Enforcing foreign judgments in Taiwan: An insight into judicial practice

Chen & Lin Attorneys-at-Law
Shu-Wei Lo and Luc Chen
[email protected]; [email protected]

If the prevailing party of a foreign final civil judgment intends to enforce a judgment in Taiwan, the prevailing party shall obtain a recognition judgment for such foreign judgment from a Taiwan court. According to Article 402 of the Taiwan Civil Procedure Act, one of the requirements for recognition is that the foreign country's courts also recognise Taiwanese judgments. Before 2004, the prevailing party shall prove that the foreign country's courts have a precedent that recognises Taiwanese court judgments or that the foreign country has treaties with Taiwan regarding judicial matters. Before 2004, Taiwanese court practice made it burdensome for the prevailing party to obtain a recognition judgment from Taiwanese courts. However, in 2004, the Taiwan Supreme Court rendered a milestone judgment which opined that if a foreign country is likely to recognise a Taiwan judgment in accordance with its statutory laws or common laws, a recognition judgment shall be rendered. Under this opinion, the prevailing party does not need to submit any foreign court's precedent that recognises Taiwan's judgments as evidence, but the counterparty shall bear the burden of proof that Taiwan's judgments will not be recognised under foreign laws. However, the prevailing party may still need to submit evidence of the foreign country's laws to support the claim that the foreign country's courts would be likely to recognise Taiwan's civil judgments. To the relief of creditors, the Taiwan Supreme Court's opinion dramatically switched the burden of proof.

Our search of the Taiwan judicial retrieving system database reveals that up to March 2011, Taiwan courts have rendered recognition judgments to at least 14 countries' civil final judgments. The 14 countries are Australia, Belgium, Mainland China (People's Republic of China), Hong Kong, Japan, Korea, Malaysia, New Zealand, the Philippines, Singapore, South Africa, United Kingdom, the United States of America and Vietnam.

Due to Taiwan's special political situation with Mainland China, the so-called foreign judgments in Taiwan can be categorised into three types: judgments rendered by the courts of (1) Mainland China, (2) Hong Kong and Macao, and (3) other foreign countries. The legal bases for such categorisations are, respectively, Article 74 of the Act Governing Relations between People of the Taiwan Area and Mainland Area (Taiwan and Mainland China Relation Act) and Article 42 of the Act Governing Relations with Hong Kong and Macao (Taiwan and Hong Kong Macao Relation Act), and Article 402 of the Civil Procedure Act.

According to Article 42 of the Taiwan and Hong Kong Macao Relation Act, with respect to the requirements for recognition of Hong Kong and Macao's final civil judgments, Article 402 of the Civil Procedure Act shall apply mutatis mutandis thereto. Therefore, the requirements for the recognition of judgments rendered in Hong Kong and Macao are not different from those for other foreign countries. As stated in the first paragraph, it is not necessary for a prevailing party to prove that such foreign courts have precedent that recognise Taiwan civil final judgment.

As for Mainland China's civil final judgments, a prevailing party does not have any burden of proof on Mainland China's laws or precedent that recognises Taiwan's judgment pursuant to Taiwanese court practice. As such, a prevailing party from Mainland China bears less burden of proof than a prevailing party from other foreign countries. However, according to the Taiwan Supreme Court's judgment, a Taiwan court's ruling for recognition of Mainland China's final civil judgment is a ruling which, as opposed to a final civil judgment, does not has a binding effect, according to Article 74 of Taiwan and Mainland China Relation Act. Therefore, a debtor may file a claim against a creditor based on the same cause of action pursuant to Article 14 of the Taiwan Compulsory Enforcement Act. Once a debtor files such claim against a creditor, a Taiwan court will review the whole case and may overrule Mainland China's final civil judgment.

In summary, the Taiwan court's final judgments for the recognition of foreign judgments, including Hong Kong and Macao, are binding and debtors cannot initiate any lawsuits based upon the same cause of action. However, the Taiwan court's final rulings for the recognition of Mainland China's final civil judgments are not binding and debtors may initiate lawsuits against creditors based upon the same cause of action. In view of the Taiwan court's practice on Mainland China's final civil judgments, if a Mainland China creditor plans to enforce debtors' assets in Taiwan, it is advised to file complaints against the debtor through the Taiwan courts or obtain other foreign countries' civil final judgments.