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Judicial aid made available to firms

By Cao Li (China Daily)
Updated: 2008-12-03 07:30

SHANGHAI -- Local firms battling the effects of the global financial crisis, will pay lower fees to defend lawsuits brought against them, Shanghai's High People's Court said in a statement on Tuesday.

Providing they meet certain conditions, the companies will be subject to reduced court costs, or have their expenses delayed or exempted, the statement said.

This is the first time financial support in judicial hearings has been made available to firms. It was previously available only to individuals.

Shanghai courts have reported a growing number of cases involving small- and medium-sized firms amid the current financial turmoil.

In response, the high court has ordered all lower courts to proceed with caution in litigation cases, and to keep in mind the economic situation and the need to maintain social stability.

As well as speeding up the judicial process, a single court will be appointed for firms involved in several litigations across different judicial bodies, and mediation will be increasingly used to solve problems, the high court said.

In trying cases in which companies owe employees salary payments, courts must seek to protect the interests of both parties, it said.

Pan Fuyuan, director of the Shanghai No 1 Intermediate People's Court said: "Given the fact that many firms are already suffering because of the economic conditions, if we don't proceed properly, many of them could go bankrupt.

"If that happens, workers will not get paid," he said.

"If there is a need to freeze a company's assets, we will try to do so in a way that allows it to continue operating."