Since the 1950s, arbitration has been the preferred means of dispute resolution in the PRC. To the Chinese, it is perceived to be less adversarial than litigation, because they are influenced by Confucian values to settle matters amicably through moral and ethical principles rather than through law and punishment.2 Moreover, they believe that to lose a litigated case would lead to a loss of face and reputation with business associates.3 To a foreign investor, arbitration offers many advantages over litigation. Most importantly, an award is enforceable across borders because the PRC is a signatory to the New York Convention on the Recognition and Enforcement of Arbitral Awards of 1958.4 But on a more practical level, arbitration provides an alternative to interpreting Chinese law and following its sometimes inconsistent court judgments.