China & Indian Jurisdiction

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Overview

When Chinese Business Meets Indian Jurisdiction

India-China legal touchpoints are shaped less by shared diaspora concerns and more by trade, manufacturing, investment regulation, and intellectual property enforcement. China is not notified as a reciprocating territory under Section 44A CPC, so Chinese court judgments cannot be directly executed in India — a fresh suit is required. Since 2020, investment flowing from China into Indian companies is also subject to a distinct government-approval regime that does not apply to most other countries. This page covers the Indian law dimension of matters with a China connection.

Common Matters

Where Indian Law Becomes Relevant

Enforcement of Chinese Judgments in India

China is not a reciprocating territory under Section 44A CPC. A judgment from a Chinese court cannot be directly executed in India — a fresh suit must be filed under Section 13 CPC, using the Chinese judgment as evidence of the underlying claim.

FDI From China — Press Note 3 Approval Requirement

Under Press Note 3 of 2020, any investment from an entity based in a country sharing a land border with India — which includes China — requires prior Government of India approval, regardless of sector or investment size, unlike the automatic route available to investors from most other countries. This significantly affects Chinese equity investment, follow-on funding rounds, and M&A involving Chinese-linked capital into Indian companies.

Arbitration and Enforcement of Chinese Awards

China is a New York Convention signatory, and CIETAC-administered awards are enforceable in India under Part II of the Arbitration and Conciliation Act, 1996. In practice, India-China commercial contracts frequently specify a neutral seat — Hong Kong or Singapore — rather than mainland China or India, given enforcement and procedural considerations on both sides.

Trademark and Counterfeit Goods Enforcement

A significant share of counterfeit and trademark-infringing goods entering the Indian market originates from Chinese manufacturers. Indian rights holders rely on the Trade Marks Act, 1999, the Customs Act, 1962, and the Intellectual Property Rights (Imported Goods) Enforcement Rules to record trademarks with Indian Customs and intercept infringing shipments at the border.

Manufacturing and Supply Chain Contract Disputes

Indian businesses sourcing from Chinese manufacturers commonly face quality, delivery, and force majeure disputes under the underlying sale of goods contract. Choice-of-law and forum clauses drafted at the outset materially affect whether a dispute is resolved through Indian courts, Chinese courts, or arbitration.

FEMA, ODI, and Taxation

Indian businesses with outbound investment into China, or Chinese-linked structures requiring FEMA compliance, must navigate the Overseas Direct Investment framework alongside the heightened scrutiny applicable to China-linked capital. The India-China Double Taxation Avoidance Agreement governs the allocation of taxing rights on cross-border income.

Legal Framework

Statutes on Both Sides

Indian Statutes

Code of Civil Procedure, 1908 — Sections 13, 14 (China not a reciprocating territory)
Consolidated FDI Policy — Press Note 3 of 2020 (land-border country approval requirement)
Foreign Exchange Management Act, 1999 — ODI framework
Arbitration and Conciliation Act, 1996 — Part II, New York Convention awards
Trade Marks Act, 1999
Customs Act, 1962 — IPR (Imported Goods) Enforcement Rules
Income Tax Act, 1961 — DTAA India-China

Chinese Statutes

Civil Procedure Law of the PRC — cross-border judgment recognition
Foreign Investment Law of the PRC (2020)
Arbitration Law of the PRC / CIETAC Arbitration Rules
Trademark Law of the PRC
Company Law of the PRC

Notice to Visitors

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