vLex Hong Kong

The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) published final rules on January 15, 2021, implementing the sanctions put in place by Executive Order 13936 (EO 13936) and the Hong Kong Autonomy Act of 2020 (the Act or HKAA). In EO 13936, then President Donald Trump found that Hong Kong was… (See Article)

The Hong Kong government recently announced that the insurance group-wide supervision framework (GWS framework) will commence on 29 March 2021. The GWS framework will be implemented via the Insurance (Amendment) (No. 2) Ordinance 2020, which was passed by the Hong Kong legislature on 17 July 2020. Please see full Publication below for more information. (See Article)

Despite the impact of COVID-19 and other recent developments in Hong Kong, the city’s role as a center for China-based companies to raise capital became even more important in 2020. The momentum of several trends that began developing a year ago has, if anything, played out in a far more pronounced manner than we anticipated. (See Article)

The Labour Tribunal in Hong Kong has jurisdiction over a claim of money arising from the breach of a term of an employment contract. However, mixed claims founded in both contract and tort are excluded from the jurisdiction of the Labour Tribunal. This recently was confirmed in the Court of First Instance (Court) case of Lee Yiu Hong v Well-In Hotel Supplies Company Limited [2020] HKCFI 2760. (See Article)

In Hung Yip (HK) Engineering Company Limited v. Kinli Civil Engineering Limited [2021] HKCFI 153, the Honourable Mr Justice Harris reiterated the test governing when the court will restrain the presentation of a winding-up petition. (See Article)

After eight years of back-and-forth negotiations, Asia’s Regional Comprehensive Economic Partnership on Trade (RCEP), the world’s largest regional trade agreement, was signed in an online ceremony on 15 November 2020. (See Article)

On 22 January 2021 the Association of Southeast Asian Nations (ASEAN) Digital Ministers' Meeting approved the ASEAN Data Management Framework (the DMF) and the Model Contractual Clauses for Cross Border Data Flows (the MCCs). (See Article)

The advantages enjoyed by Hong Kong as a center for arbitration of commercial disputes involving parties in Mainland China have been further enhanced by new measures to strengthen the cross-border recognition and enforcement of such awards. On November 27, 2020, the Supreme People’s Court of China and the government of the Hong Kong Special Administrative Region (the “HKSAR”) signed a Supplemental Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the HKSAR (the “Supplemental Arrangement”). (See Article)

Until recently, the U.S. government treated Hong Kong and China as two separate destinations for export control purposes and in many cases provided Hong Kong with preferential treatment. (See Article)

查看中文 - This update provides an overview of key regulatory developments in the past three months relevant to companies listed, or planning to list, on The Stock Exchange of Hong Kong Limited (HKEx), and their advisers. In particular, it covers amendments to the Rules Governing the Listing of Securities on HKEx (Listing Rules) as well as announcements, guidance and enforcement-related news from HKEx and the Securities and Futures Commission (SFC). Other recent market developments also may be included. We do not intend to cover all updates that may be relevant, but we welcome feedback, so please contact us if you’d like to see analysis of other topics in the future. (See Article)

Updates to NEC4 optional clause X22 – Early Contractor Involvement and its suitability for use in HK, Singapore and elsewhere in Asia. In October 2020, NEC issued amendments to the NEC4 suite. (See Article)

Where notice requirements are clear and unambiguous, those required to give notices should expect them to be strictly enforced. In the recent Court of Appeal decision Maeda Kensetsu Kogyo Kabushiki Kaisha v. Bauer Hong Kong Ltd. [2020] 5 HKLRD 328, a claim that was otherwise valid was disallowed by the court because the subcontractor's notice (which was submitted in time) failed to state the precise contractual provision being relied upon. Please see full Publication below for more information. (See Article)

In response to the growing popularity in the use of external data storage for record-keeping, on 31 October 2019, the Hong Kong Securities and Futures Commission (SFC) issued a circular to licensed corporations (LCs) on the use of external electronic data storage providers (See Article)

Shenzhen Honeycomb System Co Ltd v HCT Technologies (Hong Kong) Co Limited (HCCT 20/2019, [2020] HKCFI 3175, 31 December 2020) confirms the Hong Kong court’s pro-arbitration and pro-enforcement approach. The case involved how the Hong Kong Court of First Instance (the “Court”) approached an attempt to resist enforcement of an arbitral award obtained in Mainland China on the basis of the award debtor’s claim of forgery of the underlying agreement. (See Article)

In X v Y (HCCT 62/2018) [2020] HKCFI 2782 (Date of Decision: 5 November 2020), the Hong Kong Court of First Instance (the Court) set aside an order to enforce an arbitration award on the basis (i) that the tribunal’s findings were beyond the scope of the arbitration clause and the parties submission to arbitration, and (ii) that the respondent in the arbitration had not been given a reasonable opportunity to present its case and to meet the case of the claimant in the arbitration. In her judgment, Mimmie Chan J explained the principles for determining the proper scope of the tribunal’s jurisdiction where a dispute involves a series of connected agreements that are subject to different dispute resolution clauses. (See Article)

Regulators consult on an investor identification regime and outsourcing requirements, and issue guidance on electronic storage of regulatory records and environmental risk management - This blog post summarises key regulatory developments in Hong Kong and Singapore during December 2020, including: ..The SFC’s consultation on an investor identification regime for the securities market ..The SFC’s additional guidance on external electronic data storage ..The MAS’ response to feedback on the proposed guidelines on environmental risk management ..The MAS’ consultation on requirements in relation to the management of outsourced services. (See Article)

In T v W (HCA 366/2020, [2020] HKCFI 2918), the Hong Kong Court of First Instance considered the interesting question of whether a claim made on a dishonoured cheque was caught by and fell within the application of an arbitration clause in the underlying loan agreement in respect of which the cheque was issued. The Loan Agreement and the Cheque - On 22 March 2019, the Plaintiff (as the lender) and the Defendant (as the borrower) entered into an agreement for a loan of HK$5 million with monthly interest of 2.5% (the “Loan Agreement”). (See Article)

The recent case of A v D (HCCT 52/2020) reinforces the pro-arbitration and pro-enforcement approach of Hong Kong courts. Under Article 34 (3) of the Model Law (adopted by section 81 of the Arbitration Ordinance (“Ordinance”)), an application for setting aside an arbitral award may not be made three months after the applicant received the award. (See Article)

On 27 November 2020, the Department of Justice of Hong Kong and the Supreme People’s Court of China signed the Supplemental Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region (the Supplemental Arrangement). The Supplemental Agreement amends and clarifies the Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the HKSAR (the Existing Arrangement) which was signed back in 1999. (See Article)

The use of electronic data storage as a means to store information and documents is increasingly prevalent – generally and amongst licensed corporations. However, regulatory requirements in Hong Kong around keeping of records have historically been restrictive. Whilst respecting the legitimate need for firms to be able to store records in an efficient manner, the Hong Kong regulators have responded on a number of fronts expressing their need and concern that they have continued power to access such records as necessary to fulfil their regulatory obligations, irrespective of where the records are held. Please see full Publication below for more information. (See Article)

After eight years of negotiation, the Regional Comprehensive Economic Partnership on Trade (RCEP), the world's largest regional trade agreement, was signed in an online ceremony on 15 November 2020. The trade deal lowers tariffs, expands services trade, harmonizes rules of origin, and promotes regional trade. Please see full Publication below for more information. (See Article)

It is not uncommon for companies exploring expansion or other ways of raising capital to engage financial advisers to provide a range of consultancy services, including the introduction of potential investors or deals of interest. Please see full Publication below for more information. (See Article)

2020 has been one of the most eventful and unprecedented years for competition law in Thailand. This year, four public hearings have taken place, three industry-specific regulations on unfair practices were issued, the dominance thresholds were amended, the authority has published a detailed merger control manual, and two pre-closing merger approvals were issued – with one landmark case leading to remedies. (See Article)

Counsel and arbitrators give their take on why Hong Kong remains a world class arbitral seat of choice. Key Points: ..Hong Kong courts continue to be independent and take a pro-arbitration and pro-enforcement approach that facilitates the arbitral process. ..HKIAC Arbitration Rules are innovative and progressive, allowing for cost-effective and efficient resolution of disputes, particularly in situations involving multiple parties and/or multiple contracts. ..HKIAC provides a diverse pool of international arbitrators and world-class services that help ensure a smooth arbitration process. ..Hong Kong benefits from its unique status as both a Special Administrative Region of Chin (See Article)

Following our recent Client Alert published in October 2020 on the release of the Section 5(a) Report under the Hong Kong Autonomy Act of 2020 (“HKAA”), there have now been some further updates in relation to U.S. sanctions affecting parties in Hong Kong and China which we discuss below. (See Article)

We all have had to arrange clients to sign the required “statement of truth” concerning the contents of pleadings in court proceedings. Some arbitrators are directing similar signed statements on statements of case and memoranda in arbitrations. (See Article)

Recent annual and quarterly reports published by Hong Kong’s Securities and Futures Commission (the SFC) highlight the SFC’s regulatory work for the period dated April 2019 to March 2020 (the 2019/2020 Period), and the period dated April 2020 to September 2020, respectively. Please see full Publication below for more information. (See Article)

Hong Kong Exchanges and Clearing Limited (the “HKEx”) on 27 November 2020 issued a consultation paper outlining its proposal to increase the profit requirement for listing of shares on the Main Board of HKEx (the “Proposed Profit Requirement”). (See Article)

The Arrangement Concerning Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region (the “Existing Arrangement”) was signed in June 1999 and came into effect in February 2000 (see our post of 29 May 2020). (See Article)

The consultation paper proposes to increase the Main Board Profit Requirement by 150% or 200%. The Stock Exchange of Hong Kong Limited (the Exchange) has published a Consultation Paper on the Main Board Profit Requirement (the Consultation Paper) proposing to increase the profit requirement to align with the market capitalisation requirement for Main Board applicants. Since the introduction of the profit requirement in 1994, the Exchange has maintained the profit requirement despite amendment to other requirements such as the increase in market capitalisation requirement from HK$200 million to HK$500 million in 2018. When introduced in 1994, a new applicant was required to have a minimum a (See Article)