Amicus Curiae Brief — Animal Sci. Prods., Inc. v. Hebei Welcome Pharm. Co., 137 S. Ct. 2320 (2017) (No. 16-1220)

No. 16-1220

IN THE

Supreme Court of the United States

ANIMAL SCIENCE PRODUCTS, INC., et ai.,

Petitioners,

Vv.

HEBEI WELCOME PHARMACEUTICAL CoO, LTD., et al.,

Respondents.

On Writ of Certiorari

to the United States Court of Appeals

for the Second Circuit

BRIEF OF AMICUS CURIAE MINISTRY OF

COMMERCE OF THE PEOPLE’S REPUBLIC

OF CHINA IN SUPPORT OF RESPONDENTS

JOEL M. MITNICK CARTER G. PHILLIPS*

SIDLEY AUSTIN LLP KWAKU A. AKOWUAH

787 Seventh Avenue TOBIAS 8S, LOSS-EATON

New York, NY 10019 MACKENZI SIEBERT

(212) 839-5300 SIDLEY AUSTIN LLP

1501 K Street, N.W.

Washington, D.C. 20005

(202) 736-8000

cphillips@sidley.com

Counsel for Amicus Curiae Ministry of Commerce

of the People’s Republic of China

April 4, 2018 * Counsel of Record

a AT SO EEA LEDS

QUESTION PRESENTED

Where a foreign government appears in a U.S. court

to explain the meaning of its own law, should the court

defer to the foreign sovereign’s reasonable interpreta-

tion of that law?

(i)

TABLE OF CONTENTS

Page

QUESTION PRESENTED .....................cccceeeeseeeees i

TABLE OF AUTHORITIES ..................cc:.seeceeeeees v

INTEREST OF AMICUS CURIAE..................0004. 1

SUMMARY OF ARGUMENT ....00.0...........00.c0ece0ee 3

I. THE SECOND CIRCUIT CORRECTLY

I.

HELD THAT A U.S. COURT IS BOUND TO

DEFER TO A FOREIGN SOVEREIGN’S

REASONABLE EXPLANATION OF ITS

THE COURT OF APPEALS CORRECTLY

DEFERRED TO THE MINISTRY'S REA-

SONABLE EXPLANATION OF CHINESE

EETIIES ccncaventitcsneniircssnnpodimnnnennaninnmnneasnnnanis 8

I.

Il.

U.S. COURTS ARE BOUND TO DEFER TO

A FOREIGN SOVEREIGN’S REASONA-

BLE EXPLANATION OF ITS OWN LAW... 8

A. Pink Held That A Foreign Sovereign’s Ex-

planation Of Its Own Law Is Conclusive . 8

B. Deference Serves The Interests of Accu-

racy and International Comity................. 15

C. Neither Rule 44.1 Nor Domestic Defer-

ence Doctrines Are Relevant Here ........... 20

D. The Solicitor General’s Position Is Hope-

lessly Indeterminate .....................cecse0e0ees 22

THE COURT OF APPEALS CORRECTLY

DEFERRED TO THE MINISTRY'S REA-

SONABLE INTERPRETATION OF CHI-

iv

A. The Second Circuit Properly Determined

That The Ministry's Explanation Of Chi-

nese Law Was Reasonable .......................

B. The Ministry’s Authority To Interpret Its

Own Rules Is Beyond Dispute .................

IEEE etesiceesanssunesqusccinnsventsasesenetinninnivaniicieds

Vv

TABLE OF AUTHORITIES

CASES Page

Abbott v. Abbott, 560 U.S. 1 (2010)............... 12

Access Telecom, Inc. v. MCI Telecomms.

Corp., 197 F.3d 694 (5th Cir. 1999).......... 13, 17

Bader v. Kramer, 484 F.3d 666 (4th Cir.

I ictesititacial coal dactilen ihe taleaal ata haan aeeaaigis 16

Bodum USA, Inc. v. La Cafetiere, Inc., 621

F.3d 624 (7th Cir. 2010)............ccccceccccseceses 15

Encino Motorcars, LLC vy. Navarro, 136

<< 6 RESIS lt SE 21

First Nat’ City Bank v. Banco Para el

Comercio Exterior de Cuba, 462 U.S. 611

(1983), superseded by statute on other

grounds, National Defense Authorization

Act for FY 2008, Pub. L. No. 110-181, 122

Stat. 3, as recognized in Rubin v. Islamic

Republic of Iran, 138 S. Ct. 816 (2018) ..... 20

Fremont v. United States, 58 U.S. (17 How.)

III sicasainsrnstenhcecheacnaienpiiinsieniioneindinanttonts 11

Hartford Fire Ins. Co. v. California, 509 U.S.

EFS A SIE ES/SCceeaeee nn ee eee 12

J.P. Morgan Chase Bank v. Traffic Stream

(BVI) Infrastructure Lid., 536 U.S. 88

TTT atiinidbeaniiashintananmmnidetanianinabamniainindasiiniinnes 12

Lexmark Int'l, Inc. v. Static Control Compo-

nents, Inc., 134 S. Ct. 1377 (2014)............. 23

McDermott Int'l, Inc. v. Wilander, 498 U.S.

AIT niiscinabeespncnesunesdinpesisnaleiieintinbeiatidiiasions 21

McKesson HBOC, Inc. v. Islamic Republic of

Iran, 271 F.3d 1101 (D.C. Cir. 2001)......... 14

Moscow Fire Ins. Co. v. Bank of N.Y. & Tr.

Co., 294 N.Y.S. 648 (N.Y. Sup. Ct.

REESE SESS See eA ACR is OW Bere y

vi

TABLE OF AUTHORITIES—continued

Page

Moscow Fire Ins. Co. v. Bank of N.Y. & Tr.

Co., 20 N.E.2d 758 (N.Y. 1939), affd by an

equally divided court, 309 U.S. 624

UIT initertipatniedatntinciaisiciciundaiasiidsidiedaiadmmanns gy

In re Oil Spill by the Amoco Cadiz, 954 F.2d

RE EID. HIIIEID canenccineccucenscceidibecesses passim

OBB Personenverkehr AG vy. Sachs, 136

88 Ee 10

Richmark Corp. v. Timber Falling Consult-

ants, 959 F.2d 1468 (9th Cir. 1992).......... 13, 21

RJR Nabisco v. European Cmty., 136 S. Ct.

PETTITTE icsiicteceindeussieisininitenidiiidabndiinincianiapenaens 18

United States v. McNab, 331 F.3d 1228 (11th

Enh Ieee icincishncbiensenbseintiinsiiseniiestbutiedsh 13, 14, 15

United States v. Pink, 315 U.S. 203

SE ichesivpinseenserninsantimichatapeanebiatampneiednennes passim

Whallon v. Lynn, 230 F.3d 450 (ist Cir.

iii scsisasishatidentiphicsinslindsteatatnmemmsiatiacanmsiagieeentiaieatin 16

Zschernig v. Miller, 389 U.S. 429 (1968)...... 18

RULE

Sees Sis TNL TD WOU ictcininpioerentececepneeedtounialdennees 20

FOREIGN STATUTES

Foreign Trade Law (promulgated by the

Standing Comm. Nat'l People’s Cong.,

May 12, 1994, revised Apr. 6, 2004),

https://goo.gW/sHn37U .................cccceeeeeeeeees 32

Decree of the State Council of the People’s

Republic of China (No. 322), Regulations

on Procedures for the Formulation of

Rules (effective Jan. 1, 2002)..................... 33

vil

TABLE OF AUTHORITIES—continued

SCHOLARLY AUTHORITY Page

Kristen E. Eichensehr, Foreign Sovereigns

As Friends of the Court, 102 Va. L. Rev.

289 (2016)

INTERNATIONAL AUTHORITIES

First Written Submission of the United

States of America, China—Measures Re-

lated To The Exportation Of Various Raw

Materials, WT/DS394/DS395/DS398 (June

1, 2010), https://goo.gl/95Qiwyv .................. 31

Opening Oral Statement of the Complain-

ants, China—Measures Related to the Ex-

portation of Various Raw Materials,

WT/DS364/DS395/DS398 (Aug. 31, 2010),

https://goo.gl/GqkcpB................ccccceceeeeeeeeeee 31

Panel Report, United States — Sections 301-

310 of the Trade Act of 1974, WTO Doc.

WT/DS152/R (adopted Jan. 27, 2000),

https://www.wto.org/english/tratop_e/

dispu_e/wtds152r. pdf ....................ccceeeeeee eee 23

Second Written Submission of the United

States, United States — Section 129(c)(1) of

the Uruguay Round Agreements Act,

WT/DS221 (Mar. 8, 2002), https://goo.gl/

TEIIIINE vsintaiclentnminthnsmcnniisaganssananinideigiannbaaiietin 23

WTO, Trade Policy Review: People’s Repub-

lic of China, WT/TPR/S/161 (Feb. 28,

2006), https://goo.g!//iPtMaZ....................... 30

INTEREST OF AMICUS CURIAE'

Amicus Ministry of Commerce of the People’s Repub-

lic of China (the “Ministry,” sometimes called

MOFCOM) is a component of the central Chinese gov-

ernment and the highest administrative authority in

China authorized to regulate foreign trade. The Min-

istry is the equivalent of a U.S. cabinet-level depart-

ment. Chinese law places the Ministry in charge of for-

eign trade throughout the country. The Ministry ac-

cordingly formulates strategies, guidelines, and poli-

cies concerning domestic and foreign trade and inter-

national cooperation. It also drafts and enforces trade

laws and regulations, and regulates markets. And

contrary to Petitioners’ groundless suggestion, the

Ministry’s authority to interpret the regulations at is-

sue here was established below and is incontestable.

The Ministry has been actively ir ©’ ed in this liti-

gation since 2005. It first presented ..e Chinese gov-

ernment’s authoritative interpretation of Chinese law

in 2006, when it filed an amicus brief in the district

court. It reaffirmed its position in supplemental sub-

missions to the district court in 2008 and 2009, and in

an amicus brief in the court of appeals in 2014. As both

courts below observed, this was “historic.” Pet. App.

6a. Never before had “any entity of the Chinese Gov-

ernment ... appeared amicus curiae before any U.S.

court.” Id. at 6a n.5.

The Ministry’s submissions explained the Chinese

trade regulations that, at relevant times (2002—2005),

required the defendant companies to coordinate their

' No counsel for any party authored this brief in whole or in

part, and no other entity or person made any monetary contribu-

tion toward the preparation and submission of this brief. The

parties have consenting to the filing of this brief.

2

export activities. China further made clear, in a 2014

diplomatic note to the State Department, that the Min-

istry spoke for the Chinese Government in this litiga-

tion.

Unfortunately, the Ministry’s efforts to assist the

district court in understanding the meaning of its reg-

ulations, including b’ explaining the economic, cul-

tural, linguistic, and legal context in which those reg-

ulations were created, were treated with open suspi-

cion and hostility. The district court even asserted

that the Ministry’s submissions reflected “a post-hoc

attempt to shield defendants’ conduct from antitrust

scrutiny.” Pet. App. 12la. Petitioners and some of

their amici have continued that smear campaign here.

These accusations are profoundly disrespectful and

wholly unjustified. As the Second Circuit explained,

the reasons the district court gave for disparaging the

Ministry’s submissions were ill-considered and at

points “nonsensical.” Pet. App. 27a. Consistent with

its obligation to review de novo the district court’s for-

eign-law determination, the Second Circuit re-exam-

ined the Ministry’s interpretation, found it “reasona-

ble,” and therefore deferred to it. Jd. The Ministry

respectfully submits that the Second Circuit’s ap-

proach and conclusions are correct. A contrary result

would signal to private parties that they should follow

Petitioners’ lead and disparage the competence and

motives of foreign sovereigns who appear in U.S.

courts. It would likewise signal to foreign sovereigns

that their interpretations of their own laws will not be

respected here. Those signals would seriously disserve

the interests of accurate adjudication and interna-

tional comity, to the detriment of courts, regulators,

and regulated parties around the world.

3

SUMMARY OF ARGUMENT

I. THE SECOND CIRCUIT CORRECTLY HELD

THAT A U.S. COURT IS BOUND TO DEFER

TO A FOREIGN SOVEREIGN’S REASONA-

BLE EXPLANATION OF ITS OWN LAW.

A. United States v. Pink held that a foreign sover-

eign’s official interpretation of its law, offered for use

in U.S. litigation, is “conclusive.” 315 U.S. 203, 218-

20 (1942). Pink’s holding is not narrowly confined to

its facts; instead, as the United States previously told

this Court, Pink established that “American courts are

obligated to accept [a foreign sovereign’s legal] state-

ment at face value” unless it is facially ambiguous, in-

consistent, or incredible. Br. of United States as Ami-

cus Curiae at 23, Matsushita Elec. Indus. Co. v. Zenith

Radio Corp., 475 U.S. 574 (1985) (No. 83-2004)

(Matsushita U.S. Br.). In Pink, it was enough that

some evidence supported the foreign sovereign’s inter-

pretation, even though the New York courts had held

that the voluminous record as a whole supported a dif-

ferent interpretation.

This Court’s other decisions have similarly relied on

foreign governments’ explanations of their own law,

submitted (as here) through amicus briefs. The courts

of appeals, too, have consistently recognized that def-

erence is warranted to a foreign government’s plausi-

ble interpretation of its own laws. They have thus de-

clined to defer where a foreign governmental body does

not appear before the court or its interpretive author-

ity is unclear, or where deferring to a changed inter-

pretation on appeal would disturb the finality of the

judgment. Nothing of the kind occurred here. The

Ministry presented a single, unchanging position

throughout this litigation.

4

B. Deference enhances the accuracy of U.S. courts’

foreign-law determinations. The tools, doctrines, and

intuitions that serve American judges so well in inter-

preting U.S. law are frequently unhelpful or even mis-

leading when it comes to foreign law. Plain-language

analysis of translated materials is treacherous, and

may not accord with foreign interpretive principles.

Secondary sources may not exist in English. And ex-

pert testimony frequently comes with a partisan spin.

Accordingly, it is only logical to regard a foreign sov-

ereign’s official and reasonable interpretation of its

own law as “conclusive.” The district court’s analysis

here vividly illustrates the dangers of a contrary ap-

proach; the court attempted to decipher the “plain lan-

guage” of translated regulations, overlooking that Chi-

nese regulatory regimes rely heavily on other types of

material and use terms that might seem ambiguous or

euphemistic to an English-speaker schooled only in

American law. This misguided approach led the dis-

trict court to accuse the Chinese government of at-

tempting to mislead the court, understandably

prompting a diplomatic protest.

Petitioners and the Solicitor General suggest that

foreign governments may mislead U.S. courts to pro-

tect foreign interests, but they can identify no example

of that happening in this Court or any other. Notably,

the Ministry adhered to its interpretation here even

when the United States (among others) used the Min-

istry’s submissions in this case to support its claims

that China’s trade practices violated WTO standards.

That occurrence illustrates why foreign sovereigns are

unlikely to espouse positions in U.S. courts they do not

believe. The positions they take here, in public filings,

will have consequences in domestic settings and

around the world.

o

Deference is also critical to international comity. Re-

jecting a foreign sovereign’s explanation of its own law

can imply only two things: that a U.S. court knows a

country’s laws better than its own government, or that

the foreign government is not being candid. Both are

profoundly disrespectful. The Court should not adopt

a rule that encourages litigants to accuse foreign gov-

ernments of incompetence or deceit, and encourages

courts to reject foreign sovereign’s views in precisely

those cases that are important enough for them to par-

ticipate directly.

C. Federal Rule of Civil Procedure 44.1 did not dis-

card the rule of deference to foreign sovereigns. As the

Solicitor General correctly acknowledges, there is no

conflict between a rule of deference and Rule 44.1’s

text. Nor is there a conflict with Rule 44.1’s goals of

(a) making for ign-law determinations questions of

law, not fact, and (b) removing limitations on the ma-

terials a court can consider. In domestic contexts,

courts regularly grant deference on questions of law,

and consider extrinsic materials in applying deference

doctrines. So too here.

Although the parties agree that domestic deference

doctrines should not be transplanted wholesale into

the foreign-law context, analogies may be illuminat-

ing. Like the Seventh Circuit, the Ministry believes it

would be inappropriate for courts to afford greater def-

erence to executive-agency interpretations of domestic

statutes than to foreign government interpretations of

foreign law. When U.S. courts decline to defer to a for-

eign sovereign’s interpretation of foreign law. they risk

applying a rule that has never before existec and ap-

plies to no one else, thereby imposing conflicting legal

obligations on the parties before them. And they risk

international discord as a result.

6

D. The Solicitor General’s newly minted standard—

in which any number of “circumstances” dictate the

amount of deference due, if any—will not aid courts in

resolving difficult issues of foreign law, and will not

serve the interests of comity. Indeed, although the So-

licitor General asserts that his approach will “ordinar-

ily” afford “substantial weight” to a foreign govern-

ment’s interpretation, that assurance is impossible to

square with his position that a court should resolve “a

disputed question of foreign law ... in the same man-

ner as a court facing any other unsettled legal ques-

tion.” The Court should not adopt that unprecedented

approach.

Il. THE COURT OF APPEALS CORRECTLY

DEFERRED TO THE MINISTRY’S REASON-

ABLE EXPLANATION OF CHINESE LAW.

A. The Second Circuit carefully examined the Min-

istry’s submissions in context and in light of underly-

ing materials. It also carefully explained the district

court’s key analytical errors—which together pro-

duced a “nonsensical” reading of Chinese law. Yet Pe-

titioners claim the Second Circuit blindly deferred to

the Ministry and but for that deference, the Second

Circuit would have embraced the district court’s con-

struction. That is a strawman—the Second Circuit

said nothing of the kind.

The district court’s criticisms of the Ministry’s posi-

tion were unfounded. The Ministry provided a clear,

detailed, and cohesive interpretation of relevant Chi-

nese law. The district court appeared troubled that

aspects of the regulatory system were not fully spelled

out in positive enactments, but that is typical of Chi-

nese law. Nor did the Ministry fail to distinguish be-

tween the 1997 and 2002 regulatory regimes; rather,

it carefully explained that the later regime rested on

7

the same basic concept as the earlier one, but was im-

plemented differently.

The Ministry’s position here is also fully consistent

with China’s statements to the WTO. Those state-

ments referred to the pre-2002 system of export quotas

and licenses, but not to mechanisms such as the veri-

fication-and-chop system, pursuant to which (before

2008) certain chambers of commerce were granted im-

plementing authority to ccordinate export prices, and

thereby minimize export dumping issues that Chinese

manufacturers might encounter. Indeed, the United

States later invoked the Ministry’s filings in this very

case to argue to the WTO that China controlled export

prices in precisely this way, including during the

2002-2005 period, and the WTO agreed. The district

court simply misread China’s reference to “export ad-

ministration,” giving that term a construction never

adopted by the trade specialists in the WTO proceed-

ings—an error Petitioners repeat here.

B. There is no merit to the suggestion that the Min-

istry lacks authority to interpret the regulatory mate-

rials at issue. In 2001, China’s State Council promul-

gated rulemaking procedures that empower the Min-

istry (and other Chinese agencies) to make and inter-

pret its own regulations. The Ministry exercised that

authority and, moreover, speaks for the People’s Re-

public of China here.

8

ARGUMENT

I. U.S. COURTS ARE BOUND TO DEFER TO A

FOREIGN SOVEREIGN’S REASONABLE

EXPLANATION OF ITS OWN LAW.

A. Pink Held That A Foreign Sovereign’s

Explanation Of Its Own Law Is Conclu-

sive.

This Court has already held, on materially indistin-

guishable facts, that a foreign government’s explana-

tion of its own law, provided for use in U.S. litigation,

is “conclusive.” Pink, 315 U.S. at 218-20. That hold-

ing, which the Second Circuit followed below, is fully

supported by other decisions of this Court and the

courts of appeals, and should be sustained.

1. Pink held that an official Soviet declaration ex-

plaining the “intended effect of the Russian decree na-

tionalizing [Russian] insurance companies” after the

Russian Revolution was “conclusive” of the decree’s

meaning under Russian law. Jd. at 218-20 (footnote

omitted). As the Solicitor General previously told this

Court, Pink establishes that “[o]nce a foreign govern-

ment presents a statement dealing with subjects

within its area of sovereign authority ... American

courts are obligated to accept that statement at face

value; the [foreign] government’s assertions concern-

ing the existence and meaning of its domestic law gen-

erally should be deemed ‘conclusive.” Matsushita U.S.

Br. at 23 (quoting Pink, 315 U.S. at 220). Only

“(p}lainly ambiguous,” “internally inconsistent,” or fa-

cially “incredible” assertions do not warrant deference.

Id.

The Solicitor General has now flipped positions and,

like Petitioners, argues that Pink turned on “unusual”

and distinguishable facts. SG Br. 27-29; Pet. Br. 39—

41. They arvue that (i) “a wealth of record evidence ...

9

confirmed” the Soviet interpretation; (ii) the interpre-

tation came “in response to an explicit invitation from

the U.S. Executive Branch”; and (iii) this Court first

found “that the Commissariat had power to interpret

Russian law.” Pet. Br. 41. These claims are unavail-

ing.

First, Petitioners and the Solicitor General misun-

derstand the facts of Pink. The New York courts had

held—based on expert testimony, government docu-

ments, court decisions, and academic writings, see

Moscow Fire Ins. Co. v. Bank of N.Y. & Tr. Co., 294

N.Y.S. 648, 683 (N.Y. Sup. Ct. 1937)—that the nation-

alization decrees “were not intended to have effect

here.” Moscow Fire Ins. Co. v. Bank of N.Y. & Tr. Co.,

20 N.E.2d 758, 767 (N.Y. 1939), affd by an equally di-

vided court, 309 U.S. 624 (1940). “Subsequently to the

hearings in that case,” the United States obtained and

submitted the official Soviet declaration. Pink, 315

U.S. at 218. When the issue arose again in Pink, on

the same record, id. at 216—17, this Court deemed the

declaration “conclusive.” It did so even though the dec-

laration contradicted the New York courts’ holdings

based on “all the evidence in the voluminous record,”

which this Court “d[id] not stop to review.” /d. at 218.

Thus, Pink did not defer to the Soviet declaration be-

cause it was supported by the entire record (Pet. Br.

41; SG Br. 10—11, 28~—29); it deferred even though the

lower courts thought the record, on balance, supported

the opposite conclusion.

Second, although U.S. courts previously obtained

foreign legal interpretations “through official diplo-

matic channels” (SG Br. 28; Pet. Br. 41), that practice

was discontinued 40 years ago at this Court’s sugges-

tion, with the State Department’s concurrence. See

Kristen E. Eichensehr, Foreign Sovereigns As Friends

10

of the Court, 102 Va. L. Rev. 289, 299 (2016). “[Fjor-

eign governments [now] communicate their views to

the judicial branch through... the filing of formal

briefs,” id., as the Ministry did here.?

Moreover, China did act through diplomatic chan-

nels. After the district court ruled, the Chinese Em-

bassy sent a diplomatic note to the State Department

highlighting that “China has attached great im-

portance to this case” and reiterating that the Minis-

try’s submissions had correctly “described China’s

compulsory requirements concerning vitamin C ex-

ports.” JA782—84. That note was before the Second

Circuit, just as the Soviet declaration was before the

New York courts in Pink. 315 U.S. at 220.

Third, Petitioners now contend (at 42—43) that Pink

turned on a “threshold” finding that the Soviet decla-

ration was issued pursuant to the Commissariat’s

power to interpret law, and that the Ministry has not

shown equivalent authority here. But insofar as the

lower courts made no such formal finding, that is be-

cause Petitioners never raised this point below. See

OBB Personenverkehr AG v. Sachs, 136 8. Ct. 390, 398

(2015) (“Absent unusual circumstances ... we wil! not

entertain arguments not made below.”). Regardless,

MOFCOM'’s power to authoritatively interpret the reg-

ulatory materials at issue here is confirmed by the rec-

ord, by the diplomatic note, and by Chinese statutory

law. See infra p. 32.

This case is on all fours with Pink. In both cases, a

foreign governmental department issued a statement

for use in U.S. litigation regarding the specific issue

2 Nor was the Soviet interpretation “akin to” a certified ques

tion to a state high court because it was obtained diplomatically.

SG Br. 28. Certified questions are issued by courts; the Pink dec-

laration was obtained by the United States, a litigant.

11

being litigated; its authority to speak on behalf of the

foreign nation was beyond dispute; and there was

other evidence of foreign law whose import was dis-

puted. The Second Circuit correctly followed Pink by

deferring to the Ministry’s reasonable interpretation of

the rules that the Ministry and the relevant chamber

of commerce (acting under the Ministry’s direction)

made, implemented, and enforced.

2. Contrary to Petitioners’ (at 29) and the Solicitor

General’s (at 20—21) claims, Fremont v. United States

further supports deference here. 58 U.S. (17 How.) 542

(1854). Fremont concerned the validity of a claimant's

title to California land, arising from a pre-annexation

grant by the Mexican government. The court noted

that in similar cases it had considered a variety of

sources to determine foreign law. Jd. at 557. There

was no question of deference because no official foreign

interpretation was proffered. The Court emphasized,

however, that it “could not, without doing injustice to

individuals, give to the Mexican laws a more narrow

and strict construction than they received from the

Mexican authorities who were intrusted with their exe-

cution.” Id. at 561 (emphasis added). The Court thus

declined to impose preconditions to the vesting of title

that Mexican “regulations for granting lands” seemed

to require, because title “would have been regarded as

vested and valid by the Mexican authorities” regard-

less. Id. at 561-62. Fremont thus demonstrates this

Court’s practice of accepting a foreign government's

understanding of foreign law even where a U.S. court

writing on a blank slate might reach a different con-

clusion.

3. This Court’s more recent decisions have similarly

relied on foreign governments’ explanations of their

own law. In Hartford Fire Insurance Co. v. California,

12

this Court (while disagreeing with the United King-

dom’s ultimate policy recommendation) accepted at

face value the United Kingdom’s explanation of what

British antitrust law did and did not require. 509 U.S.

764, 798-99 (1993). Similarly, /PMorgan Chase Bank

v. Traffic Stream (BVI) Infrastructure Ltd. relied on

“the United Kingdom’s own filings” and diplomatic

notes to establish the “United Kingdom|’s] ... author-

ity over the BVI’s statutory law,” and thus the citizen-

ship of BVI corporations. 536 U.S. 88, 96-97 (2002).

And Abbott v. Abbott relied on “a Chilean agency|’s]”

explanation to hold that Chilean law created a “joint”

or “shared” right to determine a child’s place of resi-

dence. 560 U.S. 1, 10 (2010).

Even now, this Court has amicus briefs before it in

United States v. Microsoft from several foreign author-

ities, making arguments based on foreign law. £.g.,

European Commission Br. at 8-16, United States v.

Microsoft, No. 17-2 (Dec. 13, 2017); U.K. Gov't Br. at

5-6, id. These authorities are surely interested in the

case’s outcome and effects on their citizens. But no one

would think these submissions should be disregarded

because of those interests, or on the theory that U.S.

courts better understand European privacy law or

British surveillance powers.

4. Though they have used varying formulations, the

courts of appeals have consistently concluded that

strong deference to appearing foreign sovereigns’ offi-

cial interpretations of foreign law is warranted.

In In re Oil Spill by the Amoco Cadiz, France was a

plaintiff seeking recovery from Amoco for a massive oil

spill; a key issue was whether a French statute im-

posed liability for the clean-up costs at issue. 954 F.2d

1279, 1289, 1311 (7th Cir. 1992) (per curiam). The

statute was not clear, and “[ejach side presented an

expert of the highest skill and repute.” /d. at 1312. It

13

was enough, however, that France’s interpretation

was “plausible”: “A court of the United States owes

substantial deference to the construction France

places on its domestic law.” Jd. The Seventh Circuit

thus declined to “decide whether [France’s] under-

standing of the law is correct,” and deferred to it. Jd.

In Access Telecom, Inc. v. MCI Telecommunications

Corp., the Fifth Circuit generally embraced Amoco Ca-

diz’s approach. 197 F.3d 694, 714 (5th Cir. 1999). It

nonetheless declined to follow the guidance stated in a

Mexican government circular because the Mexican

agency was “not before the court”; its interpretive au-

thority was unclear; and “|mjore importantly” the cir-

cular pre-dated a significant change in law. /d.

In Richmark Corp. v. Timber Falling Consultants,

the defendant, a company incorporated in China and

“an arm of the PRC government,” resisted discovery

because its financial information “was classified a

state secret.” 959 F.2d 1468, 1471—72 (9th Cir. 1992).

The company produced a letter from the “arm of the

State Council ... in charge of overseeing [its] opera-

tions” confirming this interpretation. Jd. at 1472. The

Ninth Circuit “acceptied] as valid the [Chinese] letter

interpreting the State Secrets Act,” explaining that a

U.S. court has “neither the power nor the expertise to

determine for ourselves what PRC law is.” Jd. at 1474

& n.7. The court then balanced China’s “admitted in-

terest in secrecy” against the plaintiffs’ interests in

disclosure to determine whether discovery was appro-

priate under U.S. law. Id. at 1474.

United States v. McNab, which Petitioners and the

Solicitor General invoke, is more about finality than

deference. 331 F.3d 1228 (11th Cir. 2003). The de-

fendants were prosecuted under the Lacey Act for im-

porting lobsters taken in violation of Honduran law.

Id. at 1232. “Throughout the investigation and trial ...

14

both the government and the district court relied upon

the Honduran officials’ verification of the Honduran

laws.” Id. The Eleventh Circuit said the district court

correctly deferred to that initial interpretation:

“Among the most logical sources for the court to look

to in its determination of foreign law are the foreign

officials charged with enforcing the laws of their coun-

try.... The court reasonably may assume that state-

ments from foreign officials are a reliable and accurate

source ....” Id. at 1241. On appeal, however, Hondu-

ras filed a brief that the panel majority described as

asserting for the first time that the Honduran regula-

tions were invalid or had been retroactively repealed.

Id. at 1240 & n.23.8 The court declined to upset the

convictions on this basis, ruling that it would not sub-

stitute deference for the first opinion with deference

for the second because there “must be some finality

with representations of foreign law.” Jd. at 1241 &

n.25. Here, the Ministry’s position has never varied.

In McKesson HBOC, Inc. v. Islamic Republic of Iran

(Pet. Br. 32; SG Br. 19), no instrumentality of the Ira-

nian government offered an official interpretation of

Iranian law, and deference was never invoked. 271

F.3d 1101 (D.C. Cir. 2001). Rather, the meaning of

Iranian law was litigated through expert testimony.

Id. at 1108—09. Thus, when the D.C. Circuit concluded

that lran’s evidence did not establish the categorical

legal rule lran’s U.S. counsel asserted, it was not re-

fusing to defer to an official interpretation; it merely

refused to credit a party’s experts. Jd. at 1109; see Pet.

for Certiorari at 24—25, Islamic Republic of Iran v.

McKesson HBOC, Inc., 537 U.S. 941 (2002) (No. 01-

5 A dissent contended that the appellate amicus brief was the

only official governmental statement presented. 331 F.3d at

1247.

15

1521) (arguing Iran was entitled to summary judg-

ment because its experts’ “affidavits and legal opin-

ions” were “unrebutted”).

B. Deference Serves The Interests of Accu-

racy and International Comity.

Deference serves two crucial values: (1) it enhances

the accuracy of the resulting legal determination, and

(2) it furthers international comity. And deference

does not surrender U.S. prerogatives to foreign na-

tions. As Pink emphasized, whether foreign law

should supply all or part of the rule of decision is a do-

mestic-law matter. 315 U.S. at 221. The United

States is free, for example, to establish endangered-

species protections that do not incorporate foreign law.

Cf. McNab, 331 F.3d at 1236. But where the laws of

the United States do incorporate foreign-law stand-

ards, its courts should defer, in all but the most ex-

traordinary cases, to a foreign sovereign’s official in-

terpretation of those standards.

1. Deference enhances accuracy. U.S. judges are

“likely to miss nuances in the foreign law, to fail to ap-

preciate the way in which one branch of the other

country’s law interacts with another, or to assume er-

roneously that the foreign law mirrors U.S. law when

it does not.” Bodum USA, Inc. v. La Cafetiere, Inc., 621

F.3d 624, 638-39 (7th Cir. 2010) (Wood, J., concur-

ring). Some foreign laws will be the subject of analysis

and explanation in English-language materials, but

many others will not. Parties can offer expert testi-

mony, but that is expensive and often “adds an adver-

sary’s spin.” /d. at 629 (majority op.). It is thus “logi-

cal” to defer to a foreign sovereign’s statements, which

a “court reasonably may assume ... are a reliable and

accurate source.” McNab, 331 F.3d at 1241. And defer-

ence is “particularly important” where there are “stark

16

difierences” between the foreign and U.S. legal sys-

tems. Pet. App. 29a.

Petitioners repeatedly invoke the need for accuracy

(at 27-33), but ignore the risk that a weak or indeter-

minate deference rule will leave U.S. judges prone to

fall back on familiar American legal doctrines or intu-

itions that may be an unreliable compass in foreign

waters. See Bader v. Kramer, 484 F.3d 666, 670 (4th

Cir. 2007) (reliance on the “plain and ordinary mean-

ing” of foreign law is “problematic” because it can pro-

duce a conclusion “divorced from that term’s meaning

in the law of the [foreign] country”); Whalion v. Lynn,

230 F.3d 450, 456 (1st Cir. 2000) (“Care must be taken

to avoid imposing American legal concepts onto an-

other legal culture.”).

The district court’s analysis here illustrates these

perils. The “Chinese legal- and economic-regulatory

system” is “unique and complex”: “[T]he Chinese gov-

ernment [] frequently governs by regulations promul-

gated by various ministries”; “private citizens or com-

panies may be authorized under Chinese regulations

to act in certain circumstances as government agents’;

and “an interpretation suggested by the plain lan-

guage of a governmental directive may not accurately

reflect Chinese law.” Pet. App. 29a (omission in origi-

nal). And Petitioners offered no expert evidence sup-

porting their interpretation. Jd. at 59a n.5.

The district court thus embarked on a solo mission

to interpret the Chinese regulatory regime. It rejected

the expert testimony offered by Respondents, and de-

clined to hear argument from any party at summary

judgment. It then pursued a “plain language” review

of Chinese law, Pet. App. 97a, without asking whether

a Chinese lawyer would do the same. It relied on a

series of unsupported assumptions about whether and

17

how Chinese law could “compel[]” anticompetitive con-

duct, which the court of appeals correctly rejected as

illogical. Jd. at 30a—32a. This analysis led the court

to accuse the Chinese government of intentional de-

ception. Jd. at 120—21a (“The 2009 Statement does not

read like a frank and straightforward explanation of

Chinese law.... [T]he Ministry's assertion of compul-

sion is a post-hoc attempt to shield defendants’ conduct

from antitrust scrutiny”). There was nothing “respect-

ful” (Pet. Br. 4) about this approach, and nothing reli-

able about it either.

Petitioners say (at 34—35) it is “incoherent” to afford

greater deference when a foreign sovereign actually

appears before a U.S. court. The courts of appeals dis-

agree. Compare Amoco Cadiz, 954 F.2d at 1312 (defer-

ence is owed even if “the interpretation may occur in

(or in anticipation of) litigation”), with Access Telecom,

197 F.3d at 714 (no deference where, inter alia, Mexi-

can agency was “not before the court”). So does the

Solicitor General, who acknowledges that a foreign

government’s direct participation ensures that the

court receives an interpretation grounded in the spe-

cific context of the dispute. SG Br. 25. And participa-

tion permits the court to engage directly with counsel

for the foreign sovereign, including by posing ques-

tions at oral argument.‘

Petitioners and their amici raise the specter of a for-

eign sovereign misleading a U.S. court to protect for-

eign interests (Pet. Br. 36; SG Br. 25), but they cannot

4 The Solicitor General says (at 24) the Second Circuit's de-

scription of the Ministry's submission as “a sworn evidentiary

proffer” was “inapt,” but the Ministry submitted a sworn declara-

tion authenticating the underlying materials. Regardless,

whether a foreign submission is “sworn” is not decisive; what

matters is whether it presents an official, authoritative interpre-

tation.

18

identify any instance of this happening even though

decisions like Pink and Amoco Cadiz have long been

on the books. Little wonder. Foreign governments are

not frequently parties in U.S. courts, and when they

are, U.S. law usually predominates, cf. RJR Nabisco v.

European Cmty., 1368. Ct. 2090 (2016), even if foreign

law plays some role, e.g., Amoco Cadiz, 954 F.2d at

1289.

Moreover, foreign governments have strong incen-

tives to accurately explain their laws to U.S. courts.

Because U.S. court filings are public, foreign govern-

ments know their statements will endure beyond the

case at hand, and may have ramifications in their

home courts or international tribunals. This very case

provides an exemplar: The United States (along with

the European Union and Mexico) cited the Ministry’s

filings as supporting a WTO complaint against China.

Infra p. 30. And if a foreign government were ever to

offer a facially incredible, inconsistent, or wholly un-

supported interpretation, neither Pink nor the deci-

sion below would require deference. Pet. App. 25a &

n.8; supra p. 8.

2. Deference also serves important international

comity principles. As just explained, deference rests

on the premise that foreign sovereigns will accurately

describe their law to U.S. courts. The Court should not

adopt a rule that encourages lower courts to decide

“whether the representation of consuls, ambassadors,

and other representatives of foreign nations is credible

or made in good faith.” Zschernig v. Miller, 389 U.S.

429, 434 (1968) (cautioning against such inquiries).

Foreign sovereigns will have little interest in partici-

pating in U.S. litigation if their motives inevitably will

be demeaned. The result of adopting Petitioners’

standard would be to deprive the courts of valuable

19

guidance in many cases, and to create needless inter-

national friction in others.

The Solicitor General disputes that these conse-

quences will follow, since “reject{ing] a foreign govern-

ment’s characterization of its laws does not thereby ac-

cuse the foreign government of misrepresenting the

pertinent facts.” SG Br. 24 (emphasis added). But

such a rejection necessarily implies that the foreign

government is either misrepresenting the pertinent

law or is so ignorant of its law that an American judge

knows better. Neither suggestion promotes comity. Cf.

Br. for Australia, Canada, and United Kingdom as

Amicus Curiae at 9-10, Matsushita, 475 U.S. 574 (urg-

ing that ignoring Pink and allowing a U.S. court to ad-

judicate the veracity of a foreign sovereign’s legal

statement “would be an unacceptable intrusion into

[its] sovereignty’).

3. Some amici contend that strong deference would

“distort” the “holistic balancing” test this Court has ap-

plied to determine the effect of foreign law in a variety

of contexts. E.g., U.S. Chamber of Commerce Br. 3, 11;

see also Am. Antitrust Inst. Br. 4. These arguments

confuse two separate issues: (a) how to determine the

content of foreign law; and (b) once that content is de-

termined, what effect foreign law should have in U.S.

courts. See Pink, 315 U.S. at 220-21 (explaining that

these are “distinct matter|s]”). The latter question,

emphasized by these amici, is beyond the scope of the

question presented. Likewise, the “weighty separa-

tion-of-powers concerns” in Pink (Pet. Br. 41) influ-

enced the analysis of whether U.S. courts should give

20

effect to the Russian decree, not the antecedent deter-

mination of its Russian-law meaning. 315 U.S. at 221-

34.5

Here, after properly deferring to the Ministry’s sub-

missions, the Second Circuit turned to Sherman Act

precedents to decide whether dismissal was required

as a matter of comity. Pet. App. 12a—18a, 33a—38a.

The court’s answer was yes, and this Court declined to

review whether comity is an appropriate basis to dis-

miss a Sherman Act claim. Pet.i. Thus, U.S. law ul-

timately controlled this case by determining the effect

of Chinese law on the outcome.

C. Neither Rule 44.1 Nor Domestic Defer-

ence Doctrines Are Relevant Here.

1. Petitioners and the Solicitor General spill much

ink arguing that the decision below—and Pink, for

that matter—is inconsistent with Federal Rule of Civil

Procedure 44.1. Not so. Rule 44.1 provides that “[i]n

determining foreign law, the court may consider any

relevant material or source,” and the resulting deci-

sion is “a ruling on a question of law.” Fed. R. Civ. P.

44.1. As the Solicitor General concedes (at 17), the

Rule says nothing about deference to foreign sover-

eigns or the scope of a court’s discretion in reaching a

substantive determination of foreign law. Contra Pet.

Br. 31, 33. And there is no suggestion that the Rules

5 Thus, First National City Bank v. Banco Para el Comercio Ex-

terior de Cuba, 462 U.S. 611 (1983), does not counsel against def-

erence. Contra U.S. Chamber Br. 12-13. There, the Court ac-

cepted that a Cuban bank was “a separate and distinct juridical

entity” from the Cuban government under Cuban law, but applied

international and U.S. law to determine “the effect to be given to

Bancec’s separate juridica! status” for FSLA purposes. 462 U.S.

at 616 n.3, 619, 621. As in Pink, the Court accepted that Cuban

law had the meaning asserted by Cuban officials, and looked to

U.S. law to determine the effect of that foreign-law conclusion.

21

Committee intended to alter or abrogate Pink in any

way. The Second Circuit rightly found no conflict be-

tween Rule 44.1’s procedures for determining foreign

law and Pink’s rule of deference. Pet. App. 22a; cf.

Pink, 315 U.S. at 220-21 & nn.4—5 (applying New

York’s procedural rules on how a court may receive ev-

idence of foreign law).

Nor is there any conflict between Pink’s deference

rule and Rule 44.1’s purposes of (i) establishing that

foreign law’s meaning is a question of law, not fact, and

(ii) removing limitations on the materials a court may

consider. See Pet. Br. 28, 30—31; SG Br. 14-16. The

“interpretation” of a federal statute is equally “a ques-

tion of law,” McDermott Intl, Inc. v. Wilander, 498

U.S. 337, 356 (1991), and yet courts routinely defer to

agency interpretations of those statutes, Encino Mo-

torcars, LLC vy. Navarro, 136 §S. Ct. 2117, 2124—25

(2016). And the Second Circuit made clear that Pink’s

deference rule does not prevent a court from consider-

ing “any relevant material or source.” Pet. App. 12a,

22a (emphasis added); see Pink, 315 U.S. at 221 & n.5.

2. The parties generally agree that domestic defer-

ence doctrines do not govern here.* SG Br. 19—20; Pet.

Br. 47-55; Resp. Br. 31-32. But Petitioners draw the

wrong lesson from that fact, arguing there is no basis

to “privileg[e] the representations of foreign govern-

ments” over those of domestic government bodies. Pet.

Br. 47-48. That overlooks critical differences. U.S.

courts lack the expertise to decipher foreign law, and

thus risk reaching an erroneous interpretation that—

because it does not actually alter foreign law in non-

U.S. applications—imposes inconsistent legal obliga-

tions on regulated parties. See Richmark, 959 F.2d at

6 Petitioners’ lengthy argument (at 48-55) that “the Chevron

doctrine cannot be sensibly applied” here is thus beside the point.

22

1474 n.7 (court has no “power [ Jor ... expertise to de-

termine for ourselves what PRC law is”). Nor can such

an error be rectified through remand to a domestic

agency or congressional intervention.

Another telling difference is that a court’s refusal to

defer to a federal or state agency will not cause an in-

ternational incident. Rejecting a foreign sovereign’s

interpretation of foreign law can have just that result.

The Chinese Government has already protested the

district court’s disrespectful treatment of the Ministry

in this case. JA782—84. Deference here is thus sup-

ported by comity concerns that simply do not exist in

the domestic arena. See Amoco Cadiz, 954 F.2d at

1312 (“Giving the conclusions of a sovereign nation

less respect than those of an administrative agency is

unacceptable.”).

D. The Solicitor General’s Position Is Hope-

lessly Indeterminate.

Since abandoning its recognition that Pink provides

the standard of deference here, supra p. 8, the United

States has searched in vain for a clear and consistent

position. Although the Solicitor General now says (at

19) that domestic-deference “analogies are generally

unhelpful,” the Government argued in McNab that

Skidmore deference was the proper “analog[ue].” Brief

in Opposition at 17-18, McNab v. United States, No.

03-622 (Dec. 29, 2003) (McNab Opp.); but see SG Br.

21n.3. At the certiorari stage in this case, the Govern-

ment accepted that the Second Circuit’s formulation

was “not necessarily ... problematic.” Br. for United

States as Amicus Curiae at 9. Now the Solicitor Gen-

eral attacks the Second Circuit’s “rigid” standard (at

22), but declines to offer any “formula or rule” for def-

erence. He instead posits numerous (non-exhaustive)

“circumstances” that are “relevant,” suggests “the ap-

23

propriate weight in each case will depend on the cir-

cumstances,” and opines that a court should resolve “a

disputed question of foreign law ... in the same man-

ner as a court facing any other unsettled legal ques-

tion.” SG Br. 9, 16, 19-20, 21; see also Pet. Br. 54—55.

The Court should reject this invitation to overturn

every extant standard and leave the lower courts with

none. “[O}pen-ended balancing tests[ | can yield unpre-

dictable and at times arbitrary results,” Lexmark Int'l,

Inc. v. Static Control Components, Inc., 134 8S. Ct.

1377, 1392 (2014), and that caution is clearly apt here.

Never before have U.S. courts reviewed de novo a for-

eign sovereign’s interpretation of its own laws. Never

before has that been thought desirable. That standard

would not mirror past practice, and it would not mirror

international practice, under which, for example, “any

[WTO] Member can reasonably expect that considera-

ble deference be given to its views on the meaning of

its own law.”’ And it is a recipe for chaos and unfair

surprise—one-off judicial decisions that do not reflect

the actual law of any foreign jurisdiction, impose in-

consistent legal obligations on private parties, and

give rise to unwarranted diplomatic friction.

There is no need for such experimentation. Pink

held long ago that a foreign sovereign’s reasonable ex-

planation of its own law is conclusive of the foreign-

law question. That rule is workable, supported by

strong policy considerations, consistent with long-

? Panel Report, United States — Sections 301-310 of the Trade

Act of 1974, WTO Doc. WT/DS152/R © 7.19 (adopted Jan. 27,

2000), https://www.wto.org/english/tratop_e/dispu_e/wtds152r.

pdf. The United States advocates this “considerable deference”

standard in its own WTO submissions. E.g., Second Written Sub-

mission of the United States, United States — Section 12%c)1) of

the Uruguay Round Agreements Act, WT/DS221, at 3 (Mar. 8,

2002), https://goo.g/bnBYdN.

24

standing practice, and unaffected by Rule 44.1. The

Second Circuit’s holding was correct.

Il. THE COURT OF APPEALS CORRECTLY

DEFERRED TO THE MINISTRY’S REASON-

ABLE INTERPRETATION OF CHINESE

LAW.

A. The Second Circuit Properly Determined

That The Ministry’s Explanation Of Chi-

nese Law Was Reasonable.

1. Petitioners paint the Second Circuit's standard as

requiring blind deference to foreign sovereign inter-

pretations in all cases and without regard to other ev-

idence. Pet. Br. 22—23, 26; see SG Br. 22. Not so. The

Second Circuit recognized that it could “consi ‘er any

relevant material or source, including the legai author-

ities supplied by the parties on appeal.” Pet. App. 12a.

Even after receiving a foreign sovereign’s submission,

a court “must still evaluate the relevant source mate-

rial within the context of each case.” Jd. at 23a. If

“there is no documentary evidence or reference of law

proffered to support a foreign sovereign’s interpreta-

tion of its own laws, deference may be inappropriate.”

Id. at 25a n.8; see SG Br. 22 n.4. At bottom, deference

is proper only if the foreign sovereign’s explanation is

“reasonable under the circumstances.” Pet. App. 25a.

That is a sound and fair restatement of Pink’s holding.

2. In applying this standard, the Second Circuit

paid “careful attention” to the Chinese regulations at

issue and the facts surrounding their application. Pet.

App. 27a—33a. In particular, it observed that, “[t)he

2002 Notice, inter alia, demonstrates that from 2002

to 2005 ... Chinese law required Defendants to partic-

ipate in the PVC regime in order to export vitamin

C. This regulatory regime allowed vitamin C manu-

25

facturers the export only of vitamin C subject to con-

tracts that complied with the ‘industry-wide negoti-

ated’ price.” Id. at 27a. The court said that, by itself,

the term “industry-wide negotiated” might be ambigu-

ous, but pointed out that it would be “nonsensical” to

require regulated parties to comply with such a “mini-

mum price point if there were no directive to agree

upon such a price”; the court thus found reasonable the

Ministry’s explanation that “members of the regulated

industry were required to negotiate and agree upon a

price.” Jd. at 27a—28a.

The court similarly observed that “on their face the

terms ‘industry self-discipline,’ ‘coordination,’ and ‘vol-

untary restraint” could imply a lack of compulsion, but

accepted as reasonable the statement that setting

prices was mandatory, in light of the underlying mate-

rials and the Ministry’s explanation of the trade regu-

lations it had adopted. See Pet. App. 28a (Second Cir-

cuit stating that “these are terms of art within Chinese

law connoting the government’s expectation that pri-

vate actors actively self-regulate to achieve the govern-

ment’s policy goals”); JA138, 248-49. It was in this

context that the Second Circuit said a “court [must] not

embark on a challenge to a foreign government's offi-

cial representation to the court regarding its laws or

regulations, even if that representation is inconsistent

with how those laws might be interpreted under the

principles of our legal system.” Pet. App. 26a (empha-

sis added); SG Br. 22 (omitting the italicized lan-

guage); Pet. Br. 50 (same). The point was not that a

court must close its eyes to extrinsic materials; it was

that a U.S. court must remain keenly aware of its own

limitations as a foreign-law interpreter.

The Second Circuit then highlighted three key errors

committed by the district court. “First, [the district

26

court] determined that whether Chinese law com-

pelled Defendants’ anticompetitive conduct depended

in part on whether Defendants petitioned the Chinese

Government to approve and sanction such conduct.”

Pet. App. 30a. This was error because the reason for

the Chinese legal requirements is both irrelevant to

their existence and cannot be questioned under the

act-of-state doctrine. Jd. at 3la. “Second, it relied on

evidence that China’s price-fixing laws were not en-

forced to conclude that China’s price fixing laws did

not exist.” Jd. at 30a. This too was error, because it

“confuses the question of what Chinese law required

with whether the vitamin C regulations were en-

forced.” Id. at 32a.* “And third, it determined that if

Chinese law did not compel the exact anticompetitive

conduct alleged in the complaint, then there was no

true conflict.” Jd. at 30a. In fact, a true conflict exists

whenever it is impossible to comply with both nations’

laws, which is the case here. Jd. at 32a—33a.

3. Petitioners do not attempt to defend these errors.

They ignore them, and instead quote—five times—the

Second Circuit’s observation that, had the Ministry

not appeared in the litigation, the district court’s ap-

proach “would have been entirely appropriate.” Pet.

App. 30a n.10. Petitioners attempt to spin this into a

“concession” that the Second Circuit’s decision was

“(blased solely on the standard of ‘binding deference’

* The Second Circuit was clearly correct. We do not decide

whether theft is prohibited by counting shoplifting incidents.

Stealing is illegal, yet it occurs frequently. Contra Pet. Br. 10—

11. Indeed, Petitioners quote the head of the Vitamin C Subcom-

mittee urging “government departments to assist chambers of

commerce in asserting their authority, so that [the chambers] can

punish [noncompliant] companies.” /d. at 12 (first alteration in

original). This shows not that compulsion was absent, but that

enforcement was challenging.

27

that it imposed.” Pet. Br. 58-59. Not so. The Second

Circuit determined correctly that the district court

adopted a “nonsensical” interpretation of Chinese law.

It simply noted hypothetically that if the Ministry had

not appeared, the district court's approach of “at-

tempting] to parse ... China’s complex vitamin C mar-

ket regulatory framework” would have been “appropri-

ate.” Pet. App. 29a—30a & n.10. The district court's

erroneous conclusions received no blessing.

4. The district court also offered misguided reasons

for rejecting the Ministry’s interpretation.

First, the district court criticized the Ministry's 2009

statement as “undeserving of deference” because the

court believed it lacked citations. Pet. App. 119a—20a.

But the 2009 statement expressly invoked and reiter-

ated the arguments in the Ministry’s two prior submis-

sions, JA247—48, which provided much of the specific

citation to Chinese law that the district court appeared

to seek, Pet. App. 189a—223a; JA131—33.

Second, the district court said the 2009 statement

contained “ambiguous terms and phrases,” Pet. App.

120a, particularly as to the meaning and consequences

of non-compliance with “self-discipline,” id. at 132a—

33a. Both the Ministry and Respondents’ expert ex-

plained these points, and the district court’s desire to

see them spelled out in “a published series of specific

conduct-dictating prohibitions or compulsions with an

identified sanctions system,” Pet. App. 116a, was un-

realistic. In China, as in the United States, not all im-

portant legal concepts are set forth in positive enact-

ments; for example, what statute would an American

lawyer cite to prove the existence of non-retroactivity

or qualified immunity?

Third, the district court said the Ministry's 2009

statement failed to “distinguish between” the 1997 and

28

2002 regulatory regimes, Pet. App. 120a, a criticism

Petitioners reprise here (at 14—15). But the Ministry’s

amicus brief—which contained separate sections de-

scribing the 1997 “Initial Regulations” and the 2002

“Revised Regulation|s]”"—made clear that the 2002

amendments “changed the way in which compliance

with the [Chamber of Commerce of Medicines &

Health Products Importers & Exporters’] ‘coordina-

tion’ was confirmed.” Pet. App. 203a, 208a. Under the

new price-verification-and-chop system, or PVC, the

Chamber verified each manufacturer’s “contract price

and volume”: “If the price was at or above the mini-

mum acceptable price set by coordination through the

Chamber, the Chamber affixed a special seal, known

as a ‘chop,’ on the contract and returned it to the man-

ufacturer.” Jd. at 208a—O09a. Export was allowed “only

if the contract bore the Chamber’s ‘chop”; noncompli-

ance thus meant “denial by Customs of the ability to

export.” Id. at 209a.9

As before, the 2002 regime was adopted to “promote

industry self-discipline,” now based on “industry-wide

negotiated prices for those export products subject to

price review.” JA99—100; see Pet. App. 208a. It was

thus based on the same basic concept as before, but

implemented differently. Petitioners make much of

the fact that the 1997 Charter’s requirement to

“(s|trictly execute” the coordinated price was “abol-

ished” (Pet. Br. 15 (alteration in original) (emphasis

omitted)), but neglect to mention the “resolution”

adopted at a Chamber-ied meeting in late 2001 that,

under the PVC regime, “/t/he committed export volume

as part of the industry self-discipline shall be strictly

* Amici Howson and Clarke suggest (at 21) that Customs might

have refused to enforce a regime established by Ministry regula-

tions alone, but ignore that the 2002 Notice issued jointly from

both departments, JA99.

29

implemented.” JA459. Non-compliant exporters “will

be punished.” /d.

Further, Petitioners’ explanation of the 2002 regime

makes no sense. Petitioners urge the same “nonsensi-

cal” view the Second Circuit rejected: That even

though the PVC regime permitted export only “if the

contract met or exceeded an industry-determined min-

imum export price,” it allowed manufacturers to “opt-

out” and “did not prohibit exports in the event that [the

industry] declined to reach a price agreement in the

first place.” Pet. Br. 8-9. Such a regulatory program

would be pointless. Pet. App. 27a—28a. And the sup-

posed “opt-out” provision does not say what Petitioners

claim: It permits the suspension of price review by

“the customs and chambers,” not by individual manu-

facturers. JA100. There is no allegation that the reg-

ulators ever exercised this authority. Nor could man-

ufacturers “opt-out” by resigning from the subcommit-

tee (Pet. Br. 8-9); non-members were also bound to fol-

low the industry-wide negotiated prices because fail-

ure to do so would result in the denial of a chop.

JA105—06.

Petitioners’ reliance on the supposed plain language

of the 2002 documents is, like the district court’s, mis-

placed: Petitioners simply assume that Chinese terms

which translate as, e.g., “voluntary,” mean what they

would mean toa U.S. lawyer. E.g., Pet. Br. 7,9. These

misguided assumptions are not a sound basis to reject

the Chinese government’s official explanation (sup-

ported by expert testimony) of what these terms actu-

ally mean. E.g., JA139 (Chinese legal expert explain-

ing: “In no way was participation in the process ...

‘voluntary’ in the sense that it could be ignored.”).

Fourth, the district court said, and Petitioners ar-

gue, that the Ministry’s position here is inconsistent

with China’s statements to the WTO that it “gave up

30

‘export administration ... of vitamin C’ as of January

1, 2002.” Pet. App. 120a—21a (omission in original);

Pet. Br. 9, 19, 21, 53. This view reflects the same mis-

understanding as above: The “export administration”

China gave up was not the policy of industrial self-dis-

cipline that required price and output coordination,

but rather—as the WTO later found—the system of

“export quotas and licences” for Vitamin C that China

had followed until 2002. WTO, Trade Policy Review:

People’s Republic of China, WT/TPR/S/161, § 141 (Feb.

28, 2006), https://goo.gl/iPtMaZ.'° The 2002 Notice

thus explained that, “in order to accommodate the new

situations since China’s entry into WTO” while still

“promot[ing] industry self-discipline,” certain products

were “no longer subject to supervision and review by

the customs” but were instead “subject to [PVC] by the

chambers.” JA99 (emphasis added); JA428~—29 (de-

scribing the replacement of the 1997 “export licensing”

regime with the PVC regime).

The United States agreed. In a 2009 WTO proceed-

ing related to raw materials, it relied on the Ministry’s

amicus brief in this case to argue that “China coordi-

nates export prices for the products at issue through a

‘system of self-discipline’ based on informal statements

and oral agreements between traders and export reg-

ulators and where the [relevant chamber of commerce]

directs commodity-specific branches or coordination

'0 Amici Clarke and Howson, who claim no trade-law expertise

(at 1-2), flatly ignore WTO’s summation in declaring it “inescap-

able” (at 17) that China made inconsistent statements. They

seem not to have considered the possibility that their lay under-

standing of trade-law terminology is incorrect.

31

groups.” JA676 (emphasis added).'' The WTO ac-

cepted that position, holding that “China requires ex-

porting enterprises te export at set or coordinated ex-

port prices or otherwise face penalties.” JA722.'2

Thus, the United States and the WTO both said what

MOFCOM has maintained here: after 2002, China was

still requiring exporters to follow a price-setting re-

gime, albeit one that took a different form than before.

There is thus no inconsistency that could undermine

the Ministry’s position. But the district court’s error

was more fundamental. Even if China’s statement re-

garding giving up “export administration” could be

read as connoting an abandonment of every form of

price or output control for Vitamin C, including indus-

trial self-discipline, that would at most establish that

the reading pressed by Petitioners and embraced by

the district court is possible. Petitioners have never

identified any evidence that anyone contemporane-

ously read the “export administration” statement as

they do, and all evidence is that WTO participants did

not. In such circumstances, a court should endeavor

to reconcile the foreign sovereign’s statements, rather

‘1 See also First Written Submission of the United States of

America, China—Measures Related To The Exportation Of Vari-

ous Raw Materials, WT/DS394/DS395/DS8398 4 208 & nn.284—90

(June 1, 2010), https://goo.gl/95Qiwv (relying heavily on the Min-

istry’s brief); Opening Oral Statement of Complainants, China—

Measures Related to the Exportation of Various Raw Materials,

WT/DS394/DS395/DS8398 {31 (Aug. 31, 2010), https://goo.gl/

Gaqkcp6 (arguing that China maintained “a system that prevents

exportation unless the seller meets or exceeds the minimum ex-

port price”).

'2 This holding belies the notion that the raw-materials pro-

ceeding is distinguishable because it focused on whether conduct

was “attributable to,” rather than “required” by, China. SG Br.

31 n.7.

32

than jump to the conclusion that the supposed incon-

sistency is a product of deceitful intent. Only if such

reconciliation is impossible should the court consider

declining to defer. That slow-to-anger approach is sup-

ported by the accuracy and comity considerations dis-

cussed above, and fully addresses the Sclicitor Gen-

eral’s (rather alarmist) concern that foreign govern-

ments will lightly swap positions and demand defer-

ence at each turn. See McNab Opp. at 18-19. Because

there was no inconsistency here—much less an irrec-

oncilable one—the Second Circuit properly deferred to

the Ministry’s reasonable interpretation of the regula-

tions it created.

B. The Ministry’s Authority To Interpret Its

Own Rules Is Beyond Dispute.

Petitioners assert for the first time in this Court that

the Ministry may lack authority to interpret its own

rules and directives. This untimely argument is frivo-

lous.

The regulations and requirements at issue indisput-

ably fall within the Ministry’s jurisdiction as “the high-

est authority within the Chinese Government author-

ized to regulate foreign trade.” Pet. App. 6a; Foreign

Trade Law, art. 3 (promulgated by Standing Comm.

Nat'l People’s Cong., May 12, 1994, revised Apr. 6,

2004), https://goo.g/sHn37U (“The [Ministry] is in

charge of foreign trade throughout the country pursu-

ant to this Law.”). The Ministry “formulates strate-

gies, guidelines and policies concerning domestic and

foreign trade and international economic cooperation,

drafts and enforces laws and regulations governing do-

mestic and foreign trade, and regulates market opera-

tion,” and until 2008 the Chamber operated “under the

Ministry’s direct and active supervision” as part of “a

regulatory pricing regime mandated by the govern-

33

ment of China.” Pet. App. 190a—9la, 196a—97a. Re-

spondents’ expert testified below, without contradic-

tion, that the Ministry’s “interpretation of its own reg-

ulations and policies carries decisive weight under

Chinese law.” JA142. He was correct. In 2001,

China’s State Council promulgated rulemaking proce-

dures that empower the Ministry to make and inter-

pret its own regulations. See Add. 24—25, Decree of the

State Council, People’s Republic of China (No. 322),

Regulations on Procedures for Formulation of Rules,

art. 33 (effective Jan. 1, 2002) (“The power to interpret

rules belongs to the formulating organs of rules.... In-

terpretations of rules have the same force and effect as

the rules themselves.”). 14

Further, the Chinese diplomatic note submitted to

the Second Circuit, JA782—84, underscored the point:

The Ministry’s brief stated “the official views of the

People’s Republic of China,” JA131. China spoke here

with one voice, and the Second Circuit correctly de-

ferred to the Ministry’s reasonable interpretation of

Chinese law.

‘3 The English translation in the Addendum was performed by

Peking University Law School and retrieved from a Chinese com-

mercial legal database, http://www.lawinfochina.com/, on March

20, 2018.

34

CONCLUSION

For these reasons and those stated in Respondents

brief, the Court should affirm the judgment below.

Respectfully submitted,

JOEL M. MITNICK CARTER G. PHILLIPS*

SIDLEY AUSTIN LLP KWAKU A. AKOWUAH

787 Seventh Avenue TOBIAS S. LOSS-EATON

New York, NY 10019 MACKENZI SIEBERT

(212) 839-5300 SIDLEY AUSTIN LLP

1501 K Street, N.W.

Washington, D.C. 20005

(202) 736-8000

cphillips@sidley.com

Counsel for Amicus Curiae Ministry of Commerce

of the People’s Republic of China

April 4, 2018 * Counsel of Record

ADDENDUM

Add1

DECREE OF THE STATE COUNCIL

OF THE PRC (NO. 322)

Decree of the State Coun-

cil of the People’s Republic

of China

(No. 322)

The Regulations on Proce-

dures for the Formulation

of Rules were hereby

promul-gated and effective

as of January 1, 2002.

Premier, Zhu Rongji

November 16, 2001

Regulations on Procedures

for the Formulation of

Rules

Chapter I General Provi-

sions

Article 1 These Regula-

tions are formulated in ac-

cordance with the relevant

provisions of the Legisla-

tion Law to standardize

the procedures for the for-

mulation of rules and to

ensure the quality of rules.

PPARRAERSES

(#3228)

Rat (AQRWEEFR

A) ,B2002%1A1

Feeiesy.

SE See

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B-K ATACAR

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ERR.

Add2

Article 2 These Regula- S-—G WEN.

tions apply to the project #M@, #@, RE. 2%.

establishment, drafting, 8 , BBARPI,

examination, decision on, BEAR OINSE HIP HOM RE

promulgation and inter- FH

pretation of rules. _—

The rules formulated in vi-

olation of these Regula-

tions are null and void.

Article 3 The formulation B= WEA, W

of rules shall comply with 4iM@SZjAIKWOEAZIAR

the legislative principles WW, M@RMiK. ike, HR

established by the Legisla- jAM@AINthLMAMOME.

tion Law and conform to

the provisions of the Con-

stitution, laws, adminis-

trative regulations and

other superior laws.

Article 4 The formulation

of rules shall effectively

safeguard the lawful

rights and interests of citi-

zens, legal persons and

other organizations, and

while prescribing the obli-

gations they shall per-

form, provide the corre-

sponding rights they have

and the means by which

the realization of such

rights are guaranteed.

Add3

The formulation of rules

shall embody the principle

of uniting the powers and

responsibilities of admin-

istrative departments, and

while vesting necessary

powers in the relevant ad-

ministrative departments,

provide the conditions and

procedures for executing

such powers, as well as re-

sponsibilities they shall

undertake.

Article 5 The formulation

of rules shall embody the

spirit of reform, scientifi-

cally regulate administra-

tive acts, and promote the

shift of government func-

tions towards economic

adjustment, social man-

agement and public ser-

vices.

The formulation of rules

shall conform to the prin-

ciple of simplification, uni-

fication and efficiency, as-

sign identical or similar

functions to one adminis-

trative department, and

simplify administrative

formalities.

Add4

Article 6 Rules are nor- BAK ARMS

mally titled “provisions” or MK'Mir’. “INK”, AF

“mea-sures”, but they may Ki”.

not be titled “regulations”.

Article 7 The wording of Sth AMAANS

rules shall be accurateand %#%. MA. RNABMW4

concise with the contents 8®. Aw#, RABY

of their articles clear, con-

tt.

crete and operable. ite, AAMC NRIMENY

In principle, the matters AG, MERU LAFES

that have been clearly M2.

stipulated in laws or ad- Sees aeRO

ministrative regulations xem. aE-8

shall not be repeatedly

provided in rules.

Rules shall not, in princi-

ple be arranged into chap-

ters or sections other than

the rules that are complex

in content.

Article 8 With regard to

matters which involve the

powers of two or more de-

partments of the State

Council, and for which the

conditions for formulating

administrative regula-

tions are not yet ripe and

the formulation of rules

are called for, the relevant

departments of the State

Add5

Council shall jointly for-

mulate rules.

Under the circumstances

provided in the preceding

paragraph, the rules for-

mulated by a relevant de-

partment of the State

Council on its own are null

and void.

Chapter II Project Estab- 4—— WH

lishment

Article 9 The internal in-

stitutions or other institu-

tions of departments of the

State Council shall apply

to such departments for

project establishment

when they deem that there

is a need to formulate de-

partmental rules.

The subordinate working

departments of the peo-

ple’s governments of the

provinces, autonomous re-

gions, municipalities di-

rectly under the Central

Government and compara-

tively larger cities or the

people’s governments at

lower levels shall apply to

the people’s governments

Add6

of the provinces, autono-

mous regions, municipali-

ties directly under the

Central Government or

the comparatively larger

cities for project establish-

ment when they deem that

there is a need to formu-

late local government

rules.

Article 10 The necessity

for formulating rules, the MWMiei® , M4ISTEM

major issues to be solved

and main systems to be es-

tablished, etc. shall be Fie.

stated in the applications

submitted for project es-

tablishment of the formu-

lation of rules.

Article 11 The legislative

affairs institutions of the

departments of the State

Council and the legislative

affairs departments of the

people’s governments of

the provinces, autonomous

regions, municipalities di-

rectly under the Central

Government and the com-

paratively larger cities

(hereinafter referred to as

Add7

legislative affairs depart-

ments) shall study the ap-

plications for project es-

tablishment of the formu-

lation of rules on a consol-

idated basis, draft their

own departmental or gov-

ernmental annual work-

ing plans for formulating

rules, and submit such

plans to their own depart-

ments or the people’s gov-

ernments at the same lev-

els for approval before im-

plementation.

The tities of the rules to be

formulated, the drafting

units, the time for the com-

pletion of drafting, etc.

shall be clearly provided in

the annual working plans

for formulating rules.

Article 12 The depart-

ments of the State Council

and the people’s govern-

ments of the provinces, au-

tonomous regions, munici-

palities directly under the

Central Government and

the comparatively larger

cities shall strengthen

leadership over the imple-

mentation of their annual

MM Bie 1 Fit RUAN

FARRIS FR. ACR

(2, FEARATIA)S

BK HHH

1, #. BiaS, Bet

RARIHATA RB , AVS

DOSS T SF AEH ET

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MME LT WANE

ABA T PERMA AY 4 HT

ROPE , ARRAS

MABRA RBUPRIE.

MMB TFT RITA

17> , BLASER F

Add8

working plans for formu-

lating rules. The units

charged with the drafting

of the rules in the said

plans shall lose no time in

doing so, and submit the

draft rules to their own de-

partments or the people's

governments at the same

levels for decision as re-

quired.

An annual working plan

for formulating rules may,

in light of actual condi-

tions, be adjusted in the

course of its implementa-

tion, and additional ap-

praisals shall be carried

out for the rules projects to

be added.

Chapter III Drafting

Article 13 The drafting of

departmental rules shall

be organized by the de-

partments of the State

Council; the drafting of lo-

cal government rules shall

be organized by the peo-

ple’s governments of the

provinces, autonomous re-

DAVES , SL DNAT BOD

FAY SET #h FEIOUE.

A=K we

BSR MMH

RIS RAB ARRAS , th75

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95 Geass) 2) LAE A eR

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Wie aac .

Add9

gions, municipalities di- 6. Biek. BwHARA

rectly under the Central M®rbMARBUFSILEM

Government and the com- BhA— MIRA

paratively larger cities. TRGRRRATYE , thay

A department of the State LARA TE Ea Fa i ie Ba,

Council may assign one or SeREM.

several of its internal in- ®#RMBARMAAKES

stitutions to draft rules,or ®. @RBM, hawete

assign its legislative af- @AxX@R. Amwe,

fairs department to con-

duct or organize such

drafting.

The people’s government

of a province, an autono-

mous region, a municipal-

ity directly under the Cen-

tral Government or a com-

paratively larger city may

assign one or several of its

departments to draft

rules, or assign its legisla-

tive affairs department to

conduct or organize such

drafting.

In drafting rules, relevant

experts or organizations

may be invited to partici-

pate therein, and relevant

experts or organizations

may also be entrusted

with drafting.

Add10

Article 14 In drafting

rules, in-depth investiga-

tions and researches shall

be conducted, practical ex-

perience shall be summed

up, and the comments of

relevant organs, organiza-

tions and citizens shall be

extensively solicited. The

solicitation of comments

may take the forms of

written correspondence,

forums, appraisal meet-

ings, hearings, etc.

Article 15 When the rules

being drafted directly in-

volve the immediate inter-

ests of citizens, legal per-

sons or other organiza-

tions, and relevant organs,

organizations or citizens

hold substantive disagree-

ment with the rules being

drafted, these rules shall

be made public for com-

ments; the drafting units

may also hold hearings

thereon. A hearing shall

be organized in accordance

with the following proce-

dures:

Stok KANE,

NSRAMBRE , BSL

BAR , PIZHMAKN

KX. GBRACRHBA.

RDA ARR BAERS

TD, BRS. ira. WFiE

RSSREX.

Stik HAMM

BRBRER. AMAR

HERDS ts , BK

KX. GBRRSCRWIRAS

ABRADED , Meets

4 , TRHSSARHE

DR ; BRS Mba Lasso

WES. UTES RAR POR

Rm :

Add11

(1) a hearing shall be open (— ) ERAT , fe

to the public; the draft- Mew -4tassornrens

ing unit shall make 3 0 BRIA OES At

public the time, venue’ f], ##AFDAS:

for, and contents of the

hearing 30 days before

the hearing is held;

(2) the relevant organs, or- (=) SMIPRESHaKH

ganizations and citi- *, @RAARHRAMH

zens that participate in 8, BABAR :

a hearing shall have the

right to put forward

questions and make

their comments with re-

spect to the rules being

drafted;

(3) written records shall be (=) ESM SHES

made for a hearing to &, MLicRREAMFE

faithfully record the WAAR:

speakers’ main view-

points and _ reasons

thereof: and

(4) the drafting unit shall (2) BRAWN SiR

seriously study the SUreEeRRHSHRL,

comments expressed at #MAQMMICERiXHEe .

a hearing, and give ex- M>4ieaAxt0riESRAe

planations on the han- ##2RA#H.

dling of these comments

and the reasons for

Add12

such handling when

submitting drafted

rules for examination.

Article 16 When drafting Bt7R LAB IN

departmental rules that B, BRAShew thas

involve the powers andre- Remake SHSheR thst)

sponsibilities of other de- *R#M , M&Ms

partments of the State AHRHSRA Hs IAN

Council or are closely re- 2.

lated to other departments SRS BUM 3

of the State Council, a

drafting unit shall ade- pn cael

quately solicit the com- ) , sRLBAAT AY 6 FES} ESR

ments of these depart- Hth88 HOUT. ey

— SHUtheB EARLS

When drafting local gov- M4ADMR : BRD

ernment rulesthatinvolve %7#BRlG—BS1M . te

the powers and responsi- Bey 4 RAMS

bilities of other depart- iki (LAF eRMBKH

ments of the people’s gov- #&) MtiRaRtas2AIHER.

ernment at the same level

or are closely related to

other departments at the

same level, a drafting unit

shall adequately solicit the

comments of these depart-

ments. A drafting unit

shall sufficiently consult

with the departments that

disagree with its com-

ments; where a consensus

is not reached after such

sufficient consultations,

the drafting unit shall give

Add13

explanations on the cir-

cumstances of and the rea-

sons for such non-consen-

sus when it submits the

draft rules for examina-

tion (hereinafter referred

to as the draft for exami-

nation).

Article 17 A drafting unit

shall, in accordance with

the provisions, submit a

draft for examination and

the explanations thereof,

the differing comments on

the major issues therein

and other relevant materi-

als for examination.

A draft for examination to

be submitted for examina-

tion shall be signed by the

principle responsible per-

son of the drafting unit; a

draft for examination

jointly drafted by several

units shall be signed by

the principle responsible

persons of the said units.

In the explanations of a

draft for examination, the

necessity for formulating

the rules, the main

measures provided there-

Th. UESER. VFR

i. BASMS AAS

=.

Add14

in, the opinions of relevant

circles, etc. shall be stated.

The relevant materials

mainly include the com-

ments collected from vari-

ous circles, written records

of hearings, reports of in-

vestigations and re-

searches and the relevant

legislative materials from

both at home and abroad,

etc.

Chapter IV Examination 40m HE

Article 18 Drafts for ex- Bt/\K HMKHR

amination shall be uni- axa ath Bo Be.

formly examined by iegis- : .

lative affairs departments. ea

Legislative affairs depart-

ments shall examine

drafts for examination

mainly in the following as-

pects:

(1) whether they are in (— ) BARAAROA=

conformity with the &, AUR, #BARMM

provisions in Articles £;

3, 4 and 5 of these Reg-

ulations;

Add15

(2) whether they are in (—) BESAXAEY

harmony or coordi- 8 ##:;

nated with the rele-

vant rules;

(3) whether the comments (=) BARERMBAXMU

of the relevant organs, K. BRAARWIMBKS

organizations and citi- ®+#aqm@nie:

zens on the main is-

sues addressed in the

draft for examination

have been correctly

handled;

(4) whether they conform (2) BAAAWARARE

to the technical re- &;

quirements of legisla-

tion; and

(5) other items that need (i) SSRSHiRhA

to be examined. a.

Article 19 Where a draft BtnAR WMKH

for examination fall under #@ FERS —AY , KR

one of the following cir- WAU/4HataiReieae

cumstances, the legisla- (v7:

tive affairs department

may table the examination

thereof or return it to the

original drafting depart-

ment:

Add16

(1) the basic conditions for

formulating the rules

are not yet ripe;

(2)the relevant institu-

tions or departments

disagree greatly with

one another on the

main systems provided

in the draft for exami-

nation, and the drafting

unit has not consulted

with these institutions

or departments; or

(3) the submission of the

draft for examination

does not conform to the

provisions in Article 17

of these Regulations.

Article 20 Legislative af-

fairs departments shall

send drafts for examina-

tion or the main issues

that the drafts for exami-

nation involve to the rele-

vant organs, organizations

and experts for comments.

( — ) PUTER MAMA eA

ASSIA ;

(=) LRSM A

Add17

Article 21 Legislative af-

fairs departments shall

conduct on-spot investiga-

tions and researches at the

grass root level into the

main issues that the drafts

for examination involve

and solicit the comments

of the relevant depart-

ments, organizations and

citizens at the grass root

level.

Article 22 Where a draft

for examination involves

major issues, the legis-la-

tive affairs department

shall hold forums or ap-

praisal meetings partic-

ipated by relevant depart-

ments or experts to solicit

comments, and to study

and appraise the draft for

examination.

Article 23 Where a draft

for examination involves

the immediate interests of

citizens, and the relevant

organs, organizations and

citizens disagree with one

another, and the drafting

unit have neither made it

B—+—K WRK

MPRBASBN . KB

NASBA RAKS. ©

RSMMAKA. Like .

RD, , HFC.

B—t=K WMH

MERBRER. KAMA

FARA At , AK

KX. GRUFCRUIRAE

ABR , MMM Fie

RIRPRAMAO , th

RATER , RNG

BAB) MAARA

Add18

public nor held appraisal

meetings in the course of

its drafting, the legislative

affairs department may,

upon the approval of its

own department or the

people’s government at the

same level, make the draft

for examination public or

hold hearings thereon.

Where a hearing is held, it

shall be organized in ac-

cordance with the proce-

dures provided in Article

15 of these Regulations.

Article 24 Where the rel-

evant institutions or de-

partments disagree with

one another on issues such

as the main measures, ad-

ministrative systems, the

division of powers that a

draft for examination in-

volve, the legislative af-

fairs department shall co-

ordinate among these in-

stitutions or departments

for reaching a consensus;

where a consensus is not

reached, the main issues,

the comments of these in-

stitutions or departments

and the proposals of the

HOE. LAG RoM , th

LAT OER.

BATOTUERAS , ALS HRA AS

FAB + BRMEAG SF A

R.

Add19

legislative affairs depart-

ment shall be submitted to

its own depariment or the

people’s government at the

same level for decision.

Article 25 A legislative af-

fairs department shall se-

riously study the com-

ments from various cir-

cles, and it shall, upon con-

sultation with the drafting

unit, revise the draft for

examination, and prepare

the draft rules and the ex-

planations thereof. The ex-

planations of the draft

rules shall include the

main issues to be solved,

the main measures to be

established by the formu-

lation of rules and the cir-

cumstances of consulta-

tions with the relevant de-

partments.

A draft rules and its expla-

nations shall be signed by

the principle responsible

person of the legislative af-

fairs department and

he/she shall put forward a

suggestion that the draft

rules and _ explanation

thereof be submitted to the

relevant meeting of its

Add20

own department or the

people’s government at the

same level for delibera-

tion.

Article 26 A draft rules B—+tAR RHI

the drafting of which is ®MMRAGRERANMAe

conducted or organized by 8, HixkMOUGtBMRA

a legislative affairs dee 32, RuMBAMOIRA

partment shall be signed ARARBUFAKAW HW

by the principle responsi- mid.

ble person of the said leg-

islative affairs department

and he/she shall put for-

ward a suggestion that the

draft rules and explana-

tion thereof be submitted

to the relevant meeting of

its own department or the

people’s government at the

same level for delibera-

tion.

Chapter V Decision and FHM RENAA

Promulgation

Article 27 Departmental B—+tte s/ 1MM

rules shall be decided at M4@MBS2iiaeease

ministerial meetings or #WRP.

general meetings of com- BURFSRLMLAY “462 BUF

missions. SRORESE ALONE.

Add21

Local government rules

shall be decided at the ex-

ecutive meetings or the

plenary meetings of local

governments.

Article 28 When a draft B—t/\R WME

rules is being deliberated, MAmt , HiXRHUGFR

explanations may be made 88, tha Lae LAA FI

by the legislative affairs 4%,

department or by the

drafting unit as well.

Article 29 The legislative B—+tAR KH

affairs institution shall,on M4HHBSXANHNETD

the basis of the delibera- xS3Q@EMIMRiATTEM , WAL

tion opinions of the rele- MARCUM, MBARBIA

vant meetings, revise the at@@k. BiIGKER.

draft rules, prepare the re- HK#M*O FU.

vised draft rules, and sub-

mit it respectively to the

depart-mental head, or the

provincial governor, the

chairperson of the autono-

mous region or the mayor

for signing the decree to

promulgate the rules.

Article 30 It shall be spec- B=tK 2AM

ified that the formulating @@m4RRRMeEMHE

department, the serial XK, #8. MMAR.

number, the title of rules, WHAM. BOB. 0G

Add22

the date of adoption, the

date of implementation,

the signature of the de-

partmental head, or the

provincial governor, the

chairperson of the autono-

mous region or the mayor,

and the date of promulga-

tion in a decree promulgat-

ing rules.

Rules formulated jointly

by several departments

shall be signed jointly by

the heads of the relevant

departments for promul-

gation, and the decree se-

rial number of the depart-

ment that led the formu-

lating shall be used.

Article 31 Departmental

rules shall, upon signature

for promulgation, be

promptly published in the

gazette of the department

or in the gazette of the

State Council and in the

nationally distributed

newspapers.

Local government rules

shall, upon signature for

promulgation, be promptly

published in the gazette of

the people’s government at

Kae. BIG.

PBRASUREAAM.

BB) RA RA Be AY

BIBKRABAA , iF

FEDNAMB SHS.

B=t—-R BIMM

SEAS . BARA

95 Bee RFS CRA 2

FTAA IRAE AY RAT FLA

Fuge.

SH BURRESS

BBA RB ARIA ITB

CX RFE RBS Bet TATRA AY

RAT FS.

FERRARA IS Be IR

POETS A BRIBUIT 298 FF

ROM MESL AS THES AR.

Add23

the same level and in the

newspapers distributed

within their respective ad-

ministrative areas.

The text of the rules that

are published in the de-

partmental gazette, the

gazette of the State Coun-

cil or the gazette of the lo-

cal people’s government is

the authentic text.

Article 32 Rules shall be B=+—R We

effective 30 days after the 82283 08S

date of promulgation; but 4; @8 , #RER#2.

those rules that involve 4NCIC#. RBC

national security or the de- WRF BRT eR

termination of foreign ex- @MBBITN , TUBA

change rates or monetary Z@eiet.

policies as well as those

the implementation of

which will be impeded if

they are not implemented

promptly may be effective

as of the dates of promul-

gation.

Add24

Chapter VI Interpretation

and Submission for the

Record

Article 33 The power to

interpret rules belongs to

the formulating organs of

rules.

The formulating organs

shall give interpretations

to the rules that fall under

one of the following cir-

cumstances:

(1) the specific meaning of

their provisions needs

to be further defined; or

(2) after their formulation,

new development ma-

kes it necessary to de-

fine the basis on which

they are applied.

Interpretations of rules

shall be proposed by the

legislative affairs de-

partments of the formu-

lating organs with ref-

erence to the proce-

dures for the examina-

tion of the draft rules

SR RRSBR

B=t=K AME

RAFARHENX.

RRA PMPNARZ—A , A

SEMA :

Add25

for examination, and

they shall be promul-

gated after submission

to and approval by the

formulating organs.

Interpretations of rules

have the same force and

effect as the rules them-

selves.

Article 34 Rules shall,

with-in 30 days as of the

date of promulgation, be

submitted by the legisla-

tive affairs departments in

accordance with the provi-

sions of the Legislation

Law and the Regulations

on Submission of Regula-

tions and Rules for the

Record to the relevant or-

gans for the record.

Article 35 State organs,

social organizations, en-

terprises and institutions,

and citizens may put for-

ward in writing sugges-

tions for reexamination to

the State Council where

they deem that certain

rules contradict with laws

B=+tOe ARN

B62 AB#30RA, &

AAO RRRIZIAAAD GA

RAMERRH) MME

AAMAS.

B=tik Ri

A. tee, Dave

A. GRUAMMAIZR.

tTRUZAEIA , ATLA)

RSS heh eA

1, RRS RAB MOT

is

BRNX. Hee. Bk

PUBR. GRUARAN

DHA RBM MEA.

Add26

or administrative regula-

tions, and such sugges-

tions shall be studied and

handled by the legislative

affairs department of the

State Council.

State organs, social organ-

izations, enterprises and

institutions and citizens

may also put forward in

writing suggestions for

reexamination to the peo-

ple’s governments of their

respective provinces or au-

tonomous regions where

they deem that certain

rules formulated by the

people’s governments of

comparatively larger cities

contradict with laws or ad-

ministrative regulations

or violate the provisions of

other superior laws, and

such suggestions shall be

studied and handled by

the legislative affairs de-

partments of the people’s

governments of the prov-

inces or autonomous re-

gions.

Add27

Chapter VII Supplemen-

tary Provisions

Article 36 Decisions or or-

ders with general binding

force to be made or issued

by the local people’s gov-

ernments at or above the

county level that do not

have the power to formu-

late rules according to law

shall be made or issued

with reference to the pro-

cedures provided in these

Regulations.

Article 37 The depart-

ments of the State Council

and the people’s govern-

ments of the provinces, au-

tonomous regions and mu-

nicipalities directly under

the Central Government

as well as the people’s gov-

ernments of the compara-

tively larger cities shall

frequently sort out their

rules, and promptly revise

or repeal those rules that

are found to be inconform-

ity with new enacted laws,

administrative regula-

tions or the provisions of

Atm WR

B=tcR Shas

], #. Bek, Bers

RAAIHATA RBU , AV

CmTRRHTE . LH

SHORE. TRUER

eit ici A—

BO , ME SIAM. TTBUX

REL A fbb EAS

a, MS RASA

Add28

other superior laws or are

found to be in contradic-

tion with laws, adminis-

trative regulations’ or

other superior laws.

The procedures for the re-

visions of and repeal of

rules shall be _ imple-

mented with reference to

the relevant provisions of

these Regulations.

Article 38 The editing BTN WARK

and publication of the col- iExthma, RRSZMR. 9boz

lections of rules in official AAOESCOH , IX sIt

editions, in the languages 4a G2EACRMER

ofethnic groupsandinfor- #88r) HAxXMen

eign languages shall be 4%,

handled by legislative af-

fairs departments in ac-

cordance with the relevant

provisions in the Provi-

sions on Administration of

Editing and Publication of

Collections of Regulations.

Article 39 These Regula- B=tnK ARG

tions shall be effective as 200241518

of January 1, 2002. 5.