Chinese Characters and mod_rewrite

[drag0n]

I am just wondering why a link like this:
http://www.lemmechill.com/Accounting/7/%E7%9A%84%E9%82%A3%E4%BB%BD%E5%91%A2
would return a "400 Bad Request: Server cannot understand error"
Is this because of my url rewrite script not supporting special characters or because of my server not being able to process the information?

The thing is that if I name a folder in my root directory with those type of special characters (such as chinese) and try to access it with a url, it works perfectly.
Also, other languages work good with my url rewrite script. German, French, Spanish all works perfectly.

If its my scripts problem, what do I need to do to fix it?

Thanks