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ARTICLE · 25 AUGUST 2021

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Is An NDA A Useful Tool When Doing Business In China?

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LUXI CHEMICAL ("LUXI"), a Chinese listed company in the Chemical industry, recently received a Civil Ruling from Liaocheng Intermediate People's Court in Shandong Province in China...

ChinaCorporate/Commercial Law
Le Rong
Le Rong
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LUXI CHEMICAL ("LUXI"), a Chinese listed company in the Chemical industry, recently received a Civil Ruling from Liaocheng Intermediate People's Court in Shandong Province in China, which ruled to recognise the arbitration award made by the Arbitration Institute of the Stockholm Chamber of Commerce in Sweden on November 07 2017 in relation to the breach of the Non-Use and Confidentiality Agreement on Low Pressure Carbonyl Synthesis Technology signed among the Chinese company, Johnson Matthey Davy Technology Ltd. and Dow Global Technologies Ltd.

According to the arbitration award, LUXI should compensate the total of various costs of approximately CNY 749 million (over USD 100 million) and disable a planned plant of the Chinese company. This is the first recognition by a Chinese court of a foreign arbitral institution's award on a non-disclosure agreement ("NDA"), and sets a new record for the amount of the subject matter of a case to enforce a foreign arbitral award.

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