Insights

How to divide the overseas assets of Ningbo divorce? 4 tracing paths

Ningbo Author：LuXu WANG

Once the money is out of the border, many people's first reaction is to forget it and can't reach it. This fear of difficulty is often exactly what the transfer party expects. In fact, domestic procedures are not entirely powerless against property held overseas; the key is to choose the right angle of entry and focus the tracing on the traces left on the territory.

Whether property outside the 1. can be dealt with by domestic courts.

In the rules of the application of the law of foreign-related civil relations, the parties to the property relationship of husband and wife may choose to apply the law of one party's habitual residence, the law of the country of nationality or the law of the place where the main property is located. Procedurally, divorce proceedings accepted by Chinese courts generally apply the law of the place of court to deal with the division of property, but the ability to deal with different types of overseas property varies greatly.

Differences in the treatment of real estate and movable property.

Immovable property located abroad is usually subject to the exclusive jurisdiction of the location of the property, and domestic courts generally do not directly decide on the division, but deal with the domestic property first, and state in the instrument that it will be resolved separately or offset accordingly. Foreign bank deposits, company equity, investment accounts and other movable property, is more likely to be included in the scope of the determination, as a basis for determining the share.

2. Path 1: Reverse foreign assets from domestic traces

foreign assets rarely appear out of thin air, most of which flow out through domestic channels. Traces that can be started include: records of large purchases and remittances from domestic accounts; details of overseas purchases by credit cards; records of foreign investments by domestic companies; and records of tuition fees paid by children studying abroad. These materials are themselves available in the territory. According to the Yinzhou Court's White Paper on the Trial of Marriage and Family Cases (2019-2021), electronic evidence such as WeChat chat and transfer screenshots has many defects in proof and is difficult to accept, while original documents such as bank purchase and remittance vouchers are more powerful, so it is recommended to print or notarize and fix them as soon as possible.

3. Path 2: Application for Entry-Exit and Cross-Border Remittance Records

the contents that can be obtained by the court include the bank's cross-border remittance voucher, the purchase application document and the relevant filing information. There is a limit on the amount of individual annual foreign exchange purchases, and the emergence of multiple purchases close to the upper limit in a short period of time, or the spread of foreign exchange purchases by multiple relatives and remitted to the same offshore account, is often a clear signal of the exit of funds.

The amount of foreign exchange purchases and the clue value of decentralized remittances.

Decentralized foreign exchange purchases require the cooperation of multiple people, which will inevitably leave multiple records of transfers that can be checked in the territory. Corresponding these transfers to the foreign payee at the same time period is sufficient to support the fact that the funds have been transferred, even if it is not possible to freeze the foreign account directly.

4. path three: with the help of overseas procedures and assistance channels

if it is really necessary to claim rights abroad, consideration may be given to instituting separate proceedings at the location of the property, or to requesting access to evidence and service of documents through channels of mutual legal assistance. Such paths are long and costly, are usually economical only when the subject matter is sufficiently large, and should be preceded by an assessment of the openness of the local proceeding to foreign parties and the cost of enforcement.

5. Path 4: Asking for less points on the grounds of transferring property

this path tends to be most pragmatic when the evidence is difficult to close completely. Article 1092 of the the People's Republic of China Civil Code stipulates that if the joint property of husband and wife is hidden, transferred, sold, destroyed or squandered, the division may be divided less or not. As long as it can be proved that the funds have left the country and the purpose is unknown, you can request a corresponding tilt in the distribution of domestic property.

To what extent is proof enough?

This claim does not require proof of the specific balance of the offshore account, but only the formation of a reasonable chain of funds leaving the country and not being used for the family's common life. The holder has the obligation to explain the large amount of outbound funds, and if the explanation is unclear or inconsistent, the adverse consequences are generally borne by it.

Realistic Considerations in 6. Negotiation and Implementation

judgments of foreign property are often faced with the difficulties of recognition and enforcement, so the value of mediation and reconciliation is particularly prominent. Possible options include offsetting domestic property against foreign interests, agreeing to pay in instalments and setting up a guarantee, or having the holder issue a commitment and cooperate with the transfer. Getting an enforceable domestic consideration is usually better than a hard-to-land split clause.

7. case proof

in practice, if one party organizes multiple relatives to purchase foreign exchange and remit it to the same overseas account within one year before the prosecution, and cannot explain the reasonable use, the court generally finds that it is a transfer of the joint property of the husband and wife, and the amount transferred is more converted into its share. In similar cases, the amount of division or compensation is usually in the range of $100000 to $3 million, depending on the size of the property and the circumstances of the evidence. The claim to transfer property is also premised on evidence: according to the divorce dispute between Chang mou and Meng mou heard by Ningbo jiangbei court, the defendant claimed that the plaintiff derailed and transferred the property. due to insufficient evidence, the court did not believe it, and the house, vehicle and insurance policy were still divided according to the confirmed value-it can be seen whether the evidence chain is complete and directly determines whether the claim of less points can be established.

In practice, when real estate located abroad is involved, domestic courts usually do not directly decide on the division, but first deal with domestic real estate, deposits and state in the document that the foreign part will be resolved separately; if the parties have obtained a decision on the real estate at their location, they may apply for recognition and enforcement separately. In similar cases, the amount of division or compensation is usually in the range of $100000 to $3 million, depending on the size of the property and the circumstances of the evidence.

8. Risk Alert

  • A preconceived waiver: a determination that foreign property cannot be disposed of and not claimed is tantamount to an automatic alienation of shares.
  • Focus only on foreign accounts: ignoring domestic purchase and remittance vouchers, but losing the most easily obtained evidence.
  • Missed preservation opportunity: If domestic assets are disposed of simultaneously, there may be no property available for enforcement after the judgment.
  • Blind initiation of offshore proceedings: prosecution abroad without assessing the cost and cycle, the cost may exceed the value of the subject matter.
  • Credulous verbal promises: the other party promised to return the funds after returning home but did not set up a guarantee, the performance stage is often not investigated.
  • Ignoring choice of law: Failure to specify the applicable law in the agreement may result in an adverse legal outcome in the event of a dispute.

9. FAQ

the other party bought a house abroad, can the Chinese court award me half?

Generally, the division of foreign real estate is not directly decided. The court shall deal with the domestic property first, and state that the foreign part shall be settled separately, and if necessary, the corresponding offset may be made in the domestic distribution.

Can't find the balance of the offshore account, can you still claim it?

You can. As long as it can be proved that the funds have been transferred from the territory and the purpose is unknown, they may request a small share in the division of domestic property in accordance with the provisions on the transfer of common property.

Both parties are Chinese nationality but live abroad, can they return home for divorce?

Usually it can. If both parties are Chinese citizens and settle abroad, they can be accepted by the court of one party's original domicile or residence when the legal conditions are met, and the case review shall prevail.

Can you agree on which country's law applies to property disputes?

The property relationship between husband and wife allows the parties to choose to apply the law of one party's habitual residence, the law of the country of nationality or the law of the place where the main property is located, and it is recommended to make a clear agreement in writing.

Practical Experience of 10. Lawyers

don't be deterred by the saying that "money can't be reached when it is out of the border". The starting point is precisely the traces left in the territory. The first step is to make a map of the flow of funds: from which domestic account the money went out, when, in what name, to whom it was remitted, the corresponding foreign exchange purchase vouchers, cross-border remittance records, and related information of overseas companies or insurance are all clues. After you sort out these threads first, you will know which stroke to pursue, which direction to look in, which can fall to the ground and which cannot be moved temporarily.

The path of tracing can be advanced in parallel. One is to reverse overseas assets from traces within the territory; one is to apply to the court for access to records of entry and exit and cross-border remittances; one is to use overseas procedures or related assistance channels; and the other is to claim that the other party has less points in the division on the grounds of transferring property. Which path works depends on the type of asset itself-real and movable property outside the country, with very different processing capacity-and whether the other party has enforceable property in the country. So first judge the feasibility and then decide how much effort to put in.

We should have a clear understanding of the choice: foreign-related cases have a long cycle and high cost. We should first evaluate the "catch up and carry out" before deciding how much money to put down. At the same time, apply for property preservation as soon as possible to prevent the other party from continuing to move out. If the offshore part is really difficult to deal with directly at the moment, it can be converted into a claim for compensation for domestic common property, or as a bargaining chip to fight for a tilt in the distribution of domestic assets. Jurisdiction and legal application also have their own attention. Before starting work, confirm the path clearly, and don't file a case before finding the wrong direction.