Bill Dodge has an excellent post at the Transnational Litigation Blog explaining China’s new Foreign State Immunity Law, which adopts the restrictive theory of foreign sovereign immunity. The United States and many other countries follow the restrictive theory, but China, until now, had been one of the holdouts for the older absolute theory of foreign sovereign immunity.
Refer to Bill’s post for details about the new law. From the perspective of China’s national interests, the new law makes good sense. China is already subject to suit in the courts of many foreign states in cases within an exception to the ordinary rule of foreign sovereign immunity, so why should Chinese courts not entertain claims, presumably by Chinese nationals, against those foreign states in Chinese courts? Indeed, the Chinese government seems especially interested in reciprocity. One unusual feature of the new law is that it authorizes suits against a foreign state on grounds that the foreign state’s courts would allow a lawsuit against China to go forward. In other words, if the United States, say, were to adopt a new exception to foreign sovereign immunity, then the United States would be liable to suit in China on that theory. We don’t do things that way, but it seems sensible to me, given the tendency we sometimes see to expand exceptions to foreign sovereign immunity beyond what international law seems to allow.