Dealing with litigation matters, client’s are often concerned with paying required “litigation fees” in China, and specifically whether these fees may be recovered. To answer this question, the first thing is to know the statutory scope of “litigation fees”. In the Measures of the Payment of Litigation Fees promulgated by State Council in Dec. 19th, 2006, there are two types of “litigation fees” recognized in China:
I. Fees paid directly to the court:
(1) Case acceptance fee;
(2) Application fee;
(3) Expenses of the witness, interpreters, etc summoned to court.
II. Fees directly paid to a neutral institution appointed by the court, like an evaluation agency, authentication institution, translation agency etc.
These litigation fees are generally paid upfront by the parties when initiating or over the course of a litigation proceeding.
The importance of clarifying the scope of litigation fees lies in the fact that in civil legal proceedings, the losing party is the party responsible for bearing these litigation fees. These fees initially should be paid by the Plaintiff or the party submitting the application, however, they are not necessarily the ones finally bearing these costs. Taking case acceptance fee as an example, after the Plaintiff submits its Pleadings, the Plaintiff is then required to pay an acceptance fee to the court. Failure to pay the acceptance fee without reason will result in a determination that the pleading had been withdrawn by the Plaintiff. After the case acceptance fee is made, and assuming the Plaintiff wins the case, the court will rule that the Defendant must pay the cost of the case acceptance fee. The court will return the case acceptance fee to the Plaintiff and the Defendant has to pay the same amount to the court. For the other kinds of litigation fees, such as evaluation fee or authentication fee which are initially paid to concerned institution, instead of the court, the court will rule the losing party directly compensate the party submitting relevant application.
The short answer: If you win the case, you’ll get the money back.
The other important point is that the attorney fee is not covered by the litigation fees, therefore if you intend to have the other party compensate the costs for engaging attorneys, it should be separately and clearly stated in your pleadings and relevant evidence should be submitted to prove the truthfulness of these costs. Unlike the litigation fees, in legal practice, normally only partial amount of the attorney fees will be accepted by the court and finally awarded to be paid by the losing party.