There are no internationally unified standards for determining the applicable law to verify the validity of arbitration agreements. However, major countries and international conventions have established and implemented various decision-making methods...
There are no internationally unified standards for determining the applicable law to verify the validity of arbitration agreements. However, major countries and international conventions have established and implemented various decision-making methods, such as the law of the arbitration seat, the governing law of the main contract, the principle of validity, and three-step rules. China, one of Korea's most important trade and investment partners, has established a hierarchical framework for determining the governing law of an arbitration agreement, which are based on china's legal provisions such as The Interpretation of Arbitration Law, The Law on the Application of Laws to Foreign-related Civil Relations and its judicial interpretation, and The Provisions on Judicial Review, prioritizing the following in sequence: (1) the law agreed upon by the parties, (2) the law of the seat of the arbitration institution or the law of the arbitration venue—whichever effectively recognizes the validity of the arbitration agreement, and (3) the law of the court's jurisdiction. This study analyzes how Chinese courts apply the aforementioned criteria for determining the governing law of arbitration agreements in relevant cases. Through this analysis, the study highlights key challenges in the application of governing law when assessing the validity of arbitration agreements and provides practical recommendations for addressing these issues in operational contexts in China. Finally, it aims to present precautions that can prevent Korean parties who enter into arbitration agreements with Chinese parties, from being exposed to unnecessary legal disputes related to the governing law of arbitration agreements.