Profiles of Hong Kong Major Service Industries
Content provided by:
TDC logo

Last updated: 5 October, 2006
Email ThisRate ThisDownload to PDAPrint Friendly

Arbitration and Mediation



Overview
  • Hong Kong is a prime venue for commercial dispute resolution with its mature and well-developed legal system.

  • Hong Kong has an enormous pool of experienced professionals available to support commercial dispute resolution.

  • Arbitration awards made in Hong Kong are enforceable through the courts of most of the world's trading economies.

  • Compared to other venues for arbitration in Asia, Hong Kong probably handles the largest number of cases in which neither party is local.

  • Chinese mainland companies are increasingly using Hong Kong as an arbitration centre. Increasing opportunities will arise when more foreign investors or traders transact with companies on the Chinese mainland after WTO accession. Many foreign investors prefer to settle disputes in a "third" place. Hong Kong is a suitable "third" place for settling disputes involving Sino-foreign projects.

Industry Data

-

2005

Number of Arbitration Cases Involving HKIAC

281

Commercial

98

Construction

104

Shipping

48

Others

31
Source: Hong Kong International Arbitration Centre


Range of Services

Arbitration is a legal process through which awards are issued to the disputing parties by arbitrator(s) rather than the court. In 2005, 281 cases were carried out under the umbrella of the Hong Kong International Arbitration Centre (HKIAC). A large number of arbitrations are also conducted in Hong Kong privately.

The Hong Kong Arbitration Ordinance is widely recognised as one of the most advanced arbitration statutes in the world. Arbitration awards made in Hong Kong are enforceable through the courts of most of the world's trading economies through its being a party to the New York Convention. These awards are also enforceable on the Chinese mainland since the establishment in 2000 of the arrangement on mutual recognition and enforcement of arbitral awards between the SAR and the mainland. The Model Law on International Commercial Arbitration of the United Nations Commission on International Trade Law (UNCITRAL) has been used for international arbitrations held in Hong Kong.


Service Providers

Arbitrators are generally recognised senior experts from professions capable of understanding the technical issues involved in an arbitration. They can therefore be lawyers, accountants, engineers, architects or quantity surveyors. This means that the providers of arbitration services are scattered throughout professional services firms in an economy. Thus, prime centres for arbitration are often major commercial centres in their own right.

Being a leading commercial centre in Asia, Hong Kong has strong expertise in commerce, finance, information technology, business law, shipping and construction with an enormous pool of experienced professionals available to support commercial dispute resolution.

There are four institutions linked to arbitration and mediation services in Hong Kong. The Hong Kong International Arbitration Centre (HKIAC), the Hong Kong Institute of Arbitrators (HKIArb), the Chartered Institute of Arbitrators (CIArb) and the International Chamber of Commerce (ICC).


Exports

Compared to other venues for arbitration in Asia, Hong Kong probably handles the largest number of cases in which neither party is local. For instance, of the 250 arbitrations cases (excluding domain name disputes) handled by the Hong Kong International Arbitration Centre (HKIAC) during 2005, 180 cases involved Hong Kong and foreign companies, 30 cases involved both parties that were non-Hong Kong companies, with the remaining 40 cases involving both parties that were Hong Kong companies. For cases which involved solely non-Hong Kong companies, they included parties from the Chinese mainland, US, UK, Singapore and South Korea.

Also worth noting is that even mainland companies are increasingly using Hong Kong as an arbitration centre. Arbitration cases in which both parties involved were mainland companies and Hong Kong was specified as the place of arbitration rose from nil prior to 1997 to 15 in 2005.


Industry Development and Market Outlook
  • In recent years, arbitration and mediation have gained in popularity as alternatives to resolve disputes without resorting to traditional litigation. Probably, more international commercial arbitrations have taken place in Hong Kong than in any other city in the region.

  • Increasing opportunities will arise when more foreign investors or traders transact with companies on the Chinese mainland after WTO accession. Many foreign investors prefer to settle disputes in a "third" place. Hong Kong is a suitable "third" place for settling disputes involving Sino-foreign projects.

More Industries