November/December 2009 / Features
Arbitration in China and Hong Kong
Both China and Hong Kong have long traditions of arbitration and offer viable venues for parties choosing to arbitrate business disputes. Because of Hong Kong’s legal history and the retention of its legal system following the 1998 handover to China, foreign parties view the The Hong Kong International Arbitration Centre as a fair tribunal for international disputes, while due to its cultural and geographic proximity to the mainland, Chinese parties regard the HKIAC as an international venue that is sensitive to domestic concerns.
The Hong Kong Arbitration Ordinance governs arbitrations in the region. Parties also may conduct ad hoc arbitrations and use rules from other institutions. HKIAC arbitrators have the power to direct discovery and grant interim relief. They are not bound by the rules of evidence.
The China International Economic and Trade Arbitration Commission resolves disputes between foreign parties and Chinese enterprises. If the parties agree, CIETAC’s arbitrators may also act as mediators. Parties may have to provide an arbitrator with confidential information during the mediation phase, so Western attorneys tend to disfavor it.
Parties seeking to enforce awards rendered outside of China or Hong Kong in those territories must rely on the New York Convention of 1958. Under its terms, courts of signatory states enforce arbitration awards made in other signatory states.
