Soft Law, State-Owned Enterprises and Dispute Resolution on PRC’s Belt and Road — Towards an Emerging Legal Order?

The Belt and Road Initiative (BRI) is part of an ambitious national strategy to promote the PRC's economic and foreign policies to help take a larger role in global affairs. This is being implemented through PRC-centred trading and investment in infrastructure projects of countries in Asia, Europe, Oceania and Africa. The BRI is one of the largest infrastructure mega-investment projects in history. As PRC's “national champions,” state-owned enterprises (SOEs) will seek to undertake investments in infrastructure projects in the countries along the Economic Belt and Maritime Road; this is understandably being done in order to achieve economic advantages in the PRC and to demonstrate her economic and political prowess, as well as to extend her soft-power capacities. Given the considerable diversity in legal, cultural and societal conditions in the countries along this terrain, SOEs may face a more challenging environment in the governance of their companies operating abroad and in the resolution of commercial disputes arising from BRI-related investments. This article explores the use of “soft law” rules in the governance of state-owned Chinese companies and in the resolution of commercial disputes that SOEs will encounter in their investment in infrastructure projects along the BRI. We argue that reliance on soft law rules can be a pragmatic and effective means of governing SOEs operating abroad and in resolving commercial disputes arising from investment in infrastructure projects that involve SOEs in host countries