New Interim Relief Arrangement Presents Additional Benefit To Hong Kong Arbitration.

17 October, 2019

 

On 1 October 2019, the Arrangement Concerning Mutual Assistance in Court-ordered Interim Measures in Aid of Arbitral Proceedings (the “Arrangement”) between the Courts of the Mainland People’s Republic of China (“PRC”) and of the Hong Kong Special Administrative Region came into force in both Mainland PRC and Hong Kong. The Supreme People’s Court of the PRC and the Department of Justice of the Hong Kong SAR signed the Arrangement in April 2019. As explained in our previous briefing note, the Arrangement allows parties to seek interim Court assistance in Mainland PRC in aid of Hong Kong seated arbitration, and vice versa. With the benefit of the Arrangement, Hong Kong now occupies a unique position in the arbitral sphere: it represents the only arbitral seat worldwide where certain interim measures can be obtained from Mainland PRC Courts that can assist in resolving Mainland PRC-related disputes.

 

The Arrangement applies to arbitration proceedings seated in Hong Kong and administered by one of the following “qualified arbitral institutions” identified by the Arrangement:

 

• Hong Kong International Arbitration Centre
• China International Economic and Trade Arbitration Commission Hong Kong Arbitration Center
• International Court of Arbitration of the International Chamber of Commerce – Asia Office
• Hong Kong Maritime Arbitration Group
• South China International Arbitration Center (HK)
• eBRAM International Online Dispute Resolution Centre

 

The Arrangement, therefore, does not extend to ad hoc arbitrations, which remain the main form of arbitration within certain industry sectors. The Arrangement is retrospective and applies to ongoing arbitral proceedings commenced prior to 1 October 2019 that meet the above criteria.

 

The Arrangement specifically refers to property, evidence and conduct preservation orders as the types of interim measures that can be applied for in Mainland PRC Courts by parties in Hong Kong seated arbitrations. Interim relief can be of critical importance to the success of an arbitration, particularly with respect to the enforcement stage after an award is obtained. Property preservation relief, such as freezing orders, can assist in ensuring any award obtained will be worthwhile whilst an order not to destroy a document can prove invaluable to preserving evidence central to a party’s case.  Such orders will now be enforceable by Mainland PRC Courts to support a Hong Kong arbitration.

 

The Arrangement is likely to change the arbitral landscape and reinforce Hong Kong’s position as the chosen seat for proceedings involving a PRC party, assets or evidence. If you require assistance in navigating the Arrangement or assessing the impact it may have, do not hesitate to get in touch.