While infrastructure is at the core of the Belt and Road initiative, this project also requires the implementation of common commercial and legal instruments and rules for the states of the new Silk Road. The intensification of trade along the OBOR will lead to a possible increase in disputes between trading partners. It is urgent that European and Asian authorities and law firms meet this challenge.
According to an article published in “China Daily“, in 2016, lawsuits involving foreign companies in China increased by almost 10%; disputes related specifically to maritime trade rose by 25%. Chinese authorities are aware of this phenomenon and are keen to improve the services offered by their judicial system to better protect the exchanges created by the Belt and Road initiative.
Investments in Central Asia, a key region of the OBOR, are the ones that require the greatest legal expertise due to the recent access of Central Asian states to the market economy.
Hong Kong with its many law firms that enjoy a solid experience in transactions between China and the rest of the world could become the main legal hub of the OBOR. However, the main European financial centres accustomed to cross-border transactions can also be successful. Nevertheless, it is important for the main European law firms to develop legal expertise on the Belt and Road initiative in order to better protect their customers’ interests in all states of the new Silk Road.