.3 Some New Thoughts for Future Sino-Foreign BIT Negotiations ............................................................................ 315 10.3.1 Strengthening Investigation and Research

on Recent Internal and External Developments and Acting with High Caution ......................................... 315

10.3.2 Using Well the Authorizations of the Relevant Conventions and Firmly Uphold the Four Great Safeguards ........................................................................ 316

10.3.3 Distinguishing Two Kinds of Countries, Granting Differential Reciprocity, Excluding or Limiting the Application of MFN to International Dispute Settlement Procedures ........................................ 317

10.4 The Theoretical Grounds and Practical Precedents for Adopting Differential Treatment Based on the Distinguishing Two Types of Countries .............................. 324 10.4.1 Differential Treatment Conforms to the Universal

Philosophy of “Analyze Issues Under Their Concrete Situations” ........................................................................ 324

10.4.2 Differential Treatment Conforms to the Basic Jurisprudence of “Equity and Mutual Benefi t” ................ 324

10.4.3 Differential Treatment Conforms to the Basic International Law Principle of Supremacy of State Sovereignty ......................................................... 326

10.4.4 Differential Treatment Conforms to the Evolution of the Principle of MFN Treatment .................................. 327

10.4.5 Differential Treatment and Exclusion or Limitation of the Application of MFN Treatment to the Dispute Settlement Procedures Conforms to the Latest Repeated Warnings from UNCTAD ................................. 329

10.4.6 Differential Treatment Conforms to the Current International Arbitration Practices ................................... 330

10.4.7 The Precedents of Granting Differential Treatment and Excluding or Limiting the Application of MFN Clause ................................................................. 332

10.5 Conclusion...................................................................................... 333 References ................................................................................................. 334

11 Queries to the Recent ICSID Decision on Jurisdiction Upon the Case of Tza Yap Shum v. Republic of Peru: Should China–Peru BIT 1994 Be Applied to Hong Kong SAR Under the “One Country, Two Systems” Policy? ........................ 337 11.1 Introduction: Summary of the Dispute ........................................... 338 11.2 Main Issues and Basic Academic Views ........................................ 339

11.2.1 Main Issues....................................................................... 339 11.2.2 Basic Academic Views ..................................................... 340 11.2.3 Three Aspects of Queries ................................................. 340

Contents

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11.3 Queries upon Applicability of China–Foreign BITs to Chinese Nationals with the Right of Abode in Hong Kong ......................... 341 11.3.1 Historical Overview of Hong Kong Before

and After Its Return to China ........................................... 341 11.3.2 The China–British Joint Declaration ................................ 342 11.3.3 The Joint Liaison Group................................................... 343 11.3.4 The Basic Law of the Hong Kong Special

Administrative Region ..................................................... 344 11.3.5 Applicability of the China–Peru BIT 1994

to Hong Kong Residents .................................................. 352 11.4 Queries upon Scope of the Arbitration Provision

in the China–Peru BIT 1994 .......................................................... 353 11.4.1 Historical Overview of China’s Accession

to the ICSID Convention .................................................. 353 11.4.2 China’s Policy on the Resolution of Investment

Treaty Disputes ................................................................ 356 11.4.3 Scope and Nature of the Dispute Resolution

Provision in the China–Peru BIT 1994 ............................ 363 11.5 Queries upon the Twisted Interpretation Against Articles 31

and 32 of the Vienna Convention of Laws of Treaties ................... 365 11.5.1 How Did the Tribunal Twistingly Interpret

Articles 31 and 32 of VCLT? ........................................... 365 11.5.2 What Scientifi c Approaches Should Be Used to Find

True and Correct Interpretation on Articles 31 and 32 of VCLT per se and the Peru–China BIT 1994? .............. 367

11.5.3 With Respect to Key Instruments Such as Joint Declaration and Basic Law .............................................. 367

11.5.4 With Respect to Rules of International Law Applicable in the Relations Between the Parties ............. 369

11.5.5 With Respect to Specifi c Circumstances of the Conclusion of Peru–China BIT 1994 ..................... 369

11.6 Conclusion: ICSID’s Decision on Case No. Arb/07/6 Is Incorrect, Unreasonable, and Unacceptable ............................... 371

References ................................................................................................. 371

12 Should “The Perspective of South–North Contradictions” Be Abandoned?: Focusing on 2012 Sino-Canada BIT ......................... 373 12.1 China’s Scientifi c Position: Still a Developing Country,

Belonging to the South Camp ........................................................ 375 12.2 The Source and Stream of South–North Contradictions ................ 377

12.2.1 The Essence of Modern BIT: A Product of South–North Contradiction .......................................... 379

12.2.2 Conclusion of South–North BIT: A Process of Benefi ts Exchange and Mutual Compromise, Not Necessarily a Process in Pursuit of “Universal Values” ...................... 380

Contents

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12.3 2012 Sino-Canada BIT as a Typical Example of South–North Benefi ts Exchange and Mutual Compromise: Focusing on the “Expropriation and Compensation Clause” ........................ 381 12.3.1 South–North Divergence on “Compensation

Standard” .......................................................................... 383 12.3.2 South–North Divergence on “Compensation

Evaluation” ....................................................................... 384 12.3.3 A Recent South–North Compromise on Compensation

for Expropriation and Its Valuation Criteria..................... 387 12.4 2012 Sino-Canada BIT as a Typical Example of South–North

Benefi ts Exchange and Mutual Compromise: Focusing on the “Dispute Settlement Clause” ............................................... 388 12.4.1 South–North Divergence and Compromise on MFN

Treatment Exception ........................................................ 389 12.4.2 South–North Divergence and Compromise

on Financial and Prudential Carve-Out ............................ 391 12.4.3 South–North Divergence and Compromise

on Taxation Carve-Out ..................................................... 392 12.4.4 South–North Divergence and Compromise

on the Exception of Exhaustion of Local Remedies ........ 394 12.4.5 South–North Divergence and Compromise

on the National Security Exception.................................. 396 12.5 Doha Round: Clear Evidence that Perspective of South–North

Contradictions Should Not Be Abandoned in the Construction of International Economic Rules .................................................... 397

12.6 Concluding Remarks ...................................................................... 399 12.7 Annex: Interpretation of China–Canada Bilateral Investment

Protection Agreement by an Offi cial from the Department of Treaty and Law of MOFCOM ................................................... 400 12.7.1 What Are the Main Contents of the Agreement? ............. 400 12.7.2 What Is the Signifi cance of Signing the Agreement? ...... 402

References ................................................................................................. 402

Part V Contemporary China’s Legislation on Sino-Foreign Economic Issues

13 To Open Wider or to Close Again: China’s Foreign Investment Policies and Laws ................................................................ 407 13.1 The 1982 Constitution .................................................................... 407 13.2 Current Policies .............................................................................. 408

13.2.1 Coordination with China’s Economic Aims .................... 409 13.2.2 Just Rights and Legal Profi ts ............................................ 410 13.2.3 Full Decision-Making Power ........................................... 411 13.2.4 Attraction of Foreign Investors ........................................ 412

Contents

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13.3 Substantive Laws ............................................................................ 415 13.3.1 Joint Venture Law ............................................................ 415 13.3.2 Law of Special Economic Zones ...................................... 432 13.3.3 Economic Contract Law ................................................... 437 13.3.4 Sino-Foreign Economic Contract Law ............................. 439 13.3.5 Trademark Law ................................................................ 439 13.3.6 Patent Law ........................................................................ 442

13.4 Procedure Laws .............................................................................. 446 13.4.1 Civil Procedure Law ......................................................... 446 13.4.2 Arbitration Rules .............................................................. 448

13.5 Conclusion...................................................................................... 451 References ................................................................................................. 452

14 To Close Again or to Open Wider: The Sino-US Economic Interdependence and the Legal Environment for Foreign Investment in China After Tiananmen .................................................. 453 14.1 Washington: Most Favored Nation ≠ Most Favorite Nation ........... 454 14.2 Beijing: MFN-China, United States in the Same Boat .................. 455 14.3 Quiet Swallows Sensitive to Climate ............................................. 457 14.4 Six New Facets Added to the Legal ............................................... 459

14.4.1 Joint Ventures Law Amended .......................................... 460 14.4.2 Land-Tract Development Measures Promulgated ............ 461 14.4.3 Pudong: A Heart-Side Area Widely Opened ................... 462 14.4.4 Tax Law for Foreign Investors Being Unifi ed

and Made More Preferential ............................................. 463 14.4.5 Administrative Procedure Law Enforced ......................... 464 14.4.6 ICSID System Accepted .................................................. 465

14.5 The Baby and the Bath Water ........................................................ 465

15 Should an Absolute Immunity from Nationalization for Foreign Investment Be Enacted in China’s Economic Law? .............................. 467 15.1 Reasons for Raising the Question .................................................. 467 15.2 Two Different Views ...................................................................... 468 15.3 The Writer’s Personal Views .......................................................... 471 References ................................................................................................. 480

16 China’s Special Economic Zones and Coastal Port Cities: Their Development and Legal Framework .......................................... 483 16.1 Theoretical Debates ........................................................................ 484 16.2 Practical Development ................................................................... 486 16.3 Baby and Dirty Water: Maturation of the Policy ........................... 491

16.3.1 The Yang Yibang Case ..................................................... 492 16.3.2 The Zhou Zhirong Case ................................................... 493 16.3.3 The Wang Zhong Case ..................................................... 495

16.4 Legal Framework ........................................................................... 503 16.4.1 Preferential Tax Treatments in SEZs, ETEDEZs,

COPOCIs, and CEOAs ................................................... 504

Contents

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16.4.2 Labor and Wages in SEZs, ETEDEZs, COPOCIs, and CEOAs ....................................................................... 515

16.4.3 Land Use and Management in the SEZs, ETEDEZs, COPOCIs, and CEOAs .................................................... 518

16.4.4 Enterprise Registration in the SEZs, ETEDEZs, COPOCIs, and CEOAs .................................................... 521

16.4.5 Technology Imports into the SEZs, ETEDEZs, COPOCIs, and CEOAs .................................................... 525

16.4.6 Foreigners Entering and Leaving China’s SEZs .............. 528 16.4.7 Economic Combination Between the SEZs et al.

and Inlands ...................................................................... 529 16.5 Latest Incentives ............................................................................. 531

16.5.1 Lower Taxes ..................................................................... 536 16.5.2 Lesser Fees ....................................................................... 538 16.5.3 Cheaper Labor .................................................................. 539 16.5.4 More Preferences ............................................................. 540 16.5.5 Greater Autonomy ............................................................ 541 16.5.6 Simpler Formalities .......................................................... 542

References ................................................................................................. 546

17 Why Some Sino-foreign Economic Contracts Are Void and How Voidness Can Be Prevented .................................................... 547 17.1 Contracts Must Be Observed and Illegal Contracts Are Void ....... 547 17.2 The “Eel Fry” Incident: A Series of Illegal Contracts ................... 550 17.3 Contracts with Unqualifi ed Parties Are Void ................................. 554

17.3.1 A Noncorporate Body Cannot Be a Party to a Foreign Economic Contract ..................................... 555

17.3.2 A Corporation That Is Prohibited by Law Cannot Be a Party to a Foreign Economic Contract ..................... 555

17.3.3 A Corporation Cannot Be a Party to a Sino-foreign Economic Contract That Is Outside Its Registered Business Scope ................................................................. 556

17.3.4 At Present, Chinese Citizens Cannot Generally Act in Their Individual Status as Parties to Sino-foreign Economic Contracts ......................................................... 558

17.4 Contracts with Illegal Contents Are Void ...................................... 560 17.5 Two Contracts Involving Hong Kong ............................................ 568 17.6 Preventing the Formation of Invalid Contracts

and Handling These Contracts ....................................................... 575 Reference .................................................................................................. 579

18 On the Supervision Mechanism of Chinese Foreign-Related Arbitration and Its Tally with International Practices ........................ 581 18.1 Introduction .................................................................................... 581 18.2 Promulgation of the Arbitration Law ............................................. 582

Contents

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18.3 A Comparison Among China’s Trial Supervision, Domestic Arbitration Supervision and Foreign-Related Arbitration Supervision, and Some Pending Issues .......................................... 584

18.4 A Discussion on the Reasonableness of China’s Separate Legislation for Domestic and Foreign-Related Arbitration Supervision .................................................................. 591 18.4.1 The Issue on Tallying Provisions Concerning

Foreign-Related Arbitration Supervision of Arbitration Law with Those of Civil Procedure Law ......................... 592

18.4.2 The Issue on Tallying Provisions Concerning Foreign-Related Arbitration Supervision of Arbitration Law with Those of International Treaties ........................ 596

18.4.3 The Issue on Tallying Provisions Concerning Foreign-Related Arbitration Supervision of Arbitration Law with Those of Advanced Practices in Current Arbitration Enactments of Other Countries ..................... 600

18.4.4 The “Uniqueness” of China’s Foreign-Related Arbitration Supervision and the Necessity of Tallying Its Supervision Mechanism with International Treaties and Practices ....................................................... 608

18.5 Some Ideas on How to Strengthen the Current Chinese Foreign-Related Arbitration Supervision Mechanism ................................................................. 618

References ................................................................................................. 621

19 Is Enforcement of Foreign Arbitral Awards an Issue for Establishment and Improvement in China? ................................... 623 19.1 1949–1978 (About 30 Years): Related-Legislation Blank ............. 623 19.2 1979–1994 (15 Years): Domestic Legislation Established

and International Conventions Acceded......................................... 624 19.2.1 Promulgating PRC’s Civil Procedure Law

(For Trial Use) .................................................................. 624 19.2.2 Acceding to the New York Convention of 1958 .............. 624 19.2.3 Acceding to the Washington Convention of 1965 ............ 625 19.2.4 Promulgating PRC’s Civil Procedure Law (Formal) ....... 625 19.2.5 Promulgating PRC’s Arbitration Law .............................. 626

19.3 1995–Present: Judicial Explanations Added .................................. 627 19.3.1 Obstacles from “Local Protectionism”............................. 627 19.3.2 “Double Report System” Preliminary Established:

To Overcome the “Local Protectionism” ......................... 628 19.3.3 “Double Report System” Strengthened: To Overcome

the “Local Protectionism” ................................................ 630 19.4 Domestic Legislations Need to Be Further Improved .................... 630

Contents

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Part VI Contemporary Chinese Practices on International Economic Disputes (Cases Analysis)

20 The Truth Among the Fogbound “Expropriation” Claim: Comments on British X Investment Co. Versus British Y Insurance Co. Case ............................................................................. 635 20.1 Summary of the Case ..................................................................... 635 20.2 Questions for Answers ................................................................... 637 20.3 Expert’s Views and Opinions ......................................................... 638

20.3.1 In the CJV Contract Dated on 25 December 1996, Which Aimed to Establish C Power Company, the Provisions of Article 15 on Distribution of Profi t Were in Compliance with the Laws at That Time and Have Been in Compliance with the Laws ................. 638

20.3.2 For the “Circular [1998] No. 31” of the State Council on Strengthening the Administration and Carrying on Check of the Foreign Exchange and Foreign Debt Issued in September 1998, Its Legal Force Is Not Complete ........ 639

20.3.3 The “Circular [1998] No. 31” Has No Legal Effect of Retroactivity ................................................................. 641

20.3.4 Actually, the Aforesaid Prohibitive Provisions in the “Circular [1998] No. 31” Have Been Amended Again and Again in 2002 and 2004 .................................. 643

20.3.5 “Circular [2002] No. 43” Is Not an “Expropriation Decree”; New Agreements on 11 March 2003 Are Not “Behaviors of Expropriation”............................. 646

20.3.6 Provisions in the Foreign Investment Regulations and “Bilateral Investment Agreement Between PRC and UK” Concerning the Expropriation of Foreign Investment ........................................................................ 650

20.4 Conclusion...................................................................................... 652

21 The Approach of “Winning from Both Sides” Used in the “Expropriation” Claim: Re-comments on British X Investment Co. Versus British Y Insurance Co. Case ...................... 655 21.1 [Q1] and [A1] ................................................................................. 655 21.2 [Q2] and [A2] ................................................................................. 657 21.3 [Q3] and [A3] ................................................................................. 657 21.4 [Q4] and [A4] ................................................................................. 658 21.5 [Q5] and [A5] ................................................................................. 659 21.6 [Q6] and [A6] ................................................................................. 660 21.7 [Q7] and [A7] ................................................................................. 661 21.8 [Q8] and [A8] ................................................................................. 662 21.9 [Q9] and [A9] ................................................................................. 663

Contents

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21.10 [Q10] and [A10] ........................................................................... 663 21.11 [Q11] and [A11] ........................................................................... 664 21.12 [Q12] and [A12] ........................................................................... 665 21.13 [Q13] and [A13] ........................................................................... 669 21.14 [Q14] and [A14] ........................................................................... 669

22 On the Serious Violation of Chinese Jus Cogens: Comments on the Case of Importing Toxic Brazilian Soybeans into China (Expert’s Legal Opinion on Zhonghe Versus Bunge Case) ................. 675 22.1 Brief CV of the Expert ................................................................. 676 22.2 Summary of the Case ................................................................... 677 22.3 Questions Consulted..................................................................... 679 22.4 Expert’s Views and Opinions ....................................................... 680 22.5 Brief Conclusion .......................................................................... 689 Reference .................................................................................................. 690

23 Isn’t the Strict Prohibition on Importing Toxic Brazilian Soybeans into China “Illegal”?—A Rebuttal to Lawyer Song’s Allegation ........ 691 23.1 Procedural Unfairness .................................................................. 692 23.2 Partiality of Mr. Song ................................................................... 692 23.3 The Powers and Authority of AQSIQ .......................................... 693 23.4 Whether Professor CHEN Is Qualifi ed to Deal

with English Law ......................................................................... 711

24 Three Aspects of Inquiry into a Judgment: Comments on the High Court Decision, 1993 No. A8176, in the Supreme Court of Hong Kong ................................................................................ 717 24.1 Introduction .................................................................................. 717 24.2 Brief Facts .................................................................................... 718 24.3 Query One to the Judgment: On the Jurisdiction of the Case ........ 723

24.3.1 The Judgment Detained and Left the Jurisdiction over the Case to the Court of Hong Kong, Obliterated the Close Connections Among Contract A158, Contract B, and Contract C, as Well as Those Between Contract A158 and Bill of Exchange 10732C. It Thus Thoroughly Violated the Legal Principles of “Autonomy of Will” and Pacta Sunt Servanda .............. 724

24.3.2 The Judgment Detained and Left the Jurisdiction over the Dispute of the Bill of Exchange to the Court of Hong Kong and Refused to Stay the Proceedings of the Case, Thus Thoroughly Violating the Hong Kong Arbitration Ordinance ........................... 729

24.3.3 The Judgment Detained and Left the Jurisdiction over the Dispute of the Bill of Exchange to the Court of Hong Kong and Refused to Stay the Proceedings of the Case, Thus Thoroughly Violating the International Treaty That Britain Has Acceded to and to Which Hong Kong Is Legally Bound ........................................ 731

Contents

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24.3.4 The Judgment Detained and Left the Jurisdiction over the Dispute of the Bill of Exchange to the Court of Hong Kong, Thus Thoroughly Violating Universally Acknowledged International Practice ........... 732

24.3.5 The Judgment That Detained and Left the Jurisdiction over the Dispute of the Bill of Exchange to the Court of Hong Kong Is a Lack of Due Respect for Chinese Laws and Regulations That Tally with International Practice ............................................... 734

24.4 Query Two to the Judgment: On the Recognition in Chinese Law of the “Autonomy” of the Bill of Exchange Dispute in This Case ................................................................................... 739 24.4.1 There Does Not Exist in the Laws of China Such

a Strange Expression of “The Autonomy of Bills of Exchange” and Absolute “Independence” of Bills of Exchange as Extremely Esteemed by Mr. Dicks ......... 740

24.4.2 Mr. Dicks’ Citations from the Procedures for Bank Settlements of China Are Garbled and Out of Context .... 741

24.4.3 When Citing Mr. Guo Feng’s Article, Mr. Dicks Has Emasculated Its Rerequisite and Garbled Its Original Meaning............................................................................ 743

24.4.4 Mr. Dicks’ Opinion Runs Counter to the Generally Accepted Viewpoints of Chinese Academic Works on Bill Laws, the Stipulations of Relevant International Convention, and the Bill Law of China ............................ 745

24.4.5 Mr. Dicks Has Distorted the Original Text When Quoting the Civil Procedure Law of PRC as Evidence for the Said “Autonomy of Bills of Exchange” ................ 748

24.5 Query Three to the Judgment: On the Defendant’s Right of Defense in This Case ................................................................. 749 24.5.1 The Reason “It Was Too Late” Is Not Tenable ................ 750 24.5.2 Denying Equal Right of Defense to the Defendant

Is Against the Principle of Equity and International Practice on Litigation Procedures .................................... 751

24.6 Conclusion: The Judgment Based on the Presumptuously Fabricated Rules (Made by Mr. Kaplan and Mr. Dicks) Will Defi nitely Lose All Its Legal Binding Effect ......................... 752

References ................................................................................................. 752

Annex ............................................................................................................... 753

Index ................................................................................................................. 781

Contents

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Abbreviations

AB Appellate Body AHB Appellant’s Hearing Bundle ASEAN Association of South-East Asian Nations BIT Bilateral Investment Treaty CARICOM Caribbean Community and Common Market CCCPC Central Committee of Communist Party of China CEOA Coastal economically open areas CIA Central Intelligence Agency COCOM Coordinating Committee for Export Control COPOCI Coastal port cities CPC Communist Party of China DDR Doha Development Round DSB Dispute Settlement Body ELO Expert’s Legal Opinions ETEDEZ Economic and technological development zones FDI Foreign direct investment GATT 1947 General Agreement on Tariffs and Trade GSP Generalized System of Preferences IBL International Business Law IBP International Business Practices ICSID International Centre for Settlement of Investment Disputes IEL International Economic Law IELR International Economic Legal Relation IEO International Economic Order IER International Economic Relations ITL International Trade Law LDCs Least developed countries MIGA Multilateral Investment Guarantee Agency NAM Non-Aligned Movement NAMA Non-agricultural market access

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NIEO New International Economic Order OAU Organization of African Unity OIEO Old International Economic Order OPIC Overseas Private Investment Corporation Private IL Private International Law Public IL Public International Law SEZ Special economic zones TLD Transnational Law Doctrine UNCTAD United Nations Conference on Trade and Development UNDP United Nations Development Program WTO World Trade Organization WWII World War II

Abbreviations

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Introd uction

A Dialogue with Judicial Wisdom, Prof. An CHEN: A Flag- Holder Chinese Scholar Advocating Reform of International Economic Law (By Prof. Eric Yong Joong Lee) 1

1. Professor CHEN! Thank you so much for doing this interview with the Journal of East Asia & International Law . It is truly a great honor for us to talk with such a highly renowned international lawyer like you. Following our tradition, I would like to begin our interview with some personal ques-tions. Where were you born? Would you briefl y talk about your family? How did your parents’ education infl uence your ideas and outlook?

1 This dialogue was fi rst published in The Journal of East Asia and International Law , Vol. 4, No. 2, Autumn 2011, pp. 477–514.

Korean Prof. Eric Yong Joong Lee is now the Editor-in-Chief of the said Journal of East Asia and International Law.

Photo 1 Prof. CHEN, at his study room (2008)

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I was born in a small mountainous town in northeast Fujian Province called Muyang in Fu’an County. My father was a Xiu Cai (a scholar passing the impe-rial examination at the county level in Ming and Qing Dynasties of premodern China) in the late Qing Empire. He had an excellent command of poetry, litera-ture, and calligraphy. He was a faithful follower of Confucianism and an upright and honest person longing for social justice and fairness. I was profoundly infl uenced by him since my childhood and thus determined to be an honest and industrious person (堂堂正正做人,勤勤懇懇治學) like him.

2. While you were growing up, Chinese society and politics were more tumul-tuous than in any other periods for the past few hundred years. You expe-rienced the foreign occupation, the war against Japan, the civil war, and the socialist revolution. How did you face this turbulent environment as a young student? What brought you fi nally to study law at university? China holds one of the most ancient and glorious civilizations in the world and has contributed immensely to human culture. Most Chinese people are very proud of this. However, since the notorious Opium War in 1840, China had suf-fered from aggression and suppression by the Western powers and Japan for more than a century, which is a humiliation to all Chinese people. When I was young, I was taught of the glorious civilization of China, but I was also edu-cated by and personally experienced the sad national crisis of China. Such com-plex emotions gradually nurtured my strong sense of national pride and patriotism, my determination to fi ght against international hegemonism, and my ambition to strive for social justice, and thus I gradually became determined to use my knowledge to contribute to my own country and to support all other weak countries in the world.

3. I heard that it was quite diffi cult to study international law up until the late 1970s in China. How were you able to keep your ideas and knowledge on modern international law for this period? As is known to all, from the late 1950s, China suffered from a fragile social and political situation for 20 years. During this period, the legal research and the legal academic community in China also withered. As a junior teacher in the university at that time, I had to shift my teaching fi eld from law to Marxism and Leninism in 1953 due to the national “high education disciplinary adjustment.” As you may imagine, I was gradually kept away from law fi eld due to such shift, not to men-tion keeping my mind abreast with the progress of modern international law.

4. Since 1978, the study of international law in China has seen rapid growth and many Chinese legal scholars are actively working in various fi elds. Would you briefl y describe the developing process of international law studies in China? What do you think was the most important event and who were some infl uential fi gures in this course? I think the resolution adopted by the Third Session of the 11th National Congress of the Chinese Communist Party in late 1978 was critical. This Congress corrected social chaos and restored social order and inaugurated the state policy of reform and opening up formulated by the late leader Xiaoping

Introduction

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Deng. Without this policy, there would have been no revival of the Chinese legal community. I would say this Congress is the most important turning point in modern Chinese history. After that, the legal community in China began to thrive gradually over time. As to some infl uential fi gures, I would recommend the following most prominent academic pioneers:

1. In the fi eld of public international law: Prof. Tieya Wang of Beijing University and Prof. Tiqiang Chen of Chinese Foreign Affairs University

2. In the fi eld of private international law: Prof. Depei Han of Wuhan University and Prof. Haopei Li of Chinese Foreign Affairs University

3. In the fi eld of international economic law (IEL): Prof. Meizhen Yao of Wuhan University and Prof. Ding Liu of Renmin University of China

5. In the early 1980s, you debated with Prof. Jerome Cohen of Harvard Law School regarding cross-border investment. After that, Prof. Cohen said: “Your knowledge added to my shortage.” Would you please tell me more about the debate? Then, from 1981 to 1983, you were invited to study and lecture at Harvard. What have you gained from it? How has it infl uenced your academic career afterward? In the spring of 1981, Prof. Cohen visited Xiamen and expressed in one of his lectures the concern that China might arbitrarily confi scate foreign investment and property. Based on my knowledge of relevant Chinese laws and policies, I raised some opposing ideas against his and followed with my explanations. This aca-demic debate presenting our viewpoints can be found in my article “Should an Absolute Immunity from Nationalization for Foreign Investment Be Enacted in China’s Economic Law?” which was published afterwards in both Chinese and English. This bilingual article was collected in my book CHEN’s Papers on International Economic Law (in two volumes), published by Beijing University Press in 2005, and was later reprinted in the book An CHEN on International Economic Law (in fi ve volumes), published by Fudan University Press in 2008. These two books are compilations of my 30 years’ research in the fi eld of interna-tional economic law.

Photo 2 Prof. CHEN and Prof. Cohen (2004)

Introduction

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Then, with Prof. Cohen’s kind invitation, I went to Harvard Law School to study and lecture between 1981 and 1983. During that time, I read many authori-tative books of international law and international economic law written by prominent American scholars such as Prof. Louis Henkin, Prof. Andreas F. Lowenfeld, and Prof. John H. Jackson and many other fi rsthand documents and records. This experience broadened my insight and provided me with a great deal of fresh knowledge. At the same time, however, I found that these books contained some opinions with a strong sense of colonialism and economic hege-monism refl ecting the US-style double standards rooted in unilateralism and utilitarianism. Such opinions not only went against the just call of reforming the old international economic order (“OIEO”) and establishing the new interna-tional economic order (“NIEO”), but also were against the historical tide of the modern world. I think these opinions are misleading with major defi ciencies.

For this reason, we should not blindly follow and completely accept these Western opinions. Rather, a correct attitude is to contemplate independently and critically in order for us to be able to distinguish right from wrong. By hold-ing such kind of attitude, in my three decades of research and writing, I have always been trying to analyze, distinguish, ascertain, absorb, or reject Western legal theories while steadily taking into account the national situation of China and the position of the weak countries. In addition to “taking the essence while discarding the dross” (取其精華,弃其糟粕) of the Western legal theories, I have raised a series of my own innovative ideas and actively participated in international academic debates, which have helped us to shape our systematic theories on various important legal subjects such as the South–North Confl icts and Cooperation, the establishment of NIEO, the law-making, law- enforcing,

Photo 3 Prof. CHEN, fi rst visit to Harvard (1981)

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law-abiding, and law-reforming of international economic law. Our theories are signifi cantly and substantially different and independent from the existing Western ones. And in turn, we gain the due respect and attention from the inter-national academic community.

6. I noticed that a major part of your 30 years’ research achievements were compiled and published in An CHEN on International Economic Law (in fi ve volumes) in 2008 with as many as 2,626 pages. Which papers do you think can best refl ect your opinions that are independent from the Western scholars? I tried to put forward my independent opinions in each of my papers and here I would like to just list a few, which you might wish to read through:

1. The Ancient-source & Long-stream of Sino-foreign Economic Interfl ows and Their Jurisprudential Principles

2. To Close Again, or to Open Wider: The Sino-U.S. Economic Inter-dependence and the Legal Environment for Foreign Investment in China after Tiananmen

3. The Three Big Rounds of U.S. Unilateralism versus WTO Multilateralism during the Last Decade: A Combined Analysis of the Great 1994 Sovereignty Debate, Section 301 Disputes (1998–2000) and Section 201 Disputes (2002–2003)

4. A Refl ection on the South–South Coalition in the Last Half-Century from the Perspective of International Economic Law-Making: From Bandung, Doha and Cancún to Hong Kong

Photo 4 Prof. CHEN, discussing with Prof. Lowenfeld (2005)

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5. Should the Four ‘Great Safeguards’ in Sino-Foreign BITs Be Hastily Dismantled?—Comments on Critical Provisions concerning Dispute Settlement in Model U.S. and Canadian BITs

6. Distinguishing Two Types of Countries and Properly Granting Differential Reciprocity Treatment: Re-comments on the Four Safeguards in Sino-Foreign BITs Not to Be Hastily and Completely Dismantled

In addition to the said fi ve volumes published in 2008, more papers have been published since then and below are some of them :

7. What should be China’s Strategic Position in the Establishment of New International Economic Order? With Comments on Neo-liberalistic Economic Order, Constitutional Order of the WTO and Economic

Photo 5 An CHEN on international economic law (fi ve volumes) in 2008

Photo 6 An CHEN on international economic law (fi ve volumes) in 2008

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Nationalism’s Disturbance of Globalization, published in The Journal of World Investment & Trade , Vol. 10, No. 3 (2009)

8. A Clear-cut Stand on China’s Strategic Position in the Establishment of New International Economic Order (“NIEO”): With Comments on An Integral and Accurate Comprehension of DENG Xiaoping’s 28-word Foreign Policy, published in Chinese Journal of International Economic Law , Vol. 16, No. 3 (2009)

9. Third Comments on China’s Strategic Position in the Establishment of NIEO: To Where Would the G20 & Its “Path from Pittsburgh” Lead: The Pending Riddle of the New Platform of G20 South-North Cooperation and the Confl ict between Ideas such as “Law-abiding” and “Law-reforming,” published in Journal of International Economic Law (China), Vol. 16, No. 4 (2009)

10. Some Jurisprudential Thoughts upon WTO’s Law-governing, Law-making, Law-enforcing, Law-abiding and Law-reforming, published in The Journal of World Investment & Trade , Vol. 12, No. 2 (2011)

11. On the Source, Essence of “Yellow Peril” Doctrine and Its Latest Hegemony “Variant”—the “China Threat” Doctrine: From the Perspective of Historical Mainstream of Sino-Foreign Economic Interactions and Their Inherent Jurisprudential Principles, published in Modern Law Science, Southwest University of Political Science and Law, No. 6 (2011)

7. In your opinion, what are the advantages and shortcomings of the law- making process of modern international economic law? Since the end of World War II, struggles between the powerful developed States and the weak developing States have been permeating the whole development of the global economy. The former endeavor to maintain the established inter-national economic order (“IEO”) and international economic law (“IEL”) to enhance and extend their vested economic interests, while the latter endeavor to renew the established IEO and IEL to acquire a level playing fi eld and equitable economic rights and interests. In the past 60-odd years, whenever these two groups came to a compromise, the struggles were temporarily paused, but whenever new confl icts arose, the struggles reappear. Such a historical course could be generalized as 6C Rules , namely, Contradiction—Confl ict—Consultation—Compromise—Cooperation—Coordination, and then new Contradiction. We may have seen such spiral-up circles in the development of the NIEO and NIEL. Each new circle moves higher than the former in a spiral-up manner but is not a mere repetition of the former. The result is that the equal and equitable economic rights of the weak countries were gradually obtained, improved, and safeguarded in this process.

From a jurisprudential perspective, the policy-making process of contempo-rary global economic and trade rules is in essence a “law-making” process of IEL. For 60-odd years, three major defects appeared in this process.

First, a few developed countries (such as the G7) often consult and manipulate secretly or bargain half-openly before a policy can be made. Then the issue is handed over to some economic or regional organizations composed of

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one- or two-dozen developed countries (such as OECD or the EU) who will coordinate their respective interest, put forward a common proposal, and set out an overall arrangement. The issue will not be submitted to and discussed in a global arena or organization until and unless the above process is com-pleted. This practice deprives numerous developing countries of their right to know and to participate in the law-making process from the very begin-ning. Yet, due to their lack of information and capacity, the developing coun-tries often can do little to help.

Second, major international economic organizations often adopt unfair and unreasonable voting mechanisms which distribute the voting power among the countries unequally. A typical example is the “weighted voting mecha-nism” which is still arrogantly employed by the IMF and World Bank. Under this mechanism, it is possible for a handful of developed countries to make decisions on important global economic affairs. By their overwhelming majority of voting rights, these countries can have a de facto veto privilege. On the other hand, facing such an unfair and unreasonable mechanism, the developing countries are often entrapped in a dilemma; they either have to accept all such disadvantages to stay in this system or to isolate themselves by quitting the system. Given the current situation of economic globalization and the increased interrelations among the economies, economic sover-eignty and rights of the developing countries will defi nitely be harmed in one way or another.

Third, the United States, as the only superpower, adopts “the superiority of US national interests” and “double standards” as its “national policies” in global economic and trade policy-making processes. Based on its absolute eco-nomic advantage, the United States can not only coordinate among various political groups to control the decision-making process, but it can also neglect its treaty obligations and take actions at its own will even after the decision has been made. 2

In short, the key lies in the severe unfairness in international power alloca-tion in global economic and trade policy-making processes. A direct conse-quence is that the main decision-makers of the IEO and the international economic and trade policies are often constituted by a small group of developed countries, which further causes unfair global wealth distribution. As is well known, the unfair global wealth allocation is the most essential manifestation of the OIEO which still exists. It is also the main undesired consequence of the lack of protection of the economic sovereignty and rights of the developing countries. You can see there is causality between the allocation of power and

2 Peremptory attitudes expressed by the United States in its dealing with Section 301 disputes and Section 201 disputes from the years 1998 to 2004 serve as a typical example. See An CHEN [1] . An updated and extended version was reprinted by South Center in pamphlet form. See South Center [2]. This long article has then been compiled in the book Refi nding Sovereignty in International Law [3]; also compiled in An CHEN on International Economic Law (Vol. 4) , 1725–1807 , Fu-Dan University Press (2008).

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the allocation of wealth. This is the historical and ruthless fact of human soci-ety, which is true in both China and foreign countries, at present and in the past. In light of this, the unfair allocation of power must be reformed to guarantee fair distribution of global wealth. This also explains why so many developing countries have been emphasizing equal rights of all nations in the global eco-nomic and trade policy-making. All in all, the international weak groups’ demand for reforming the unfair allocation of power in global economic and trade policy-making and wealth distribution is in nature a demand for “law-reforming.”

8. What do you think about the relationships among law-making, law-abid-ing, and law-reforming of IEL in WTO rules? [4] Some believe that international law scholars should think from a true lawyer’s perspective and vigorously advocate “law-abiding” rather than indiscreetly talk about the reformation of the existing IEO and IEL since such talks sound more like a political slogan and challenge rather than a real legal endeavor. 3 Such talks, if put into practice, will usually lead to violation of the existing interna-tional law and incur international legal and moral liabilities. This opinion is partially true, yet needs to be thoroughly examined.

Herewith, the dialectical and interactive relationships among law-making, law-abiding, and law-reforming of the existing IEL (including but not restricted to WTO rules) shall be noted. Facing the existing IEL, including various “rules of the game” of international economy and trade, the weak groups certainly cannot deny them, nor can they remake the rules entirely. However, they should not accept these rules in an overall way while ignoring their unfairness and injustice. A correct attitude toward these rules should be to fully review “law-abiding” and “law-reforming” in combination by the criteria of justice and fairness in order to achieve equal rights and interests for the weak groups. The weak groups shall uphold the rules that meet such criteria and stress law-abiding, while for the rules that fail the criteria, these weak groups should reasonably advocate law- reforming. In other words, for each and every rule that reaches the set criteria of justice and fairness, thus satisfying the need to reform the OIEO and to establish the NIEO, the weak groups shall continue to use and reiterate, with law-abiding being emphasized. On the other hand, for each and every rule that transgresses the aforementioned need, law-reforming shall be emphasized, and the weak groups shall argue on a reasonable basis, seeking to reform, abolish, or eradicate it through all possible ways and approaches. Consequently, from a historical perspective, the following facts should be noticed.

3 For example, the authoritative American Prof. A. H. Lowenfeld holds this hegemonic point of view. See Andreas F. Lowenfeld, International Economic Law 412–414 (2002); 492–493 (2nd ed. 2008). For details on the quotations and comments on these pages by the author, see An CHEN [5]. See also Annex I of the present interview-paper.

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First, to demand reform of the established IEO is not merely a political slogan. Actually, it is at the same time a “legal” concept, namely, “law-reforming.” For over 60 years, the international weak group has endeavored to realize this goal. This process is always full of diffi culties, but is still feasible with the fi rm belief and enduring efforts of the weak groups by gradually “excret-ing the old and absorbing the new” or “demolishing the old and creating the new” (吐故纳新,弃旧图新).

Second, as to the obvious unfairness and injustice contained in the current IEL, the developed countries have promised to reform them. But always no acts have been taken due to their economic superiority. It is often seen that these powers sometimes fail to live up to their international obligations. There is an aphorism that reads: “The ‘public law’ always relies on insubstantial rea-sons. The strong is able to enforce their ‘law’ to tie others, while the weak is inevitably wronged and to endure with great patience” (公法乃憑虛理,強

者可執其法以繩人,弱者必不免隱忍受屈也). 4 From a jurisprudential perspective, this aphorism not only generalizes the “law of jungle” in the past but also refl ects its present nowadays. Under the existing IEL, it is cer-tainly misleading to excessively demand the international weak group to abide by all laws unconditionally and absolutely. Instead, the weak group should stand and fi ght, advocate, and appeal for law- reforming, so as to change and eliminate the existing unfair “rules of the game.”

Third, for over 60 years since the end of World War II , the struggle for “law- reforming” and “anti-law-reforming” has experienced continuous ups and downs. A recent example is the WTO Doha Round starting from the end of 2001. This round refl ects the struggle between the law-reforming and anti-law- reforming groups within the current WTO contexts. However, law- reforming promised by the developed countries (particularly in agricultural products’ market access, domestic support, and export subsidy) remains nominal without real progress. By so doing, these countries ate their own words by making use of their superior economic status. 5

4 Guanying Zheng, Stern Warnings in Peace Time Public Law, published by San Wei Tang, (Vol. 1) 42 (1898), [鄭觀應:,光緒24年(1898年)三味堂刊,卷一,第42頁]. Zheng is a renowned thinker in China’s late Qing Dynasty. He penetratingly exposed the excuse on public international law hold by the Western powers to justify their invasion and brutal behaviors in China. 5 An CHEN [6]. This long article has won wide attention in international academic circles. The concluding section of this article was fi rst published under the title South-North Confl icts in a Historical Perspective , in the authoritative South Bulletin , No. 120 (2006). At the request of the Journal’s editor, Jacques Werner, the abovementioned version was rewritten and published under a new title Weak versus Strong at the WTO: The South-South Coalition from Bandung to Hong Kong , in 1 The Geneva Post Quarterly: The Journal of World Affairs 55–107 (April 2006). With the passage of time, this article received growing attention in international academic circles. Its newly updated version was translated into Korean language and published in 9 The Inha Law Journal (2006). Two years later, its re-updated English version was included in the volume edited by Prof. Yong-Shik Lee entitled, Economic Development through World Trade: A Developing World Perspective , 33–65 ( 2008). Now, both the Chinese version and the English version of this

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Fourth, considering that the South is far weaker than the North currently, and the group of strong powers (such as the G7) has maintained a dominant posi-tion for over 30 years in international economic fi elds, the international weak group’s demand for law-reforming may not be accomplished once and for all. But they shall not rest on the current situation and keep silence, nor should they act “ individually.” It is repeatedly proved by practice that the only feasible and effective way is to form South–South Coalitions to mobilize their “collective power” to promote law-reforming steadily and solidly. 6

9. What do you think about the WTO’s law-enforcing body, the DSB? In my opinion, the WTO’s law-enforcing body or judiciary body, the DSB, can-not be simply considered “Bao Qingtian” 7 in the fi eld of international economy. Professor John Jackson, an authoritative American lawyer renowned as the “Father of WTO” in Western academia, proudly announced that DSB had a certain degree of mandatory power, which is one of the major innovations in the history of the development of international economic dispute settlement mech-anisms. The WTO’s dispute settlement system (“DSS”) is often eulogized as the “jewel in its crown” and a “unique, a great achievement.” Professor Jackson emphasizes that “this DSS is unique in international law and institutions, both at present and historically,” and that “the DSS has been described as the most important and most powerful of any international law tribunals, although some observers reserve that primary place to the World Court (International Court of Justice). Even some experienced World Court advocates, however, have been willing to concede that primacy under some criteria to the WTO DSS” [8]. Professor Jackson’s high appraisal of DSS was echoed by many scholars in the West and China.

For 16 years, the DSB as a law-enforcing body has indeed played a signifi -cant role in settling international trade disputes and made signifi cant contribu-tions. However, every coin has two sides. As a matter of fact, the WTO/DSB as a whole has its problems: “congenital defi ciency” and “postnatal imbalance.”

As to the “ congenital defi ciency ” of the WTO/DSB, one has to be aware that the rules enforced by the DSB are not necessarily good laws. As is well known, some of the laws are unfair and unreasonable, some arbitrarily made, some merely nominal promises, and some accessory in bullying the weak. These laws distort the normal and healthy international trade and deteriorate the

long article were compiled in the recent series book, An CHEN on International Economic Law , 479–506 (Vol. 1) and 1808–1852 (Vol. 4), Fudan University Press (2008). 6 An CHEN [7]. See also CHEN [4], at 1–29. 7 “Bao Qingtian” (包青天), with the latter word literarily meaning “blue sky without cloud,” and here to symbolize justice, is the reverent appellation of Chinese people toward Zheng Bao (包拯, 999–1062). Zheng Bao was a high-ranking offi cer in ancient China’s Song Dynasty and was espe-cially famous and beloved for his adjudicative activities and judicial wisdom. He did not fear dig-nitaries and was so just and brave that he even dared to sentence the then Emperor’s son-in-law to death, because the latter had committed a crime of murder.

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situation of the international weak groups. In this aspect, I would like to give two typical examples as follows.

First, the rules of agricultural products’ market access, domestic support, and export subsidy are against the weak groups and are “bad rules” or “evil rules.” The weak groups strongly demand for reforming them in the Doha Round, while the strong powers try to preserve them. Up to now, it is regret-ful that these unfair rules are still in effect in the DSS and are still connived and shielded within the current WTO/DSB regime. 8

Second, as is known, China has a dual economic identity: It is the largest devel-oping country in the world as well as has established the basic system of a market economy. As early as in 2003, Chinese Premier Jiabao Wen had pointed out the basic reasons for China still staying a developing country as follows: “A large population and underdevelopment are the two fundamental national conditions of China. Considering its population, no matter how trivial the problem is, with 1.3 billion multiplied, it will be a very serious one; and no matter how sizable the fi nancial and material sources might be, with 1.3 billion divided, it will become very low in average per capita. All Chinese leaders must keep this in mind at all times” [9].

On September 24, 2010, Jiabao Wen further emphasized in the United Nations General Assembly as follows:

China’s GDP ranks third in the world, whereas its average per capita is as low as 1/10 of that of the developed countries. Chinese economy has been booming for over 30 years, however, its further development is constrained by energy, resource and envi-ronment. Outputs of a number of vital products of China rank top in the world, yet comprehensively, China still stays at the end of the global industry chain. China has already become a big international trade country, but the technology and added value of exporting products are low, and the core technologies largely depend on import. Although some coastal cities have been quite modernized, many places in the middle and western and the vast rural areas are still backward, with 150 million people still living in poverty. Chinese people’s livelihood has been largely improved, while social security system is still distempered, and employment pressure is still huge. Political life and social activities in China have gradually fl ourished, and fundamental rights of citizens have been well protected. However, democracy and legal system has not yet been well established, and problems such as social disparity and corruption still exist. With the modernization in place, China has both advanced and backward areas, novel and old notions, and is facing many unprecedented challenges. China is still at the primary stage of socialism, and is still a developing country. This is our basic national condition and reality. [10]

However, the dual economic identities of China have not been clearly con-fi rmed by the WTO/DSB. Furthermore, under the management of several pow-erful developed countries, China was to some extent forced to reluctantly accept varieties of “disadvantageous articles” at the inception of its accession to the WTO that even exceeded the standards acceptable to developed countries, thus making China frequently subject to unfair treatment. In other words, China had

8 Supra note 5.

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to accept many hidden WTO-plus obligations when acceding to the WTO. The negative impacts of these obligations have begun to emerge. About 6 years ago, a treatise commenting on such articles of China’s Accession Protocol pointed out that nonmarket economy, transitional product-specifi c safeguard measures, special safeguard measures on textiles, and transitional trade review mecha-nism are among the most harmful provisions to China. 9

Article 15 of the Protocol is the nonmarket economy provision providing that the importing WTO members may not use normal methodology in deter-mining subsidy and dumping margins. 10 Such a method excludes the consider-ation of China’s domestic market prices or costs. The nonmarket economy status will last until 2016. This is the main reason that Chinese products have met so many antidumping investigations in the world, especially in the Western countries.

Article 16 of the Protocol deals with the transitional product-specifi c safe-guard mechanism, 11 the “selected safeguard clause” in the GATT time. However, this clause has been declared illegal under the WTO rules because of its speci-fi city and discrimination and its low requirements for taking safeguard mea-sures against Chinese exporting products. This discriminative treatment will be terminated after 12 years have passed from China’s joining the WTO.

The provision on textiles in the Report of the Working Party on the Accession of China is similar. It allows the importing WTO members to impose safeguard measures against textile products from China when the imports cause “market disruption.” They need not even testify that their industry of like products is “really” injured by Chinese imports, which is actually a WTO obligation.

An additional unfair article is the Transitional Review Mechanism in the Protocol. Based on this article, the WTO General Council and its 16 subsidiary bodies will review China’s implementation of the WTO Agreements and other related provisions of the Protocol. It may review China’s trade policy, economic data, even that of government procurement, notwithstanding that China is not a member of the Government Procurement Agreement. Moreover, such review takes place annually until 8 years after China’s accession to WTO.

In brief, China accepted those WTO-plus obligations under some particular circumstances and paid an extra-high cost for its accession to the WTO. China should pay more attention to the negative effects of them in political, diplo-matic, and economic fi elds and also endeavor to seek change and reform of the unfair situations. Indeed, such unfair situation is merely one example which

9 Yongfu Gao [11]. Gao is a senior professor of Law School, Shanghai Institute of Foreign Trade. He is a former associate president of Shanghai WTO Affairs Consultation Centre and a current senior expert. 10 See Protocol on the Accession of the PRC , available at http://www.people.com.cn , (November 25, 2010). See also supra note 10, at 47–56; Weitian Zhao, Interpretations on the Articles of Protocol on the Accession of the PRC (available only in Chinese) 91–98 (2006). Weitian Zhao was a late authoritative expert on GATT/WTO. 11 Supra note 9 at 57–62. See also Weitian Zhao [12].

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other developing countries also suffer. Under such circumstances, if the WTO/DSB makes no distinction regarding whether the laws are good or bad, but rigidly “ensures that the laws must be absolutely observed” and strictly “enforces the laws,” it certainly will not lead to justice, but does the opposite.

As for “postnatal imbalance” of WTO/DSB, the primary fact is that there is precedence showing some specifi c DSB panels’ injustice, incapability, and “politically astute, but legally fl awed ” approach in their practices. In this aspect , I would like to give three typical examples as follows.

The fi rst example is the Section 301 Disputes in which over 30 countries led by the EU challenged the United States during the years 1998–2000. The DSB panel adopted an equivocal attitude and technique, which reprimanded little but helped a lot with the fi nal approval of an unjustifi able chicanery from the respondent (the United States). This was substantially partial to the domi-neering superpower and its notorious Section 301 [13], thus incurring criti-cisms from the public. One such criticism pointed out that “The Panel decision seemed to be a fair ‘political’ decision that pleased both parties, or at least enabled them to save face. However, this panel decision is ‘legally weak’, even though it is not entirely wrong” [14]. “While the Panel Report is politically ‘astute’ , its legal underpinnings are ‘ fl awed’ in some respects and its policy implications for the future of the WTO Dispute Settlement Body generate serious concerns.” 12 In 2003, I made further and detailed comments on this Panel decision in my comprehensive article titled: The Three Big Rounds of U.S. Unilateralism versus WTO Multilateralism During the Last Decade: A Combined Analysis of the Great 1994 Sovereign Debate, Section 301 Disputes (1998–2000) and Section 201 Disputes (2002–2003) . 13

The second example is the US Section 201 Case in which 22 countries and regions led by the EU challenged the United States. The DSB panel and the Appellate Body (“AB”) ruled against the United States. However, though the domineering unilateral “safeguard measures” of the United States had only been implemented for 21 months, lots of benefi ts had been gained by the United States and serious damages had been caused to foreign rivals. Such behavior was neither denounced nor was any due restitution to the injured foreign rivals compelled. 14 Because “benefi ts have been gained at the expense of others without any punishment,” the US president at that time even satisfactorily announced that “these [US] safeguard measures have now achieved their purpose.” “We will continue to pursue [our] economic

12 Chang, S. W. [14]. 13 CHEN , supra note 2; An CHEN [15]. The excerpt from this comprehensive article with com-ments on American authoritative professors L. Henkin and J. Jackson’s views upon contemporary economic sovereignty, See Annex II of the present interview-paper. 14 An CHEN, Third Round of U.S. Unilateralism Versus WTO Multilateralism: Jurisprudential Investigation and Prospect of Section 201 Disputes, 2 China Legal Science (2004). This article has also been compiled in An CHEN [16].

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policies,” as well as “our commitment to enforcing our trade laws” [17]. As to the serious damages incurred to foreign rivals, the eloquent president, pretending to be deaf and dumb, kept absolutely silent without saying even one word of regret, sorry, or apology. Thus, it can be fully seen that the United States had no intention to change or reform its unilateral domineer-ing legislation accused around the world. This has laterally refl ected that the so-called mandatory power of the current WTO/DSB regime which Prof. John Jackson so indulged in elaborating on (如此津津樂道) is not so strong toward the self-willed and hegemony- addicted United States; on the con-trary, it is much limited or even weak.

The third example is the US–FSC Case launched by the EU. It was in the end settled with US “defeat” (fail) under the WTO/DSB mechanism. Before that, however, both parties had been bargaining and fi ghting for more than 8–10 years on export subsidies. 15 A famous WTO expert, Prof. Yuqing Zhang wrote a special monograph to make a full introduction and analysis to the entire case, which is worthy of a careful and thorough study, regarding: How shall we treat the fi nal end of this case which did not come out until 8–10 years? How shall we treat and evaluate the adjudicative effi ciency and the actual effect of WTO/DSB in this case? It seems that we may as well cite one paragraph of relatively objective and honest critique of Prof. John Jackson for reference and supplement: “If disputes drag on for a decade, it comes to a point where there really is no remedy, and the system is clearly not operating effectively.” 16 Pitifully, with respect to the said case, Prof. Jackson has not clearly expressed whether or not he is willing to apply these objec-tive and honest criteria directly and specifi cally to the evaluation of the “mandatory power” of current WTO/DSB regime, which he has indulged in elaborating on. This problem remains to be examined and clarifi ed.

To generalize, in my mind, the “congenital defi ciency” and the “postnatal imbalance” of the current WTO/DSB regime revealed in the aforementioned typical examples, especially the weakness and retard of its mandatory power on domineering behavior of hegemonic country, seem to have showed that this law-enforcing body is far from a “powerful long rope” capable of “taming down and tying up the black dragon,” 17 and even not to mention of becoming a modern “Bao Qingtian” in the contemporary international economic fi elds. In other words, this law-enforcing body, which is eulogized as the “unique, a great achievement with unparalleled effi cacy, or this twinkling ‘jewel in WTO’s crown’” is not always dazzling, but rather dim and dark under occasions when some specifi c DSB panels separately show its connivance in bad laws, its

15 Yuqing Zhang, Preface, Comprehend DSU of WTO by Cases: Comments on US—FSC Export Subsidy Dispute . 16 Jackson [8] at 147. 17 These words are cited from a famous and popular poem written by Chairman Mao: “Now with the powerful long rope holding in hand, when will we tame down and tie up the black dragon?” (今日長缨在手,何時缚住蒼龍?)

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shielding for evil laws, or its political astuteness yet with legal fl aws in face of powers.

It appears that the current regime and rules of this law-enforcing body per se remain to be improved gradually through continuous “law-reforming,” before it can give a real play to its due function of protecting the weak, strengthening the just, and eliminating the evil.

10. How to attain goodness but avoid harmfulness in law-abiding and law- adapting and meanwhile to promote law-reforming in regimes such as the WTO? China has been a member of WTO for almost 10 years. Practicing years have extensively deepened its understanding of the current WTO legal system and its related international regimes. At this point, we ought to review both the credits and shortcomings of this system including the DSS, etc. According to the Marxist epistemology, human beings constantly face problems when adapting to, comprehending, and reforming the world. Over 100 years ago, Marx pointed out incisively that “Heretofore the philosophers have only interpreted the world in various ways—the point, however, is to change it.” 18 This judgment remains correct today. Comprehending the world is the prerequisite of adapting to and reforming it. However, practical activities of human beings should not just aim at comprehending, interpreting, and adapting to the world. A more critical step is to carry out active reform through practices so as to promote healthy and harmonious development of human society.

The WTO has expanded to an organization of 153 members since the GATT period of 1947. According to a recent speech of Director-General Mr. P. Lamy, in the following 10 years, the WTO may host 180 members without diffi culty [18]. Truly, the WTO has a characteristic of “rule-orientation” rather than “power-ori-entation.” Does this mean the WTO rules will automatically, smoothly, and unconditionally be followed? The answer is self-evident. As discussed before, the “6C Rule” permeates in the law-making process of IEL, and the DSB is by no means “Bao Qingtian,” not to mention the large number of exceptions and vague-ness in many WTO rules. All members try to interpret these rules for their own benefi ts. Numerous confl icts among different (and different kinds of) members appear, while any so-called comity or modesty would carry advantages to some members but incur disadvantages or even serious damages to some other mem-bers. This is the basic cognitive premise for the discussion of law-making, law-abiding, law-enforcing, and necessary law- reforming of WTO’s rules.

Considering that the current WTO system has been designed mainly by developed countries, developing countries including China should research how to adapt to, comprehend, and reform it. Because they barely had any say in the past law-making process, they were also quite weak individually and col-lectively. As a consequence, the attitudes and experience of developing coun-tries toward the current WTO regime are in different stages.

18 See 1 Selections of Marx and Engels 5 (People’s Press, 1995).

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First, when joining the WTO, developing countries had to fi rstly adapt to and abide by the existing WTO rules, so as to further understand these rules in the practices of adapting and abiding. At this point, they are actually entrapped in a dilemma: On the one hand, they realize the importance of joining the globalization process to develop; on the other hand, they face the existing WTO “rules of the game” designed mainly by developed countries which are unfamiliar in many aspects. They are even unsure of the possible practical infl uence these rules would bring to them. Joining the WTO is one of such examples; it is more or less revealed that developing countries are somewhat “out of choice” and “helpless.” Of course, joining the WTO is the fi rst step for them to gain more say in the decision-making of international economic affairs in the future.

Second, during the law-adapting and law-abiding process, developing countries shall not only endeavor to acquire profi ciency in various “rules of the game” to attain the goodness and avoid the harmfulness, they also need to distin-guish right from wrong, good from evil, and contemplate the reforming direction on the stand of the common rights and interests of international weak groups. In fact, after their accession to the WTO, developing countries have indeed gained some obvious improvements and strengthened them-selves up through their own efforts. Mr. Lamy pointed out at the occasion of the 10th anniversary of the World Trade Institute in Bern that “developing countries’ share of world trade has grown from a third to over half in just 15 years—and China has just passed Japan as the world’s second biggest national economy, and Germany as the world's top exporter.” 19 This vividly illustrated the good side of the WTO regime for developing countries. However, developing countries should also clearly see and remember the varieties of aforesaid “disadvantageous clauses” and unfair treatments unreasonably imposed on them and set within the WTO regime, so as to cor-respondingly design their coping strategy.

Third, with regard to the obviously unfair rules in the WTO regime which could harm the common rights and interests of international weak groups, devel-oping countries shall dare to voice demands for law-reforming with suffi -cient reasons. They shall unswervingly fi ght for law-reforming, maintenance, and promotion of a fair playing fi eld and interests for international weak groups, through South–South Coalition and agglomeration of their power. It is justifi ed for the developing countries to request reform of some unfair and unreasonable rules because developed countries have taken advantages of developing countries’ weakness, insuffi cient participation, and lack of expe-rience, to broaden their burdens. Thus, there is a lack of legitimacy and jus-tice for weak group members to absolutely abide by these unfair and unreasonable WTO rules. Besides, in order to attract developing countries to join the WTO or to have them concede in the fi elds such as intellectual prop-erty rights, developed countries had made promises in cutting their domestic

19 Lamy [18].

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subsidies to agricultural products. Regretfully, at the present time, many of such promises are still on the paper and just like some rubber checks. When developing countries discover this, they surely have the right to demand reform of these rules.

Mr. Lamy has noticed that “The US, the EU and Japan remain key players but they are no longer dominant. Fast-emerging powers, like China, India and Brazil, play a role that was unimaginable even 20 years ago—while smaller developing countries naturally want a say in a system in which they have a growing stake.” 20 Within the WTO and even the whole global economic domain, the balance of power is changing profoundly. Developing countries have formed an important component and positive force in WTO, whose active participation in the WTO rule-making is not only important to the maintenance of their own interests but also to pushing the WTO rules toward a more impartial, balanced, and reasonable direction. Although individual power of the developing countries is still weak, their collective power has been enhanced. Thus, it is possible for developing countries to voice their independent proposals. They should protect their common rights and interests by strengthening and deepening the South–South Coalition.

To sum up, it is important to probe into WTO law-making, law-enforcing, law-abiding, and law-reforming so as to warn people, especially those from international weak groups, to promote the “establishment, enforcement, observance, and reformation” of the WTO rules to advance along with time. It is fair to say that the WTO has opened an important page in the process of realizing “rule of law” of international economic relations. However, it is undoubtedly a historical “long march” of international community before the fi nal and actual fulfi llment of this ambition. Such an aim cannot be achieved without the long-standing joint efforts of the international community. At the present stage, it is of most importance for developing countries to deepen their understanding of the existing WTO rules in law-adapting and law- abiding so as to attain the goodness and avoid the harmfulness. It is also of critical importance for them to promote “law-reforming” through South–South Coalition to obtain and protect their own equitable economic rights and inter-ests. Only by these approaches can international weak groups promote the establishment of a fair international economic legal system, achieve “rule of law” in the WTO, etc., and boost the joint prosperity of global economy.

11. What do you think about the path for weak groups to promote law- reforming of IEO, IEL, and WTO? Surely, the path for weak groups to promote law-reforming of IEO, IEL, and WTO is inevitably very rugged and tough. Yet, it is also sure that this path has a bright future. Weak groups all have suffered colonial or semicolonial domination and depredations in modern history. Although they won independence after World War II, most of them are still poor and weak both

20 Id.

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individually and collectively. As the South is far weaker than the North, and given the established hegemonic structure and the “anti-law-reforming” resistance from the latter, it is not easy for the South to demand “law-reforming.” However, since the end of World War II, with the weak groups consciously carrying out the South–South Coalition and their unswerving collective campaign, law- reforming has been steadily advanced from a macroscopic perspective though diffi culties remain. 21

The 60-odd years’ history of “law-making, law-abiding, law-reforming, anti-law-reforming, and fi nally gradual law-reforming” within the GATT/WTO regime might serve as a typical example. 22 This history shows that the South–North Contradiction and South–North interdependence still coexist. The escalation of economic globalization and the South–North gap always stimulate or deepen the South–North Contradictions and Confl ict, but they also intensify the degree of the South–North interdependence. Complementariness in economies and intensifi ed interdependence caused by intersection of economic interests predetermine that international hegemonists have no possibility of opposing the developing countries to the end or cutting them out of the economic interchange.

The international hegemonists after weighing the advantages and disadvan-tages will make certain concessions and compromises when dealing with the legitimate requests of the weak groups representing over 80 % of the world’s population. The recurrent deadlocks in the South–North Confl ict will, to a cer-tain extent, be resolved through dialogue and consultation, by seeking the con-vergence of the adversaries, reaching appropriate agreement, and thus substituting the mutually destructive behavior of both sides with a win-win result for both sides. Even though the new cooperation situation may occasion-ally be weakened or undermined by the new South–North Contradictions and Confl ict, the contemporary trend of the economic globalization and the fact of South–North interdependence could revitalize the South–North Cooperation . In this sense, South–North Cooperation might suffer from “disease” and some-times even suffer from severe symptoms, but will in no case be “incurable and die.” The spiral recurrence of the “6C Track” is the historical record and factual proof in this respect. Therefore, the pessimistic attitude toward the dimness of the future of the WTO or the view of its quick collapse—just the same as the opposite position that “the WTO would travel along a smooth path as the South wins and the North loses”—is defi cient. 23

All in all, one could understand vicissitudes by taking history as a warning. The 60-odd years’ historical course of “law-making, law-abiding, law- reforming, anti-law-reforming, and fi nally gradual law-reforming ” within the GATT/WTO regime has at least showed the following points.

21 CHEN, supra note 5. 22 For details, see An CHEN [19]. 23 CHEN, supra note 5.

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First, some extremely unreasonable and obviously unfair old norms and “rules of the game” for the GATT/WTO regime are gradually abandoned and renewed with the ceaseless push of international law-reforming power for over 60 years, because these unfair old norms and rules are against and breaching proper and equitable rights and interests of billions of people in weak States, and because they are not in accordance with and even against the contemporary historical trend.

Second, the law-reforming process of the unfair old legal norms and original “rules of the game” for the GATT/WTO regime, although it has been facing constant diffi culties and obstacles, yet from a macroscopic perspective, is advancing with a rather bright prospect, because it accords with proper rights and interests of billions of people of weak States and the contempo-rary historical trend.

Third, the accumulative achievements on law-reforming of the unfair old legal norms and original “rules of the game” for the GATT/WTO regime must be counted on and attributed to a long-term and united campaign of international weak States themselves, rather than bestowals from international powers. For the international weak States, the aphorism contained in The Internationale by Eugène Edine Pottier is still instructive, which reads “No Savior from on high delivers; No trust have we in prince or peer; Our own right hand the chains must shiver; Chains of hatred, greed and fear.”

Fourth, the former three points not only apply to the law-reforming process of the unfair old legal norms and original “rules of the game” for the GATT/WTO regime; with enough deliberation and retrospection, the international weak States can also apply them to scientifi cally examining and dissecting all the unfair contemporary international economic legal norms and the macroscopic process of continuously reforming and renewing any unfair IEO and IEL.

12. Professor CHEN, during the last three decades, you have devoted yourself to establishing an academic fl ag with Chinese characteristics different and independent from prevailing Western theories in the fi eld of international economic law. You have been considered as a fl ag-holder Chinese scholar advocating reform of international economic law, renowned as a truly leading scholar of international economic law in China as well as all over the world. Your personal experience would offer a guiding compass for young scholars of other Asian countries who are contemplating pursuing a career in this fi eld. In retrospect, what was the most diffi cult challenge and most memorable achievement for you in your academic career as a scholar in this new fi eld of law? I would say I have never been very talented but mediocre. For well-known rea-sons, I have spent much of my life in tough periods. It was not until the opening and reform of China initiated by Xiaoping Deng that I could get a good chance. In 1981, when I was aged 52, I went abroad to study and research international economic law. For this reason, People’s Daily once described me in a special report,

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“Just started to race at the age of spurt” (在應沖刺的年齡才起跑). Despite some achievements I have made in the three decades of my study, I am humble and dare not to “offer a guiding compass” for the young scholars of other Asian countries.

Looking back, I often regret my delay in studying new legal knowledge. However, I always adhere to the motto of “realizing the distance, never content-ing with lagging, rousing to catch up, overcoming shortage by diligence” (承認

差距,不甘落後,急起直追,以勤補拙). In the meantime, I hold an attitude of “taking and digesting, then absorbing and/or discarding, and then criticizing and creating” toward Western theories. I always try to absorb their essence but discard their dross and am never afraid of raising my own independent and convincing opinions and often participate in international academic debates. 24 As legal scholars, particularly Asian ones, we must bear in mind that our coun-tries have long been invaded and bullied by the Western powers and Japan in history and suffered from colonialism and economic hegemonism. We need to bravely pursue natural justice and international social equity and defend our countries with the correct theories and knowledge of international economic law that we have acquired, so as to defend equality in the international community and protect the equitable rights of weak countries.

These few words are actually some of my personal experiences on my study of international economic law, and I wish to share them to encourage young Asian scholars and colleagues.

24 For example, debating with Western authoritative professors such as A. F. Lowenfeld, L. Henkin, J. H. Jackson, etc. See Annex I and Annex II of the present interview-paper.

Photo 7 Prof. CHEN’s calligraphy and poem in Chinese (2005)

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蹉跎半生,韶華虛擲,青山滿目,夕霞天際。

老牛破車,一拉到底,餘熱未盡,不息奮蹄。

Regretfully it is so late in a daytime/Half of a lifetime had been spent in vain Thanks to the setting sun so brightly shines/The old ox insists in carrying a broken cart to the end Never stop in speeding up its hoof-pace in time/As long as its surplus energy still remains

Interview by Eric Yong Joong Lee under the auspices of Jaemin Lee The interviewer would thank Dr. Manjiao Chi as well as Ms. Carol Chen for their

kind help in preparing the present interview-paper.

Annex I of the Present Interview-Paper

(As a supplement to the supra footnote 4 of the interview-paper)

Some Fragmentary Comments on Prof. A. F. Lowenfeld’s Views upon IEO and IEL 25

An CHEN

During 1975–1979, Prof. Lowenfeld had sequentially published six volumes of teaching materials, composing a series under the title of “International Economic Law,” which have undoubtedly made an enormous contribution to the preliminary formation of the disciplinary system of modern international economic law.

After a comprehensive survey on basic arguments of these books, however, obvi-ous and fundamental limits can be discerned as follows: In the process of analyzing and judging various legal cruxes of international economic relations, the domestic legislations of the United States are regarded as the ultimate criteria, and the practi-cal interests of US capitalists are targeted as the supreme aim. With regard to the strong demand and proper behavior to defend their economic sovereignty of the numerous weak nations, such as to reinforce domestic legal jurisdiction and restric-tions vis-à-vis the transnational corporations and foreigners within border, they either held a vague attitude or, appearing to be fair and just, actually took sides with the United States.

In the early 1970s, for example, in order to maintain national economic sover-eignty and to develop national economics, the Chilean government once adopted legal measures to reinforce restrictions vis-à-vis the domestic foreign-funded enter-prises involved in economic arteries, by gradual transformation of the shares and management to Chilean nationals, or by gradual nationalization, with appropriate compensation paid to the foreign investors. The International Telephone and Telegraph Corporation (ITT), an enormous American transnational corporation,

25 Excerpt from An CHEN, On the Marginality, Comprehensiveness and Independence of International Economic Law Discipline , An CHEN [20].

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tried almost everything to guard its vested benefi ts in Chile. It went as far as to actively appropriate a million dollars as “donation,” to closely assist the CIA in the conspiracy to interfere in internal affairs of Chile and even to secretly send agents into Chile, conducting political bribery, instigating strikes and riots, and trying to overturn the legitimate governmental authorities of Chile. After these confi dential affairs failed and were exposed later on, they were much denounced by the interna-tional public opinion and were soon becoming a worldwide scandal. Most righteous and impartial personages within the United States also expressed their strong con-demnations on these notorious matters. Confronting such cardinal issues of right and wrong, however, Prof. Lowenfeld regrettably claimed in a preface of a prevailing book that:

The present volume neither praises nor condemns ITT – or indeed the multinational corpo-ration generally, and it accepts neither the leftist nor the rightist interpretation of events in Chile. This is so not because of any abstract faith that “truth must lie somewhere in the middle,” but because of a conscious effort to do here what law teachers do as a matter of course in other areas – to present the material as objectively as possible. [21]

Nevertheless, as to the various illegal acts by ITT in Chile, Prof. Lowenfeld made a deliberate misinterpretation and a brazen defense by citing the arguments in the Award, which reads:

A different panel of the American Arbitration Association also found in favor of the claim-ant, dismissing as not forbidden by the contract of guaranty evidence of ITT’s efforts in Chile and in the United States to prevent the election of President Allende or to bring pres-sure looking to his downfall. 26

The meaning among these lines, according to Prof. Lowenfeld, is obviously to suggest that such brutal illegal acts of interfering in internal affairs of the host State should not be inadvisably investigated, or would be excusably extenuated, as long as no forbidden terms are explicitly stipulated in the contract. His “objectivity” in such a stand may be seen as a small segment of a whole.

It shall be particularly pointed out that, up to this day, in his globally prevalent one-volume teaching material with the title International Economic Law , which was published in 2002 and revised and republished in 2008, Prof. Lowenfeld had consistently stuck to his American position. The global just proposals and jurispru-dential opinions—such as to reform OIEO, to establish NIEO, to stipulate new norms of IEL, and to maintain and respect the economic sovereignty and economic legislations of each weak nation—strongly advocated by the developing countries who constitute 80 % of the world’s population, were either ignored, or disparaged, or negated. For example, the Charter of the Rights and Duties of States, which was passed with an overwhelming majority in the General Assembly of United Nations in 1974, has won widespread identifi cation of the international society and has already formed opinio juris through two to three decades of practice. Notwithstanding this fact, in Lowenfeld’s globally prevalent teaching material, the

26 Id . at 170(FN d). As to the details of the case, see An CHEN [22]; see also , An CHEN [23]. See also An CHEN [24].

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Charter is constantly deemed as heterodoxy and “departure from the traditional international law,” 27 thus with no legally mandatory force. It reads in the book:

Viewed more than a quarter century later, the Charter of the Rights and Duties of States seems less signifi cant than it appeared at the time. If there was indeed an effort to divorce international investment from international law, that effort did not succeed, though appeals to ‘sovereignty’ and other echoes of the debates of the 1960s and 1970s continued to be heard in the United Nations and other international fora. …Notwithstanding the statements of several of its proponents designed to endow the New International Economic Order with the characteristics of law and to equate the resolutions with legislation, the challenge appeared essentially political . (emphasis added)

The United States and other home countries of multinational corporations rejected the challenge by the developing states, refused to agree to any change in the ‘traditional principles’, and denied that they had been replaced or modifi ed in customary law by State practice (as contrasted with resolutions in the United Nations). The capital-exporting States took the position that the traditional requirements are solidly based both on the ‘moral rights’ of property owners and on the needs of an effective international system. Moreover, they argued, whatever objections might be made to the traditional rules as applied to investments established in the colonial era , the traditional rules should clearly apply to arrangements made between investors and independent governments negotiated on a commercial basis. 28

Words in the above paragraphs are rather thought provoking. With a careful consideration, such following issues could be raised:

1. The Charter of the Rights and Duties of States, which was passed with an over-whelming majority in the United Nations General Assembly in 1974, refl ects the common national will and the opinio juris communis of the overwhelming majority of members of contemporary international society. Thus, it accords most with the principle of democracy that the minority shall be subordinate to the majority, and it embodies most of the principle of human rights (including sovereignty and the right to development) that safeguards billions of weak peoples’ human rights of the international society. The United States has always been praising itself as the “democratic model of the world” and “guardian for human rights in the world” and is mouthful of humanity, justice, and morality. Then, vis-à-vis the critical issue on the human rights (sovereignty and the right to development) of international weak groups, how would such a country play fast and loose, or even totally betray and discard the principle of democracy and that of human rights, which it consistently holds as the highest criteria?

2. After the adoption of the Charter, “more than a quarter century later,” toward the global opinio juris and legal idea that have already formed through decades of practice by the international society, how would such a country go so far as to merely turn a blind eye and a deaf ear and still defi ne to be “essentially political”?

27 Lowenfeld, supra note 3, at 491 (2nd ed., 2008). 28 Lowenfeld, supra note 3 at 412–414 (2002); 492–493 (2nd ed. 2008). The paragraph is adapted from a paragraph in the Restatement (Third) of Foreign Relations Law, n. 49, §712, Reporters’ Note 1 (Status of International Law on Expropriation).

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Why could not the Charter be defi ned legal and become legally bound norms of conduct?

3. For the last 40 years ever since the 1960s, as “appeals to sovereignty and other echoes” from global weak groups in the United Nations and other international fora have been lasting and “continued to be heard,” how would the number one country in the world, who regards “to lead the world” and to guide the future direction of the world as its own responsibility, stuff its ears and refuse to listen or act as if it had not heard?

4. How would the United States, which praises itself as pioneer of the era, be always preoccupied with and unable to part from the out-of-date , traditional international legal norms and the colonial moral concept , which were estab-lished i n the colonial era ? And vis-à-vis the newly formed international legal norms which refl ect the new time spirit of the twenty-fi rst century, how would such a country be so incongruous, disdainful, and even hostile to these up-to- date norms?

For every unselfi sh, magnanimous, and impartial law scholar, the above ques-tions are all seemingly worthy to be deliberated, doubted, and compared, and these questions are also not too diffi cult to be dissected, distinguished from right and wrong, and chosen between acceptance and rejection.

Annex II of the Present Interview-Paper

(As a supplement to the supra footnote 14 of the interview-paper)

Some Fragmentary Comments on L. Henkin and J.H. Jackson’s Views Regarding Contemporary Economic Sovereignty 29

An CHEN

The fi erce rise, fall, and reemergence of the debates, which revolved around the restriction and anti-restriction on economic sovereignty from 1994 to 2003, provide signifi cant information worthy of serious research by the international community, especially small and weak nations. Such nations should analyze and inquire about these debates so as to draw some enlightenment.

The implications of the debates for developing countries, which have occurred over the span of 10 years, are several as follows:

First , as economic globalization accelerates, the offensive and defensive war of eco-nomic sovereignty has not calmed down; it continues and sometimes becomes rather fi erce. Therefore, the developing countries must strengthen their sense of

29 Excerpt from An CHEN, The Three Big Rounds of U.S. Unilateralism versus WTO Multilateralism during the Last Decade:… , An CHEN on International Economic Law 1799–1805 (Vol. 4), Fu-Dan University Press (2008).

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crises/risks to avoid unconscious acceptance of the theories of obsolescence, rel-egation, weakening, or dilution of economic sovereignty (as Prof. Henkin advocates).

The main characteristic of this offensive and defensive war is that the most powerful nation is striving to defend its vested economic hegemony, to weaken further the economic sovereignty of those less powerful nations, and to damage the hard- earned economic sovereignty of weak nations. The international hegemonist has been consistently applying a double standard (as Prof. Jackson advocates) to the issue of economic sovereignty, that is, regarding its own economic sovereignty and actually economic hegemony as a “holy god,” while treating that of weak and small nations as a “small straw.” Under such international circumstances, the Third World should never be away with the “S” word in current time . They must consciously insist their independent sovereignty, so as to separately and/or jointly fi ght against the political and economic hegemony, when the political and economic hegemony still exist. (emphasis added)

Second , the international allocation of decision-making power in global economic affairs is an important part of the offensive and defensive wars on economic sov-ereignty. Therefore, the developing countries should strive to acquire an equita-ble portion of decision-making power in the international arena.

The equity and rationality of the international allocation of decision-making power in world economic affairs is decisive as to whether a weak nation’s economic sovereignty can obtain the protection it deserves. Further, it determines whether the international allocation of world wealth is reasonable. To change the severe inequity in the international allocation of global wealth, the protection of the weak nations’ sovereignty should be strengthened. For this purpose, reforma-tions should be conducted on the source of the severe inequity malpractice in the international allocation of decision-making power in world economic affairs.

As noted above, Prof. Jackson, when reviewing and concluding “The Great 1994 Sovereignty Debate,” emphasized repeatedly that the core and essence of the debate was about the allocation of power, the appropriate allocation of the decision- making power in international affairs between the US government and international institutions. This insight touched the essence of the issue and was on point. Perhaps confi ned by his social status and position, Prof. Jackson was unable or did not dare to further expose the gigantic inequity of the current allo-cation of the decision-making power in international affairs between the super-power and the majority of developing countries.

The facts attest that, in the allocation system of decision-making power in interna-tional economic affairs, the United States has acquired a portion far in excess of what it deserves. During “The Great 1994 Sovereignty Debate,” the arguments of the “Sovereignty Confi dence Group” and the “Sovereignty Anxiety Group” seem contradictory, even though, in essence, they share a common fundamental starting point, that is, grasping tightly a super-portion of decision-making power in international affairs without making any concessions, while endeavoring to seize the small portion of the decision-making power that rests on other’s plates to satisfy their own voracious appetite.

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Third , the economic sovereignty of a country lies in its autonomy power in all its domestic and foreign economic affairs. In the new circumstance of economic globalization, the developing countries should particularly dare to insist on and be good at maneuvering their economic sovereignty. In the tide of accelerated economic globalization, what the developing countries face is a situation in which chances and crises coexist. To make use of the chances, the developing countries must grasp tightly their economic sovereignty. Only by using it as major leverage can developing countries conduct necessary guidance, organiza-tion, and management on various internal and foreign economic affairs. To prevent and defend crises, the developing countries should rely on their tightly grasped economic sovereignty, apply it as the main defense, and take all neces-sary and effective measures to disintegrate and eliminate any crisis possible.

There is no such thing as a free lunch in the world. Sacrifi ce must be paid to take advantage of the chances and to make use of foreign economic resources to serve a nation’s own economic construction. But the sacrifi ce is limited to an appropri-ate degree of self-restraint on certain economic power and economic interests and on the basis of complete independence and autonomy. The appropriate degree of self-restraint may be found by the following: (1) persisting on the bal-ance between obligation and right and resisting harsh foreign requirements—we should fl atly reject those extra requirements that would generate a severe nega-tive impact or deteriorate a nation’s security and social stability, without making any concession 30 ; (2) making an overall assessment of the advantages and disad-vantages, gains and losses, on the autonomy basis, then striving for more advan-tages than disadvantages, more gains than losses; (3) being vigilant in peace time and strengthening our sense of anxiety in assessing, anticipating, and taking pre-cautions earlier due to the possible risks accompanying such chances, such as the re-manipulation of the national economy vein by foreign countries, the loss of control and confusion of the fi nance and monetary order, the drain of national property, and the taxation source of national treasury; (4) being prudent enough and taking deep considerations without making promises too rashly as to those concessions and prices with too high a risk with less benefi ts; and, fi nally, (5) making arrangements before and after making promises to enhance the ability to defend and eliminate crisis. Only then can nations, as steadfast as a midstream rock, retain their autonomy in their economy under the lash of the economic globalization tide.

30 For example, in the “single package” negotiation on China’s accession to the WTO in the begin-ning of 2001, some developed country members put forward harsh requirements on China’s adjust-ment in its agricultural policy, which were denied by the Chinese delegation. The head of the Chinese delegation and its chief negotiation representative, Yongtu Long, emphasized: “with regard to the agriculture, China has a population of 900 million engaging in agriculture industry, so keeping the stability of agriculture is of great importance to the social stability and economic development of China…. After its accession to the WTO, the Chinese government needs to reserve those measures in support of agriculture which are consistent with the WTO. The interest of the 900 million agricultural population will forever be the fi rst consideration of us.” See Fifteenth Session of WTO Chinese Working Group Finished , People’s Daily, January 19, 2001.

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Fourth , any mistake in “theory” is sure to lead to blindness in “practice” and paying a great price. After an overall survey of the current contradiction between the South and the North, it is obviously “inadvisable” for the weak and small nations to recognize or to adopt the theories of sovereignty weakening or sovereignty dilution. With accelerated economic globalization, various theories of diluting or weakening the concept of sovereignty will appear quietly on some occasions, which seem to be novel and fashionable ideas. Some less worldly people with a kind heart, who have not tasted the bitterness of a small or weak nation, may be perplexed by certain specious arguments, evidence, or false impressions and thus become unconsciously the echoes of the fashionable theories. However, consid-ering the reality that contemporary economic hegemony is performing arbitrari-ness from time to time, and combining with the fact that those theories of the obsolete and relegation of sovereignty were created right from the hegemonic country and have been advocated as a strong theoretical support of economic hegemony, it should be a sudden wake-up (当头棒喝!) for many people; the development direction of the sovereignty dilution and weakening theories is destined to the sovereignty obsolete and relegation theories. This destination is never the welfare of the small and weak nations. Rather, it is a theoretical trap and people with good intention cannot foresee its results.

If people can keep calm and strengthen their observation and comparison of the current international reality, they will naturally accept the right judgment in con-formity with reality: In the situation of accelerated economic globalization, hegemonism and power politics still exist; thus, the tasks of the developing countries to safeguard their national sovereignty, security, and interests are still arduous. 31

Consider for a moment China’s place in this discussion. In the offensive and defen-sive wars in the fi eld of political and economic sovereignty during the period of the twentieth century, China, being the biggest developing country, had suffered severe historical tortures of national oppression, exploitation, and humiliation, been trampled by powers, and then, it experienced great historical exultation when eventually achieving autonomy on politics and economy after more than a century’s striving to restore its national dignity. Now , at the beginning of the twenty-fi rst century, in the new situation of accelerated economic globalization, China is, as well as a great deal of other developing countries, once again con-fronted with the offensive and defensive wars of economic sovereignty. It is nec-essary at this moment to review the eager exhortation left by Mr. Xiaoping Deng that Chinese people cherish their friendship and cooperation with other countries and their people, but they cherish more their rights of autonomy acquired through long periods of struggle . Any country should not count on China to be their dependency and should not expect China to swallow the bitter fruits that may impair their country’s interests. 32

31 See Zemin Jiang [25]. 32 See Xiaoping Deng, The Opening Ceremony Remarks on the Twelfth Plenary Session of the CCP , The Selected Works of Deng Xiaoping 372 (1983).

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Book Review: An CHEN’s Series of International Economic Law (by Prof. Huiping Chen) 33

This is a series book of fi ve volumes written by Prof. An CHEN, published by Fudan University Press in 2008 (2,626 pages with 3.1 million Chinese characters). As a Chinese saying goes “The writing mirrors the writer” (or “One’s writing refl ects his personality,” “文如其人”), I would like to provide a brief retrospect of Prof. CHEN before commenting on his articles.

Prof. An CHEN is a highly renowned international academic lawyer. He is a man of exceptional brilliance and principle with clear, broad, and rigorous thinking and wisdom. He has a profound understanding of the importance of international law.

He began studying law at Xiamen University in 1946 at the age of 17. Unfortunately, due to historical reasons in China, his legal studies had been long interrupted until 1980 when the Law Department of Xiamen University was rees-tablished. At that time he was already in his 50s. He had keen insight to fi nd that China not only needed to establish its domestic legal regime but also needed inter-national law, especially international economic law (IEL), when China opened up to the world. Professor CHEN caught such a need and decided to focus on IEL. At the same time, however, there were few modern legal references, not to mention IEL literatures, in China. During the spring of 1981, he occasionally met and debated with Prof. Jerome Cohen, law professor and associate dean of Harvard Law School at that time, and was then invited to Harvard Law School to continue his legal stud-ies. Afterward, he took all opportunities to bring back relevant materials including books and articles in English whenever he traveled abroad for conferences and vis-its. The series works of An CHEN on International Economic Law are the main products of his research and refl ect his patriotism and his historical responsibility.

An CHEN on International Economic Law consists of fi ve volumes with 3.1 mil-lion Chinese characters. His works cover eight subjects including general principles of IEL, international investment law, international trade law, Taiwan-related eco-nomic law, education of international law, English articles on IEL, and news reports about him and his academic viewpoints, comments on his works, as well as letters and correspondences. The fi ve volumes cover his books and articles written and published in the past thirty years and cover both theoretical and practical aspects of almost all areas of IEL. These highly comprehensive works were magnifi cent pieces of writing displaying great momentum and broad perspective. More importantly, the volumes in the whole series mutually echo and are consistent with each other in academic thoughts.

Covering everything contained in the fi ve volumes of his works within the pur-view of this short book review would not be an easy task; I would like to focus on

33 This book review was fi rst published in The Journal of East Asia and International Law , Vol. 4, No. 2, Autumn 2011, pp. 533–536.

Huiping Chen is now professor of international law at Xiamen University. She was a Ph.D. candidate of international economic law under the supervision of Prof. An CHEN during 1994–1999.

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the following key points which show his insights and particular approach to international economic law.

First, the fi ve volumes show clearly and consistently Prof. CHEN’s academic thoughts and pursuits. Professor CHEN was born in the more traditional days of China and fully understands the oppressed and weak groups of people in the world. He has a profound understanding of the importance of international law and the rule of law in the whole world and believes that law should pursue fair-ness, justice, and equity. As a result, he eventually became a defender of liberty and equity through the use of IEL. His academic thoughts and pursuits can be summarized as “Reward one’s home country with knowledge and assist the world weaks with the same” (知识报国、兼济天下).

Second, Prof. CHEN employs the particular Third World and Asian approach in his research and writing. Contemporary IEL was initially created by developed countries and scholars with the vestige of colonialism, imperialism, expansion-ism, and hegemony. Professor CHEN learned from Western scholarship but is not constrained by its ideas and does not accept them as a whole. On the contrary, he analyzes them, absorbs the essence, and abandons the dross from the perspec-tives of China, Asia, and the Third World. He also applies the favorable general principles of IEL to the contemporary reality of China and the Third World for their rights and interests. In addition, he dares to speak out for the hundreds of millions of people from the Third World by relying on justice and equity, the essence of IEL. Many of his papers have been published in leading international journals. Although he is a friend of Prof. Andreas Lowenfeld, Prof. John Jackson, and Prof. Jerome Cohen, he challenges some of their ideas which he perceives as inconsistent with the interests of the Third World and raises his own independent opinions. I do believe, being a scholar for the Third World people and from the Third World approach, Prof. CHEN can be placed on par with Prof. R. P. Anand from India and Prof. M. Sornarajah from the National University of Singapore.

Third, Prof. CHEN provides a detailed analysis and makes a valuable contribution to the jurisprudential principles of IEL and the establishment of a new interna-tional economic order (NIEO). He believes that economic sovereignty should be the key general principle of IEL. He thus challenges the theories of “sovereignty obsolete,” “sovereignty dilution,” and “sovereignty discarding” advocated by the United States in its foreign political and economic, hegemonic policies toward developing countries and has written a famous article in English, “The Three Big Rounds of U.S. Unilateralism versus WTO Multilateralism.” Another general principle of IEL in which he believes is the principle of mutual and equitable benefi t. He gives more weight to equity than he does to equality. In some specifi c situations or conditions, superfi cial equality is actually inequitable, and vice versa, superfi cial inequality is actually equitable. He uses the generalized prefer-ential, nonreciprocal, and nondiscriminatory treatment to developing countries as an example of superfi cial inequality but actual equity.

Prof. CHEN strongly advocates the establishment of NIEO and seeks appropriate approaches to it. He summarizes the track of the struggles between the South and the North as to the development of IEL as the spiral-up “6C Rule”

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(Contradiction → Confl ict → Consultation → Compromise → Cooperation → Coordination → new Contradiction 矛盾 → 冲突 → 磋商 → 妥协 → 合作

→ 协调 → 新的矛盾), which shows the evolutionary ascent that drives the international economic order and relevant rules to a new level and development phase. The spiral-up “6C Rule” greatly encourages the Third World people to continue to struggle for NIEO even though it is in temporary low tide. Moreover, he considers the South–South Coalition as the only way to NIEO and thus encourages the Third World people to work together closely.

Fourth, Prof. CHEN is an illustrative embodiment of his own academic thought of “Reward one’s home country with knowledge.” He has profound research and insights into international investment treaties and poses suggestions on how to draw on the advantages and avoid disadvantages of the treaties from China’s perspective. In addition to publishing several important articles, he also submit-ted research reports in this regard to the Chinese government and agencies for their decision-making and legislation. His idea of distinguishing two types of countries and properly granting differential reciprocity treatment is treated as a good suggestion for China in signing bilateral investment treaties.

Fifth, Prof. CHEN is not only an academic scholar but also an eloquent lawyer on international arbitration. He is the arbitrator designated by the Chinese govern-ment to the ICSID under the Washington Convention and was appointed as an arbitrator by Zimbabwe in September 2011 in the two cases: (1) Bernhard von Pezold and Others v. Republic of Zimbabwe (ICSID Case No. ARB/10/15) and (2) Border Timbers Limited, Border Timbers International (Private) Limited, and Hangani Development Co. (Private) Limited v. Republic of Zimbabwe (ICSID Case No. ARB/10/25). He is good at applying theory to practice when handling disputes and identifying key issues surrounding the disputes. The expert opinions on some cases and the commenting articles in the series works refl ect his strong legal reasoning and passion for justice.

Sixth, the series works collect his many articles published in English. Professor CHEN started to further learn English when he was 50 years old, and now he can fl uently defend in oral English and write English articles for publication in English journals. The purpose of his writing in English is to exchange ideas with international scholars, express Chinese concerns and opinions, and defend the Third World people.

Professor An CHEN created the Chinese-style IEL and he is honored as the founder and leading scholar of Chinese IEL. This is the right reason that he has been repeatedly elected to hold the position of Chairman of the Chinese Society of International Economic Law ever since 1993. In order to expand the effect of his academic thoughts on international law, a special conference “The Research Approach of Chinese IEL and Prof. An CHEN’s Academic Thoughts” was held in Xiamen on his eightieth birthday in 2009, and the An CHEN Foundation of International Law Development, titled with his name, was established in 2011. Now, he is already in his 80s, but he continues to study, research, and keep diligently writing valuable articles. I would like to conclude this book review with another Chinese saying, “An old steed in the stable still aspires to gallop a thousand Li —old people may still cherish high aspirations” (老骥伏枥,志在千里).

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References

1. An CHEN. (2003). The three big rounds of U.S. unilateralism versus WTO multilateralism during the last decade: A combined analysis of the great 1994 sovereignty debate, Section 301 disputes (1998–2000), and Section 201 disputes (2002–present). Temple International and Comparative Law Journal, 17 , 409–466.

2. South Center. Working papers no.22 . Available at http://www.southcentre.org/publications/workingpapers/paper22/wp22.pdf . Last visited on 1 Sept 2011.

3. Shan, W., et al. (Eds.). (2007). Refi nding sovereignty in international law (pp. 87–146). Oxford: Hart Publishing.

4. An CHEN. (2009). Third comments on China’s strategic position in the establishment of NIEO: To where would the G20 & its “Path from Pittsburgh” lead—The pending riddle of the new platform of G20 south–north cooperation and the confl ict between ideas such as “Law-abiding” and “Law-reforming” (“Third Comments” for short). Journal of International Economic Law (China), 16 , 1–29.

5. An CHEN. (2008). An CHEN on international economic law (Vol. 1, pp. 13–16). Fu-Dan University Press.

6. An CHEN. (2006). A refl ection on the South-South coalition in the last half- century from the perspective of international economic law-making: From Bandung, Doha and Cancún to Hong Kong. Journal of World Investment & Trade, 7 , 201–233.

7. An CHEN. (2009). A clear-cut stand on China’s strategic position in the establishment of NIEO: With comments on an integral and accurate comprehension of Deng Xiaoping’s 28-word foreign policy (“Second comments” for short). Journal of International Economic Law (China), 16 , 55–81.

8. Jackson, J. H. (2006). Sovereignty, the WTO and changing fundamentals of international law (pp. 134–135).

9. Wen, J. Casting sights to China—Speech at Harvard University. Available at http://www. chinanews.com.cn/n/2003-12-12/26/380015.html . Last visited on 1 Sept 2011.

10. Wen, J. To recognize a real China—Speech in general debate of the 65th United Nations assembly. Available at http://politics.people.com.cn/GB/1024/12800629.html . Last visited on 1 Sept 2011.

11. Gao, Y. (2004). Comments on various disadvantageous articles in legal documents on the accession of PRC to WTO. Journal of International Economic Law (China), 11, 46–81.

12. Zhao, W. (2002). Discriminatory safeguard article—An interpretation on Art. 16 of protocol on the accession of the PRC. Journal of International Trade (China), 4, 35–39.

13. Panel Report. (1999, December 22). United States—Sections 301–310 of the trade act of 1974, WT/DS152/R . Available at http://www.worldtradelaw.net/reports/wtopanels/us-section301(panel).pdf . Last visited on 1 Sept 2011.

14. Chang, S. W. (2000). Taming unilateralism under the trading system: Unfi nished job in the WTO panel ruling on United States sections 301–310 of the trade act of 1974. Law and Policy in International Business, 31, 1156.

15. An CHEN. (2008). An CHEN on international economic law (Vol. 4, pp. 1725–1807). Fudan University Press.

16. An CHEN. (2008). An CHEN on international economic law (Vol. 1, pp. 409–420). Fudan University Press.

17. Bush, G. W. President’s statement on steel . Available at http://georgewbush- whitehouse.archives.gov/news/releases/2003/12/20031204-5.html . Last visited on 1 Sept 2011.

18. Lamy, P. (2010, October 1). The Doha round marks a transition from the old governance of the old trade order to the new governance of a new trade order. WTO News . Available at http://www.wto.org/english/news_e/sppl_e/sppl173_e.htm . Last visited on 1 Sept 2011.

19. An CHEN. (2011). Some jurisprudential thoughts upon WTO’s law- governing, law-making, law-enforcing, law-abiding and law-reforming. Journal of World Investment & Trade, 12 (Pt. VII).

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20. An CHEN. (2008). An CHEN on international economic law (Vol. 1, pp. 13–16). Fudan University Press.

21. Lowenfeld, A. F. (1982). International private investment: International economic law (Vol. 2). Preface (vii).

22. An CHEN. (2005). CHEN’S papers on international economic law (pp. 525–531). Beijing University Press.

23. An CHEN. (2008). An CHEN on international economic law (Vol. 1, pp. 919–925). Fudan University Press.

24. An CHEN (Ed.). (1986). Cross verbal swords—Five famous cases on international investment disputes (pp. 97–166).

25. Zemin Jiang. (2000, October 11). China-Africa cooperated hand in hand, creating a new century . People’s Daily.

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