Who issues apostilles?

According to the Convention, apostilles (which in practice often take the form of a signed and dated sticker, attached to an official document) are provided by the “Competent Authority” designated to authenticate documents by the country of origin of the document. By way of example for the jurisdiction of Hong Kong SAR, which for these purposes is considered an own-standing legal regime and therefore a jurisdiction different from Mainland China, apostille services are provided by the High Court of Hong Kong SAR. Two main types of documents fall within the scope of apostille services provided by the High Court of Hong Kong SAR. The first type of documents is public documents bearing the true signature of an official party such as a Hong Kong SAR government recognized officer, e.g. the Business Registration Certificate and the Certificate of Incorporation of a Hong Kong SAR incorporated company. The other type of documents is documents notarized by a notary public qualified to practice in Hong Kong SAR, e.g. a notarized Power of Attorney or a notarized true copy.

In many other jurisdictions, the local Ministry of Foreign Affairs issues apostilles, e.g. in the US, records issued by a US state will need an apostille from that state's Secretary of State, while federal documents will need an apostille from the U.S. Department of State.

In China, the Ministry of Foreign Affairs will be the Competent Authority for issuing apostilles for public documents issued by a public authority within China.

What does this mean in practice?

Prior to China’s accession to the Convention, foreign official documents for use in China (e.g. (a) incorporation certificates required for incorporation and acquisition of enterprises by foreign investors as well as subsequent changes in relation to the foreign investors, and (b) formality documents for litigation such as the Power Of Attorney, Certificate of Legal Representative, Certificate of Incorporation/Good Standing etc.) had to be legalized. As a first step, the foreign party had to obtain the official document in the country of origin. As a second step, this document needed to be notarized and then legalized by the relevant government body in the country of origin of the document. As a third step, the legalized copy still needed to be legalized by the Chinese embassy or consulate in the country of incorporation. Overall, this process could take several months from start to finish, which was especially problematic for urgent filings or court proceedings where Chinese courts often impose very strict timelines for accepting foreign documents and evidence. For example, (a) failure to submit formality documents to the Beijing IP Court on time may result in the case being dismissed; (b) a prolonged company registration procedure where apostilled documents are required may change a foreign investor’s original selection of parent entity of a PRC subsidiary from a non- Hong Kong entity to a Hong Kong entity (as an apostille is required when the intended parent entity of a PRC subsidiary is a Hong Kong entity), which may not necessary be needed even from a tax perspective, or (c) such lengthy legalization process may postpone the closing of a merger & acquisition transaction or increase the deal uncertainty.

Now, China’s accession to the Hague Convention and the use of apostilles will simplify this process very considerably as between China and such other Member Countries. From today onwards, a foreign party of a Member Country can obtain an apostille, affixed by the foreign Competent Authority on the foreign document to be used in China, which should be a process taking much less time, for example, in Germany, an apostille can, depending on the respective document to be apostilled, often be obtained within 3 to 10 working days. In such situation, the Chinese authorities should then directly recognize the apostille on the foreign official document without the need of further legalization by a Chinese consulate. A similar process shall apply when an apostille is required for a Chinese document to be used in any of the other Member Countries.

At present, the Chinese courts have not yet published any detailed regulations or written confirmations on this topic. However, according to notices published by several Chinese consulates, China’s embassies and consulates abroad will stop providing legalization services after 7 November 2023 in Member Countries.

In the area of Chinese merger control specifically, a draft amendment to guidance document circulated unofficially by the Chinese antitrust authority – the State Administration for Market Regulation (SAMR) – a few weeks ago suggested that, indeed, SAMR plans to directly accept incorporation certificates with an apostille.

It should finally also be noted that by issuing an apostille, the local Competent Authority only certifies the authenticity of the signature and the competence of the authority signing the document. An apostille does not guarantee or authenticate the veracity of the content of the underlying public document. Moreover, certain Competent Authorities (such as the High Court of the Hong Kong SAR) provide databases which allow the public to verify the validity of the issuance of an apostille.

Conclusion

The entry into force of the Apostille Convention and the abolition of the need for legalization of foreign official documents is certainly a positive development for foreign parties who need to submit foreign official documents in China and vice versa.

While the need for legalization of documents such as incorporation certificates and PoAs was often the “long post” in the preparation of Chinese court proceedings, entity incorporations, foreign shareholders’ changes and merger filing processes, it is anticipated that foreign parties will now be able to cut much of the red tape and invest significantly less time and effort in the preparation of formality documents. This is certainly good news for parties involved in time-sensitive proceedings such as the closing of M&A and JV deals or litigation before the Chinese courts.