4.1. Free trade and legal reforms: the neoliberal agenda

Free trade has been the defining feature of much of the work done on legal reforms since the end of the Second World War. The second half of the 20th century was marked by a significant consensus—both theoretical and practical—on advancing free trade, largely due to its perceived connection with personal freedom and democracy. Austrian economist Friedrich Hayek, a key figure in the formation of neoliberalism, famously argued that: “The system of private property is the most important guarantee of freedom, not only for those who own property, but scarcely less for those who do not” (Hayek, Reference Hayek2014). His ideas emphasized that the free market, protected by strong property rights, was the most effective way to safeguard individual freedoms and promote democratic governance.

Hayek’s views, along with those of other economists like Milton Friedman, became central to the shaping of economic policies in the post-war era. The rise of neoliberalism, especially during the 1970s and 1980s, ushered in a paradigm where free markets were seen not only as the most efficient method of economic organization but also as the foundation for a more just and democratic society. Neoliberal policies advocated for deregulation, privatization, and a diminished role for the state in economic affairs, a transformation that profoundly influenced both national and international legal frameworks. In the realm of policy and law, several neoliberal experts played a significant role in promoting these ideas, particularly through their influence on global institutions such as the World Bank and the International Monetary Fund (IMF).

The influence of neoliberal economic thought, particularly as expressed by the Chicago School of Economics, which advocates for privatization, trade liberalization, and deregulation as prerequisites for economic growth, became prominent during the mid-1970s. This ideology played a key role in shaping the economic policies of the Global North and, by extension, significantly influenced the development agendas of newly independent nations in the Global South. Legal reforms were often seen as a necessary and key complement to these policies (Glinavos, Reference Glinavos2008; Krever, Reference Krever and Brabazon2016). In the 1980s and 1990s, numerous countries in the Global South were encouraged—often under pressure from international financial institutions—to adopt legal frameworks that promoted free market principles. These legal reforms, which included protections for property rights, the removal of trade barriers, and the restructuring of state-owned enterprises, are a clear example of legal transplants driven by external economic and political agendas originating in the Global North.

4.2. Socialist rule of law with Chinese characteristics

The second example to examine China’s experience with legal transplants is the concept of the rule of law. The widely discussed amendment to the Chinese legal framework in 1999, driven by major organizations and Global North countries, incorporated the concept of the rule of law. Article 5 of the Chinese Constitution was amended to state: “The People’s Republic of China governs the country according to law and makes it a socialist country under rule of law.”

The translation of the term “rule of law” in Chinese, 法治 (fazhi), or as it appears in the Constitution 依法治国 (yifazhiguo), is open to various interpretations, ranging from “rule of law” “rule by law” to “rule the country according to the law.” Legal scholars have described the rule of law in China as implementing a thin or formal version of the concept, primarily as a means of formally complying with the requests of the international community (Backer, Reference Backer2006; Minzner, Reference Minzner2011). Chinese scholars, on the other hand, consistently discuss the concept within the framework of “socialist rule of law with Chinese characteristics”—a Sinicized version of the rule of law distinct from the international concept (Wang and Li, Reference Wang, Li, Costa and Zolo2007; Xu, Reference Xu2019).

When examining the rule of law as a form of legal transplant, it is crucial to highlight China’s functional and pragmatic approach to this concept, which is now widely employed to reinforce the leadership of the CPC (Liebman, Reference Liebman2014; Fu, Reference Fu and Chen2017).

As emphasized by Jiang Zemin prior to the enshrinement of the concept in the constitution, the implementation of the rule of law “means that the broad masses of the people are under the leadership of the party and governed in accordance with the Constitution and laws” (Speech at the End of the Lecture on Legal System by Central Leading Comrades Held by the Central Committee of the Communist Party of China, 1996).

This broader goal was upheld throughout subsequent leadership transitions, which not only continued to emphasize the rule of law but also adapted it to better align with China’s unique context. During the 2014 Fourth Plenary Session, the CPC Central Committee issued the “Decision Concerning Some Major Questions in Comprehensively Advancing the Rule of law.” In China’s interpretation, the rule of law emphasizes accountability and transparency (Li, Reference Li and Li2018). While these two components are central to the international concept of the rule of law, they were specifically chosen because they can be effectively integrated into China’s governance model. The rule of law in this context has been utilized as a tool to strengthen the CPC’s leadership and control over its members, rather than as a mechanism to steer the country towards a liberal form of governance—something the CPC has never intended, even when incorporating the concept into the Constitution. This emphasis on control is rooted in the necessity for new mechanisms of accountability within the party itself. As Liebman noted, this enhanced control serves as “a strategy for pre-empting the development of vertical accountability, particularly by non-state actors, which could lead to broader democratic challenges” (Liebman, Reference Liebman2011).

In terms of accountability, the concept has primarily been implemented through administrative remedies and anticorruption campaigns targeting lower levels of bureaucracy (Ma and Wang, Reference Ma and Wang2018). The CPC’s history is marked by periodic changes in party organization and supervision, a trend that has continued under Xi Jinping’s leadership. Since the Fourth Plenary Session of the Eighteenth CPC Central Committee in 2012, the idea of a “socialist rule of law with Chinese characteristics” has become central to the nation’s governance framework.

The concept of the “socialist rule of law with Chinese characteristics” is not merely a theoretical framework; it is actively implemented through a range of practical and legal measures designed to support the CPC governance priorities. One of the most prominent manifestations of the socialist rule of law is the CPC’s anti-corruption campaigns, particularly under Xi Jinping’s leadership. These campaigns target officials at all levels, from high-ranking “tigers” to low-level “flies.” For example, the investigation and prosecution of high-profile figures such as Zhou Yongkang, a former member of the Politburo Standing Committee, demonstrated the use of legal mechanisms to discipline party officials while reinforcing internal accountability within the party (Feng, Reference Feng, Garrick and Bennett2016). Additionally, the 2015 China’s Administrative Litigation Law allows citizens to sue government agencies for specific violations, but these cases are carefully controlled to ensure they do not challenge the broader authority of the state. For instance, citizens may file lawsuits over land use or environmental violations, but the outcomes are often designed to address specific grievances without undermining the CPC’s overall governance (Haibo, Reference Haibo2010). Another example is the social credit system, a nationwide initiative, which reflects the application of the rule of law with Chinese characteristics by combining legal, administrative, and technological tools to enforce societal norms. This system tracks individual and corporate behaviour, rewarding compliance with laws and regulations while punishing violations through restrictions on travel, business operations, or credit access.

Moreover, the CPC has prioritized legal education campaigns to promote awareness of laws and regulations among the public. However, these campaigns also emphasize the role of the law in supporting socialist values and the leadership of the CPC. For instance, the annual “Constitution Day” celebrations often include speeches and activities that highlight the integration of the rule of law with socialism.

It is extremely important that the phrase “socialist rule of law” was also included in the Chinese Constitution, particularly in Article 5, which provides a legal foundation for this concept. The Constitution states that “the People’s Republic of China governs the country according to law and makes it a socialist country under the rule of law,” explicitly tying legal governance to socialist principles (The State Council of the People’s Republic of China, 2018).

Expanding the powers of the National Supervisory Commission, a state body responsible for overseeing anti-corruption efforts, this law integrated party disciplinary mechanisms with state institutions, exemplifying how legal structures are designed to enhance CPC control and accountability. The 2014 Environmental Protection Law of the People’s Republic of China strengthened mechanisms for holding local governments and businesses accountable for environmental violations. However, the law also reinforced the state’s control over environmental activism by regulating the activities of non-governmental organizations and limiting their ability to challenge government policies. The 2017 Cybersecurity Law of the People’s Republic of China imposed strict regulations on internet usage, requiring companies to store data domestically and censor content deemed harmful to social stability. While framed as a legal measure to protect national security and social order, it also serves to consolidate state control over information and suppress dissent, aligning with the CPC’s priorities. In the field of judicial reforms, pilot programmes have been held, such as the introduction of circuit courts and judicial accountability systems, which have aimed to improve efficiency and reduce corruption within the judiciary. However, these reforms are implemented under the premise that the judiciary remains subordinate to the party’s leadership, ensuring that courts function as tools of governance rather than independent arbiters.

China has made impressive strides in transparency in making laws and case law publicly accessible—arguably surpassing some major Global North countries in openness and ease of access. Since 2009, judicial transparency has been significantly advanced through efforts by the Supreme People’s Court, which has made millions of cases available to the public via user-friendly platforms. This digitization and widespread availability of court judgements have the potential to greatly enhance transparency and provide valuable insights into Chinese law and practices. However, effectively analysing and interpreting this wealth of information requires the development of novel computational research methods like Text as Data techniques (Liebman et al., Reference Liebman, Roberts, Stern and Wang2020; Stern et al., Reference Stern, Liebman, Roberts and Wang2020). Transparency in China is not limited to case law; it also extends to politically sensitive areas such as party regulations, which have traditionally been hidden from scrutiny (Seppanen, Reference Seppanen2019). The emphasis on the rule of law has resulted in a significant increase in published data, making notable progress. In some respects, this openness even exceeds that of many democracies, where the internal workings of political parties remain opaque, and accountability is frequently more formal than substantive.

One notable example of increased transparency is the publication of the 2015 Regulations on the Work of the Central Committees of the Communist Party of China. These regulations outline the principles, responsibilities, and procedures governing the activities of the central committees, providing clearer guidance on intra-party governance. By making these documents publicly accessible, the CPC has allowed scholars, practitioners, and the general public to better understand the mechanisms and decision-making processes within the party.

Another significant step is the publication of the 2018 Regulations of the Communist Party of China on Disciplinary Actions, which detail the standards of conduct expected from party members and the disciplinary measures for violations. Previously, such regulations were largely confidential and implemented without external scrutiny. Now, their availability has increased accountability by enabling both party members and external observers to track the enforcement of these rules and the consistency of disciplinary actions.

The 2019 Regulations on Strengthening Supervision of Leading Cadres provide another example. These regulations focus on curbing abuses of power by senior officials and ensuring that they adhere to party policies and ethical standards. By publishing these rules, the CPC aims to strengthen its internal governance and address corruption concerns. Public access to these regulations has also enhanced transparency and allowed for broader discussions about their implementation.

Lastly, the 2020 United Front Work Regulations of the Communist Party of China, which govern the party’s engagement with non-communist groups and organizations, have also been made public. These regulations clarify the scope and boundaries of the party’s influence over civil society, addressing concerns about overreach. Their publication marks a transition towards a more structured and transparent approach to managing relations with external stakeholders.

This growing openness in party regulations underscores a significant change in China’s governance model. While the primary objective remains strengthening the party’s control, the publication of these documents reflects a broader commitment to rule-based governance and improved accountability, setting a notable example in the realm of political transparency.

China’s version of the rule of law has not only shaped its domestic legal landscape but is also increasingly influencing how the country interacts with the legal and regulatory frameworks of other nations. Central to this approach is the strategic use of law to govern conduct, maintain control, and guide society in the direction defined by the state. By adapting and integrating legal transplants to fit its specific socio-political and cultural characteristics, the concept of the rule of law has become a cornerstone for understanding China’s legal system. This adaptation demonstrates that, while the socialist rule of law with Chinese characteristics may initially seem highly country- and context-specific, its application extends far beyond ideological confines. On the one hand, it offers positive implications, such as increased accountability for officials managing res publica and a focus on collective well-being. On the other hand, it raises concerns over the centralization of power and the potential erosion of individual human rights.

China’s model showcases a pragmatic approach where legal norms are tailored to support governance priorities. For instance, laws governing corporate governance and environmental regulation have been introduced with an emphasis on compliance and alignment with state goals, influencing global regulatory practices in trade and investment. However, this model also reflects a prioritization of state stability over individual liberties, a dynamic that has drawn international criticism. Ultimately, China’s interpretation of the rule of law underscores its dual function: as a tool for internal governance and as an instrument for projecting influence in the global legal order. This duality raises important questions about the balance between state control and individual freedoms, as well as the evolving role of law in a multipolar world.

China’s experience with legal transplants in the context of the rule of law mirrors its approach to free trade, revealing notable patterns. First, China has selectively integrated specific elements of the international rule of law into its legal system while ensuring these aspects remain subordinated to the overarching objectives of the CPC. Second, the modifications to its legal framework are implemented on a voluntary and pragmatic basis, with a focus on reinforcing party supremacy rather than introducing liberal values. Third, the socialist rule of law with Chinese characteristics serves as a dynamic policy framework, guiding legal developments and reforms in line with shifting priorities. While varying levels of implementation of the rule of law exist across different areas of positive law, China’s legal system is inherently flexible. Laws are not rigid but are designed to adapt to policy demands rather than dictate them. For example, the accountability of party officials is not uniformly applied but varies according to political priorities. High-profile cases such as those of former Politburo members Bo Xilai and Sun Zhengcai illustrate this selective enforcement. Both individuals, perceived as misaligned with Xi Jinping’s leadership, faced targeted investigations, whereas others in similar positions did not undergo scrutiny. This flexibility underscores the instrumental nature of law in China, where legal frameworks are shaped to serve state objectives rather than adhere to universal principles. In Section 5, we identify three critical factors that illustrate how China’s approach to legal transplants is influencing its broader legal reforms and shaping its engagement with the BRI.

5.1. “Combining Chinese and Western practices”

Since at least the Wuxu reform, China has extensively relied on foreign expertise to enhance its highly bureaucratic and centralized system of governance with the aim of modernizing the nation. A popular slogan from the late Qing empire encapsulated this approach: “keep the Chinese foundations while using Western knowledge” (中体西用—zhongti xiyong). However, the adoption and adaptation of “barbarian” legal institutions were carefully mediated by the unique circumstances of national development. As Sun Zhongshan famously remarked, “Our youths are constantly trying to learn everything the West has to teach, but what is newest in the West has existed in China for thousands of years” (Sun, Reference Sun2011, p. 36).

Under his “Program of National Reconstruction: The Three Stages of Revolution” (1918), Sun Zhongshan envisioned a constitutional form of governance (宪政) as the final stage of the revolution, preceded by stratocracy (军政) and a period of political tutelage (训政). The period of political tutelage, formalized by the Provisional Constitution for the Period of Political Tutelage of the Republic of China (中华民国训政时期约法) in 1931, established key features that significantly influenced the subsequent constitutional development of the country. These features included the Three Principles, the Five-Power constitutional idea, the one-party dictatorship (Article 72), bureaucratic capitalism over strategic resources (官僚资本) (Article 33), and judicial review controlled by the leading party (Article 85). These elements reflect a selective adaptation of foreign legal models, implemented in China as part of its exposure and engagement with external systems while maintaining its distinctive political and ideological characteristics.

To preserve Chinese foundations—today represented by the core socialist values (社会主义核心价值观 – shehui zhuhi gaixin jiazhiguan)—the process of legal transplantation itself has been subject to scrutiny and redefinition (Sun, Reference Sun2013; Liu, Reference Liu2014; Gow, Reference Gow2016). Rather than a straightforward transplantation or adaptation, what occurred in China was a complex and often fragmented mimesis of external experiences, aimed at crafting new institutions. In this process, there is neither a clear donor nor recipient within the legal system. Notably, even during the Republican period, legal institutions were implemented from a diverse and inconsistent array of sources.

Legal influences ranged from the Soviet Union and Japan to continental Europe models (notably Italy, France, and Switzerland) to even the US. This eclectic approach to structuring the national legal system underscores the rapid circulation of legal ideas and demonstrates that “the history of a legal system is largely a history of legal materials borrowed from other legal systems” (Monateri, Reference Monateri2008). Such historical experiences highlight the dynamic and non-linear nature of legal development in China, where external influences are constantly reinterpreted to align with domestic priorities and cultural values.

While certain legal materials are adopted through transplantation, others are deemed incompatible with core socialist values and remain off-limits. This selective borrowing suggests that to understand the factors shaping the adaptation of the legal transplants, it is essential to examine the key tenets of liberalism. China has undergone numerous, and at times seemingly contradictory, reforms touching every aspect of state organization and the relationship between citizens and the ruling party. The enduring tension between the rule of man (unconstrained power) and the rule of law (institutional constraints on power) has been a defining feature of the modernization of China’s legal system and remains highly relevant today (Zhang, Reference Zhang2014). Since the reform and opening-up period, the international community has consistently exerted pressure to promote liberal values in China. However, many of the legal transplants introduced with this aim have failed to achieve the desired outcomes. Understanding the factors driving legal changes in China can provide valuable insights into why these transplants have not functioned as anticipated by external observers. This analysis also sheds light on the broader dynamics of legal reform, where domestic priorities often outweigh external expectations, leading to outcomes that reflect China’s unique socio-political context.

Legal institutions, particularly in the past, were often circulated as instruments of power or as mechanisms to safeguard the rights of invaders unfamiliar with local laws and cultural practices. In this context, the extraterritorial clauses established in post-Opium War institutions in China offer valuable insights into the actors driving legal transplants. These actors primarily included nation-states and the legal elites within those states. The purpose of such transplants was not to foster mutual understanding or adaptation but to ensure the supremacy and dominance of the donor state over the recipient. The legal frameworks imposed during this period served to entrench the power of foreign actors, often at the expense of local sovereignty and legal traditions. As mentioned before, this dynamic underscores the asymmetrical nature of historical legal transplants, which were tools of imperialism and control rather than genuine legal exchange.

Reflecting on the Westernization process, particularly during the brief Republican period, legal transplants often proved to be devoid of substantive meaning for Chinese citizens (Ruskola, Reference Ruskola2013, p. 66). Extraterritoriality emerged as the preferred mechanism employed by foreign governments to ensure special treatment for foreigners and to pre-empt potential conflicts between Chinese nationals and non-Chinese individuals. Interestingly, even when China found itself in the role of a “colonizer,” it relied heavily on local laws and regulations to reinforce formal adherence and compliance. Legal equality was only marginally enforced, reflecting a strategic use of existing legal frameworks rather than a wholesale imposition of new systems (Heuschert, Reference Heuschert1998). This selective engagement with local legal traditions highlights the nuanced and pragmatic approach China has historically taken towards the use and adaptation of legal institutions.

Similarly, significant differences in the application of laws within China have historically depended on one’s ethnicity. This duality also stemmed from the fact that Western legal culture, which played a key role in fostering the rapprochement between China and the West (Zhang, Reference Zhang2014), was always filtered through the lens of China’s national development. This pragmatism can be observed in the way China has tailored foreign legal frameworks, laws, and regulations to align with its socio-political realities and developmental priorities.

During the late Qing Dynasty, China faced increasing pressure to modernize its legal system. Influenced by the German Civil Code and Japanese legal reforms, the Qing government embarked on codification projects, including the Da Qing Lü Li (大清律例). However, while borrowing structural elements and legal categories from these foreign systems, the Qing maintained a Confucian moral foundation (Farah, Reference Farah, Bombelli and Montanari2008), ensuring that imported concepts such as individual rights were balanced with communal obligations. This combination reflected a pragmatic adaptation that prioritized societal harmony over the individualistic tendencies of Western models. The codification process was not a wholesale import but a selective integration aimed at maintaining stability and governance within a Confucian societal framework.

Under the Republic of China and the Civil Code of 1929–30, legal reformers drew from multiple sources, including the German Civil Code, the Swiss Civil Code, and Japanese law, to create a modern civil code. This code introduced concepts like property rights and contract law but adapted them to fit China’s agrarian economy and traditional societal structures. For instance, familial property arrangements and customary practices were integrated into the framework, ensuring broader acceptability among the population. The reformers recognized the importance of maintaining continuity with existing practices while modernizing the legal system to support economic and social transitions.

During the 1950s, land reform laws were implemented to redistribute land from landlords to peasants. This initiative was based on socialist principles but adapted to the specific conditions of rural China. For example, rather than imposing a uniform national framework, local revolutionary committees had significant discretion in implementing policies. This allowed them to account for regional variations in land ownership patterns and social dynamics. The approach balanced ideological goals with the practical realities of China’s vast and diverse rural landscape, ensuring smoother implementation and reducing resistance.

China’s legal reforms during the reform and opening-up period showcase pragmatism on a larger scale. For instance, the establishment of SEZs like Shenzhen introduced laws that deviated from the national framework to attract foreign investment. The SEZs adopted international standards in trade, taxation, and dispute resolution, while still operating under the overarching socialist framework. The SEZs allowed China to experiment with capitalist principles in localized areas, mitigating risks while gradually integrating successful practices into the broader economy (Zheng et al., Reference Zheng, Barbieri, Tommaso and Zhang2016).

In recent decades, China has incorporated aspects of international environmental law into its domestic framework, such as the Environmental Protection Law. While aligning with global norms like the precautionary principle, the law retains a strong focus on centralized enforcement and the role of state-led initiatives, reflecting China’s governance model. Programmes such as the National Emissions Trading System (ETS) combine market mechanisms with state oversight to address environmental challenges. The integration of international norms with domestic enforcement strategies ensures that reforms are feasible within China’s political and institutional structure.

Under the BRI and China’s new period of transnational legal engagement, it has signed numerous bilateral agreements and memoranda of understanding that incorporate international arbitration norms. However, China often emphasizes “soft law” mechanisms and non-binding agreements, reflecting a preference for flexibility and consensus-building. For instance, Chinese investment contracts often incorporate both local laws and clauses for arbitration under international frameworks like UNCITRAL. This dual approach ensures adaptability to different legal systems while protecting China’s strategic interests in its international engagements.

China’s pragmatic approach to legal adaptation involves tailoring foreign frameworks to align with its unique socio-political and cultural context. Whether by selectively incorporating elements of foreign legal codes, experimenting with localized reforms, or blending international norms with domestic governance priorities, China demonstrates a nuanced strategy that balances modernization with stability. This approach underscores China’s capacity to absorb external influences without losing sight of its foundational values and developmental objectives.

Under the BRI, a similar pattern emerges, where Western knowledge is integrated with Chinese approaches, resulting in the creation of new institutions that draw from both systems. A notable example is the establishment of the China International Commercial Court (CICC). Created by the Supreme People’s Court in 2018, the CICC represents a significant step in China’s institutional evolution, marking the first time the country has developed a mechanism specifically targeting external actors. The CICC provides a forum for resolving international disputes, reflecting China’s efforts to protect legal influence and address issues with profound geopolitical implications (Cai and Godwin, Reference Cai and Godwin2019; Erie, Reference Erie2019; Chaisse and Qian, Reference Chaisse and Qian2021).

Regarding its scope, the Provisions of the Supreme People’s Court on Several Issues Regarding the Establishment of the International Commercial Court 2018 specify that the CICC accepts first-instance major international commercial cases involving disputes exceeding over 300 million yuan, cases of significant national impact, arbitration-related matters (Art 2), and disputes involving foreign parties, foreign locations, or cross-border issues (Art 3). Despite its international orientation, Article 4 mandates that the court’s eight judges must be Chinese nationals, with the qualifications of extensive experience in international law and proficiency in both Chinese and English.

A particularly notable provision for the scope of this discussion is how the CICC integrates Western and Chinese practices under its terms of reference. Article 11 establishes a “one-stop” international commercial dispute resolution mechanism that combines mediation, arbitration, and litigation within a unified framework. While Western courts often encourage these methods, they typically treat them as distinct processes with separate procedural mechanisms. In contrast, the CICC merges and integrates these steps, offering a streamlined approach. As Shan and Feng have noted, this reflects China’s specific vision of the law, deeply rooted in its national conditions. The CICC embodies an innovative “Chinese approach” to international commercial dispute resolution, representing a unique blend of global practices and domestic legal principles (Bell, Reference Bell2010; Shan and Feng, Reference Shan and Feng2022). Mediation and the pursuit of amicable solutions have been highlighted as key distinctions between Western legal systems, which are often more judgement-focused, and China, as well as the broader East, which tends to emphasize mediation and dispute avoidance—a tradition deeply rooted in Confucianism (Bell, Reference Bell2010). The integration of different procedural phases within the CICC reflects this cultural and legal philosophy, allowing both parties and judges to rely on mediation throughout the proceedings. This emphasis is further reinforced by the CICC’s explicit authority to issue a conciliation statement based on a mediation agreement, which, once signed by the parties, carries the same legal effect as a judgement. In contrast, Western courts typically require mediation agreements to undergo court approval before they are enforceable as judgements. The CICC’s streamlined approach eliminates this step, enhancing efficiency and aligning with its broader objectives. As Erie observes, the CICC, though designed as a fast, business oriented, and digitally advanced resolution mechanism for companies operating under the BRI, ultimately functions as a “court of limited jurisdiction built within the existing hierarchy of PRC courts” (Erie, Reference Erie2019). This duality underscores its pragmatic design: while globally oriented, it remains firmly grounded in China’s domestic legal framework and traditions.

While there is typically a tendency to bypass court proceedings in large-scale cross-border trade and investment, favouring arbitration mechanisms, the combination of Chinese and Western practices within the CICC has resulted in a legal innovation that holds promise for enhancing transparency, democratic control, and accountability in large commercial disputes. However, the anticipated improvements in these areas have been somewhat underwhelming. As of this writing, the court’s website has published only seven arbitration awards, two judgements, and zero mediation awards or projects. Furthermore, the use of the CICC has been limited, partly due to the hesitancy of foreign enterprises to move away from arbitration, which is often associated with greater confidentiality. More broadly, when it comes to legal transplants, the fusion of Western and Chinese practices, along with their underlying perspectives, is likely to be a significant feature of growing legal pluralism, particularly in the Global South. Rather than focusing on conflicts between legal models or the often-insurmountable challenges of reconciling foundational differences, this blend could foster greater diversity in legal reforms. However, the combination of radically different legal models may also undermine consistency and certainty in the law, potentially leading to a negative outcome. The risk of unduly broadening the legal framework due to selective adoption—what is often termed “cherry-picking”—as well as the interference of politics within the legal system, could further complicate the legal landscape. This is further explored in Section 5.2.

5.2. Voluntariness

The second characteristic that informs legal transplants under the BRI is directly connected to China’s experience with legal transplants. The imposition of transplants from developed countries, which was particularly prevalent during the colonial period, appears to have diminished for several reasons, not only in developing countries but also within the legal systems of the donor countries themselves. Economic globalization has led to an evolution in the actors responsible for legal transplants, moving from state to non-state actors. This shift reflects broader changes in the relationships among national states and the growing interconnections driven by economic globalization. On one hand, global governance institutions have promoted a vision of the world focused on increasing profitability, often at the expense of the traditional power dynamics rooted in the Westphalian model of state sovereignty.

In this context, transplanting legal institutions like the rule of law and private property often serves to reinforce neoliberal economic priorities and uphold the ideological dominance of the Global North. Regardless of cultural or national origins, what matters under this framework is adherence to the key tenets of neoliberalism, which prioritize profit-making for Global North countries and the protection of their investments. This approach exemplifies what Miller describes as an “externally dictated transplant,” wherein “a foreign individual, entity, or government mandates the adoption of a foreign legal model as a precondition for conducting business or granting a measure of political autonomy to the dominated country” (Miller, Reference Miller2003, p. 847). While less overtly violent than the imposition of the colonial period, this method still reflects an underlying presumption of the superiority of the Western legal culture over that of the host country. In contrast, China’s approach to legal transplants diverges significantly from such coercive practices. Instead, China emphasizes building external relations based on the Five Principles of Peaceful Coexistence (和平共处五项原则), which prioritize mutual respect for sovereignty, non-aggression, non-interference, equality, mutual benefit, and peaceful coexistence (Ma and Thakur, Reference Ma and Thakur2004; Zhang, Reference Zhang2018). Non-interventionism, a cornerstone of the Five Principles of Peaceful Coexistence, has been central to China’s approach to law, except in cases where its sovereignty is perceived to be under threat, such as territorial claims.

Under the BRI, non-interventionism shapes the framework for legal transplants, emphasizing voluntariness rather than imposition as a defining characteristic. Chinese scholars argue that China’s modernization path is deeply rooted in its unique circumstances, evolving in ways that are “appropriate for China’s national conditions, adapting to different development stages, and making full use of the superiority of the socialist system” (Hu et al., Reference Hu, Yan, Xiao and Liu2021, p. 30). For the CPC, imposing China’s legal model on other countries with vastly different national conditions is neither desirable nor strategically advantageous. Such impositions would infringe upon the sovereignty of other nations and risk fostering a negative perception of China as a neo-imperial power, contradicting its self-image as a non-interventionist actor. Compared to the US and the EU, this deliberate non-imposition has significant implications for legal pluralism under the BRI. Unlike Western models, which often accompany economic and political engagement with prescriptive legal frameworks, China’s legal transplants under the BRI are voluntary, fostering a more collaborative and non-coercive approach to legal integration. The transplant involves specific features or characteristics of an institution rather than the institution or its overarching ideology. This approach allows the borrowing country to selectively adopt only those elements that align with its unique circumstances, avoiding any imposition of ideology. Such flexibility expands the geographical reach of the transplant, minimizes disruptions to existing systems, and reduces the risk of rejection. Even countries that do not share the same values as the PRC can still benefit by integrating innovations from the Chinese legal system or adopting specific tools to manage or guide citizen behaviour. However, as with the combination of Western and Chinese practices, the voluntary nature of this approach may pose challenges to legal certainty and consistency. By encouraging selective adoption, the process risks further fragmenting an already diverse legal landscape. The cherry-picking nature of these transplants can result in uneven application and enforcement of laws, creating a patchwork of legal standards. Such inconsistency could lead to varying outcomes depending on the jurisdiction or the entities involved, undermining the predictability and reliability of the legal system in countries that voluntarily implement elements of China’s legal institutions. This issue is further compounded by the potential disconnect between the stated goal of promoting connectivity and the actual implementation, which may amount to little more than rhetorical commitments. As explored in the context of the final characteristic informing transplants—where policy is often prioritized over law—this inconsistency could have even more serious implications for the legal framework.

5.3. Policy ahead of the law

China’s legal system has long been characterized by the use of law as a tool of governance, underpinned by the principle that policy precedes law. This foundational approach reflects a key distinction from Western legal traditions, where law often functions as an independent framework for regulating society. A pivotal moment in this ideological divergence can be traced back to 1978, with Deng Xiaoping’s landmark speech, “Emancipate the Mind, Seek Truth from Facts and Unite as One in Looking to the Future.” Deng emphasized the critical role of strengthening the legal system, stating, “In order to protect the people’s democracy, the legal system must be strengthened” (为了保障人民民主，必须加强法制). Rather than focusing on law as an end in itself, Deng articulated a vision where legal reforms were inherently tied to achieving broader policy objectives. This integration of law and policy reflects the Chinese governance model, where the legal system is designed to align with and facilitate overarching socio-economic and political goals, rather than striving for an abstract notion of legal perfection (Zhen and Li, Reference Zhen and Li2003; Lin, Reference Lin2012; Yang, Reference Yang2022). This approach has continued to shape the evolution of China’s legal framework, distinguishing it from systems where law functions autonomously from policy considerations.

The ultimate aim of the reform in this context is the strengthening of the legal system, with positive laws (法律) and local regulations (法规) serving as tools to address the gaps within an incomplete or imperfect system (不 完 备). Keith highlights the changes in Chinese politics following Deng Xiaoping’s leadership and the Tiananmen incident, noting that “Party policy was not only a priori to law, but, in the absence of law, policy acquired the role and status of law.” (Keith, Reference Keith1991, p. 110). This distinction between policy (政策) and law (法律) is a fundamental characteristic of legal transplants under the BRI.

The Chinese understanding of the law is deeply influenced by Marxist theories, particularly Lenin’s perspectives on the role of law. Within this framework, law is seen as a tool to achieve policy objectives, which serve as the core (核心) and soul (灵魂) of the legal system. Policies are designed to fulfil the collective interests of society, but their articulation and implementation are ultimately determined by the CPC. Unlike in Western legal systems, where laws often operate autonomously and independently of policy, in China, policies are highly standardized, authoritative, and regulated. Instances of deviation or non-compliance tend to occur more frequently with laws rather than with the overarching goals encapsulated in policies. In this context, policies are seen as guiding instruments with clear objectives, while laws function as flexible mechanisms to operationalize and achieve these aims. This dynamic has significant implications for the adoption and adaptation of Chinese legal principles in other jurisdictions under the BRI framework.

Chinese scholars identify two major attributes of policy that distinguish it from law: timeliness (时效性) and correctness (正误). Timeliness refers to the contingent and situational nature of policy. Policies are designed to address specific material problems, such as regulating foreign relations or managing economic challenges. They are enacted for a defined period and may be adjusted or replaced based on appraisal and evaluation by the authority that implemented them. This flexibility allows policies to adapt dynamically to changing circumstances and priorities, making them responsive tools for governance.

Correctness is the second defining attribute of Chinese policy. Unlike the legal positivist tradition, where the moral or practical value of a law is considered irrelevant to its validity, Chinese policy operates on the assumption that its enactment is inherently correct, given the historical conditions at the time. This perspective assumes that policies are formulated based on careful analysis of current realities and collective needs, rendering them fundamentally aligned with the interests of society.

These two attributes of timeliness and correctness highlight the pragmatic and goal-oriented nature of policy in the Chinese context, distinguishing it sharply from the static and value-neutral principles often associated with law. This distinction plays a critical role in understanding the relationship between policy and law within China’s governance model, particularly in contexts such as the BRI, where policies often guide the implementation and adaptation of legal frameworks.

In addition to timeliness and correctness, it is relevant to mention the importance of expressiveness (表述性) that refers to how policies are expressed or articulated, possibly highlighting their communicative function or transparency. While timeliness and correctness focus on the practical and ideological aspects of policy, expressiveness refers to how policies are articulated and communicated by the authorities. Unlike laws, which are codified and designed to provide clear, general, and lasting rules, policies emphasize the articulation of specific goals and directives in response to immediate needs or objectives. The expressiveness (表述性) of the policy highlights its role as a vehicle for conveying the intentions and priorities of the governing body, particularly the CPC. Policies are crafted in a way that ensures their goals and purposes are understood not only by government officials but also by the general population and stakeholders. This characteristic underscores the dynamic and goal-oriented nature of policy, where clarity of intent is prioritized over rigid legal formalism. In contrast to law, which often requires interpretation by judicial systems, policy relies on its ability to directly communicate actionable objectives and guide behaviour in specific contexts.

By combining expressiveness, timeliness, and correctness, Chinese policy serves as a flexible and pragmatic governance tool that adapts to changing circumstances while maintaining alignment with the overarching objectives of the CPC. This unique interplay between policy and law reflects the Chinese legal system’s focus on governance and collective objectives, as opposed to the legal positivist tradition predominant in Western systems.

Policy changes in China are rarely abrupt; instead, they are gradual and contingent upon the assessment and evaluation of specific circumstances. Even in instances of strong criticism of a prior policy—such as the Great Cultural Revolution—the critique focused not on the inherent correctness of the policy itself but on a misrepresentation of reality by the CPC at that time. As the 1981 Resolution on Certain Questions in the History of Our Party since the Founding of the People’s Republic of China states, the errors of that period “represent an entirely erroneous appraisal of the prevailing class relations and political situation in the Party and state. [ …] In the last analysis, from a long-term historical point of view the mistakes and setbacks of our Party were only temporary” (Guanyu jianguo yilai dang de ruogan lishi wenti de jueyi [Resolution on certain questions in the history of our Party since the founding of the People’s Republic of China], 1981). This highlights the Party’s enduring emphasis on the correctness of its policies as a fundamental principle of its work. An illustrative example can be found in the context of the COVID-19 containment policy. Both the CPC leadership and state media, such as the Renmin Ribao (People’s Daily), consistently underscored the policy’s alignment with the principles of being “correct, scientific and effective” (正确的、科学的、有效的). The framing of policy in these terms reinforces the idea that its correctness is not only a guiding tenet but also a tool to legitimize governance decisions, even in the face of challenges or evolving circumstances (Zhongguo de fangkong zhengce kexue youxiao [China’s prevention and control policies are scientific and effective], 2023). Under the BRI, the preference for policy as the soul of the law becomes evident, often taking precedence over strictly legal considerations. Beyond the physical construction projects commonly referred to in Chinese as 建设 (“construction”), the policy planning and vision behind the initiative are of paramount importance. Although first proposed in 2013, the BRI gained specific content and prominence both within the CPC leadership and the international community in 2015 with the release of the “Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road” (Vision). The involvement of key ministries—Commerce, Foreign Affairs, and the National Development and Reform Commission—in drafting the Vision reflects a shift in perspective regarding the BRI’s role, priorities and nature. This policy document identified three core components as its backbone: foreign relations, trade and investment, and development. The BRI is a clear continuation of China’s integration into the global economy, representing both the global projection of China’s developmental model and the culmination of the economic reforms initiated by Deng Xiaoping (Vogel, Reference Vogel2011). From a conceptual standpoint, the BRI reflects China’s broader approach of combining long-term policy vision with flexible implementation to achieve strategic objectives on a global scale.

Rather than prioritizing legal cooperation, one of the five key goals of the BRI is policy coordination, described as “an important guarantee for implementing the Initiative.” This concept underscores the importance of collaborative efforts, where “countries along the Belt and Road may fully coordinate their economic development strategies and policies, develop plans and measures for regional cooperation, negotiate to resolve cooperation-related issues, and jointly provide policy support for implementing practical cooperation and large-scale projects” (Vision, § IV). The emphasis on policy coordination over legal cooperation and reform has significant implications for legal transplants under the BRI. By prioritizing policy harmonization, the framework encourages flexibility and adaptability, but it may also result in inconsistencies in the adoption and enforcement of legal standards. This approach reflects the broader Chinese governance philosophy, where policies serve as the foundation for achieving strategic goals, while legal reforms are secondary to the overarching objectives outlined in policy frameworks. To achieve policy coordination, China has extensively relied on Memoranda of Understanding (MOUs) and other non-binding agreements, which are instrumental in advancing this goal. Wang examines the BRI from a legal perspective and highlights how the use of soft law instruments, such as MOUs and performance agreements, leads to what he describes as “minimal legalization,” resulting in a lack of overall effectiveness (Wang, Reference Wang2021). Within the BRI framework, policy coordination is pursued through multilevel and multilateral dialogues at the regional level while negotiating bilaterally for the concrete implementation of projects (Farah and Rossi, Reference Farah and Rossi2011). In both instances, legal dimensions are deprioritized in favour of political and policy-driven approaches.

Examples of regional policy coordination include the Forum on China-Africa Cooperation (FOCAC) with Africa (Shelton, Reference Shelton2016; Omolo, Reference Omolo2022), the China-CEEC (Central and Eastern European Countries) Cooperation with Eastern Europe (Auer and Stiegler, Reference Auer, Stiegler and Song2017; Zuokui, Reference Zuokui2017), and initiatives involving MENA countries (Zoppolato and Jiang, Reference Zoppolato and Jiang2023). These regional meetings often serve as platforms for China to outline its commitments in broad terms. For instance, the 2018 Beijing Declaration, adopted during a FOCAC summit, introduced eight major initiatives and included a pledge of $60 billion from China to bolster Sino-African cooperation. However, the declaration lacked details regarding the allocation of funds across initiatives, the role of other China-led institutions in financing, and the establishment of monitoring or transparency mechanisms.

Substantive policy coordination, however, tends to occur not at the regional level but bilaterally and on a project-specific basis, with a political rather than legal orientation. The enforceable legal dimensions are typically confined to performance contracts between Chinese companies—whether state-owned or private entities—and host-country entities. These contracts are often confidential, as they involve private commercial arrangements. Despite the creation of institutions like the CICC to handle disputes, most contracts avoid resolution through such institutions. Instead, they adhere to international contract practices, with arbitration commonly conducted in globally recognized tribunals. Second, within the framework of the BRI, the instrumentalization of law often manifests as the subordination of legal frameworks and reforms to specific policy objectives, rather than a commitment to upholding fundamental legal principles. The approach enables laws to be adapted and interpreted to align with shifting circumstances and the power dynamics involved, effectively prioritizing political and economic goals over the rule of law. Such an approach can have significant consequences, particularly in the context of legal transplants from China, where legal standards may be circumvented to facilitate economic projects, potentially undermining legal protections.

The prioritization of political and economic considerations is particularly pronounced when Chinese legal transplants are involved. While adopting Chinese legal standards and practices can expedite project completion, it often comes at the expense of legal safeguards. This is evident in the frequent relaxation of environmental and labour protections—practices reminiscent of the extractive and neocolonial operations historically associated with Global North corporations in the Global South. However, a unique aspect of China’s approach is the exceptional treatment afforded to Chinese enterprises operating abroad, which can place them outside the standard rule of law. For instance, to achieve ambitious policy objectives, such as the construction of a massive dam involving multiple stakeholders, China’s pragmatic view of law may encourage host countries to bypass their systems of legal guarantees. This enables them to secure Chinese funding and meet policy goals, even if doing so compromises established legal standards. Such practices illustrate the tension between China’s policy-driven legal framework and the broader global expectations for transparency, accountability, and adherence to the rule of law. Third, even when host countries are neither compelled nor coerced into adopting China’s legal practices, this prioritization of the political over the juridical in the BRI framework can inadvertently lead to the replication of some of China’s authoritarian practices. While in China these practices are partially balanced by the country’s unique political framework —including intraparty competition, accountability mechanisms for CPC members, ideological constraints, and international scrutiny—the same checks and balances are often absent when host countries adopt elements of the Chinese model of governance. This dynamic has raised concerns about democratic backsliding in countries engaging closely with China. For instance, in the context of Pakistan, Hasan Karrar highlights how Chinese involvement has contributed to the weakening of normative legal and administrative structures, exacerbating governance challenges and undermining democratic principles (Karrar, Reference Karrar2022).