HKIArb head Sylvia Siu says overseas firms nominating Hong Kong as their arbitration centre can proceed with confidence

The adoption of simplified, user-friendly arbitration laws will make it easier than ever for overseas firms to use Hong Kong for contractual dispute resolution, especially in dealings involving the Chinese mainland.

The changes will further position Hong Kong - already recognised as a regional arbitration hub - as a centre for international arbitration.

An amendment proposed by the Hong Kong Institute of Arbitrators (HKIArb) and the Hong Kong International Arbitration Centre (HKIAC) would see current legislation changed to eliminate court supervision, and create one set of laws to deal with both domestic and international cases. This would make Hong Kong's arbitration laws easier for overseas companies to understand - and therefore more attractive, according to president of the HKIArb Sylvia Siu.

"It is hoped this move would entice more overseas companies, whether doing business directly with the Chinese mainland or entering into joint ventures, to use Hong Kong as their platform," Ms Siu said. "By putting a Hong Kong arbitration clause into their contracts - specifying Hong Kong as the place and the Hong Kong Arbitration Ordinance as the procedural law for arbitration - we believe overseas firms can conduct their mainland business with greater confidence."

Hong Kong is already a recognised regional centre for arbitration, with over international 300 cases adjudicated at HKIAC last year - a number far exceeding that of Singapore, Ms Siu said. It has a number of advantages, including geographical proximity to China and other South East Asian countries.

Neutral venue with a pool of talent

"Hong Kong is a neutral venue for arbitration of disputes between a mainland party and, say, a US or European party, or two non-Hong Kong parties," Ms Siu said. 

"Hong Kong has a pool of experienced, bi-lingual arbitrators. It has a wealth of experienced Hong Kong lawyers specialising in common law, as well as many top overseas lawyers who work in well regarded local and international law firms.

"Lawyers in Hong Kong are expert in many disciplines, and particularly well versed in shipping, insurance and international commercial dispute resolution. They are supported by multilingual translators and other arbitration supports as such "live" notes. Overseas parties and their advisors have easy access to Hong Kong, and there are no visa problems."

The ease with which awards made in Hong Kong can be enforced in other jurisdictions is another important factor. This applies to all signatory countries to the New York Convention, and in the Chinese mainland under an agreement to enforce Hong Kong awards at the level of Intermediate People's Court of China. Further, adds Ms Siu, there are many cases arbitrated in Hong Kong using Hong Kong's Arbitration Ordinance as the procedural law and the law of another jurisdiction as the substantive law of the contracts.

The changes were proposed following a review of the current arbitration system. The government has agreed on the framework and will decide on the legislation's ultimate form.

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