| Pakistan and China are traditionally good friends. With the development of China as an emerging manufacturing centre of the world, its commercial relations with Pakistan are increasing very fast. Moreover Chinese surplus capital accompanied with cheap technology also finds Pakistan as a favorable destination. This situation requires a better understanding of the legal system by the stakeholders on both sides. Recognition and enforcement of foreign arbitral awards in both countries is the most important subject for stakeholders because international arbitration has emerged as the most effective and widely acceptable method of dispute resolution in commercial and investment matters. Although there have been some legal mechanisms operating in both countries for centuries which had some similarities with the modern concept of arbitration, yet the new concepts of international arbitration which have got currency all over the world have been borrowed from the West.International regime on recognition and enforcement of foreign arbitral awards has mainly developed in the last century. Major contribution in bringing about an international system has been made by the League of Nations and later on by UN. The New York Convention 1958, the International Convention on Investment 1965, creation of UNCITRAL, the UNCITRAL Arbitration Rules 1976, the UNCITRAL Model Law 1985 have all contributed to the gradual evolution of an international system of arbitration in commercial and investment disputes.akistan became a member of the New York Convention in 2005. Therefore, it promulgated its first ordinance in 2005 on this subject which fulfilled its obligations under the New York Convention. Before that another law which was introduced by the Great Britain before the independence of Pakistan was in force in Pakistan and it dealt with the subject matter under the obligations of the League of Nations arrangements. After the promulgation of the first ordinance, its life was extended many times in the form of re-promulgation and currently the ordinance introduced in 2009 is in force. Another ordinance deals with the arbitral awards in investment disputes made under the International Convention of Investment Disputes made in Washington. Both these Ordinances are very short pieces of legislation and they require the Pakistani courts to recognize and enforce foreign arbitral awards made under the above-mentioned international conventions. They also provide for some of the procedures. There is no special procedural law on this subject therefore the ordinary procedural law has to be resorted to during the proceeding under these ordinances.On the Chinese side, it has not introduced a separate law giving effect to the New York Convention or the International Convention on Investment Disputes, nor has it adopted the Model Law of UNCITRAL. Major rules governing the enforcement of a foreign arbitral award come from the Civil Procedure Law 1991, the relevant statutory interpretations of the National Supreme Court, the General Principles of Civil Law and some other civil laws currently in force.A comparative analysis of the legal systems of both the countries reveals that a reliable system of recognition and enforcement of foreign arbitral awards is in place in both the countries. On the points of jurisdiction, forum, involvement of higher courts, right to appeal, limitation and time taken in implementing a foreign arbitral award:there exist some similarities and some dissimilarity in both legal systems. Both of them work in their own way. But in order to make their systems more reliable and more credible, both countries need to make further improvements in terms of bridging the gaps in laws as well as ensuring that whatever the laws are they are implemented fully in an impartial way. These measures will go a long way to improve the commercial and investment relations of Pakistan and China between each other and with the rest of the world.
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