According to the relevant laws of China, the parties to a foreign-related contract may choose the law applicable to the settlement of contract disputes, unless otherwise stipulated by law. If the parties to a foreign-related contract do not choose, the law of the country most closely related to the contract shall apply.

The laws of the People's Republic of China shall apply to contracts for Chinese-foreign equity joint ventures, chinese-foreign contractual joint ventures and Chinese-foreign joint exploration and development of natural resources performed within the territory of the People's Republic of China.

Restrictions on the choice of applicable law by the parties to the contract

Express choice of applicable law

Article 3 of the Law on the Application of Laws in Foreign-related Civil Relations stipulates that the parties may explicitly choose the applicable laws in foreign-related civil relations in accordance with the provisions of the law.

Article 8 of the Interpretation of the Supreme People's Court on Several Issues concerning the Application of The Law of the People's Republic of China on The Application of Law concerning Foreign-related Civil Relations (I) stipulates that the people's court shall permit the parties to choose or change the applicable law by agreement before the conclusion of the debate in the court of first instance.

If the parties invoke the laws of the same country without raising any objection to the application of the laws, the people's court may determine that the parties have made a choice on the applicable laws of foreign-related civil relations.