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• Synopsis Of Hong Kong Stock Exchange’s New Guide For New Listing Applicants

  In an effort to enable new listing applicants and their advisers to systematically and conveniently navigate all new listing-related guidance, The Stock Exchange of Hong Kong Limited (the “HKEX”) published the Guide for New Listing Applicants (the “Guide”) on November 29, 2023. A few things to note with respect to the Guide...

• Hong Kong Issues Guidance on Automatic Share Buyback Programs

  The SEHK guidance sets out the framework for its assessment in considering a waiver application of the increasingly popular automatic share buyback program. The Stock Exchange of Hong Kong Limited (the SEHK) has issued a guidance letter on automatic share buyback programs conducted on behalf of listed issuers (GL117-23) (the Guidance Letter). The Guidance Letter provides the framework for granting a waiver to allow an issuer to conduct an automatic share buyback program on the SEHK and continue the program throughout restricted periods. Please see full Alert below for more information.

• Hong Kong and BVI Courts Differ on Whether Noteholders Have Standing to Petition for Winding-Up

  The Hong Kong Court confirmed that noteholders with beneficial interest in global notes do not have standing to present winding-up petitions against issuers. Meanwhile, the BVI Court reached the opposite conclusion in a separate case. In the recent case of Re Leading Holdings Group Limited [2023] HKCFI 1770, the Hong Kong Court of First Instance (Court) decided, for the first time, on the issue of the locus of an investor of a global note to present a winding-up petition as a contingent creditor. Please see full Alert below for more information.

• Hong Kong Court Confirms Enforceability of Keepwell Deeds

  Two recent landmark decisions provide valuable guidance on this commonly used form of credit enhancement. Keepwell deeds have in recent years grown into a common form of credit enhancement used by companies in mainland China for offshore bonds issued by their subsidiaries. Under a typical keepwell deed, a parent company in mainland China undertakes to ensure that its offshore issuer subsidiary will remain solvent and that it will have sufficient liquidity in order to meet payment obligations under the bonds. This structure is designed to avoid the mainland parent needing to obtain regulatory approvals to overcome restrictions on mainland businesses borrowing in foreign currencies as well as currency exchange limitations in servicing and repaying such borrowings. For similar reasons, it is important that a keepwell obligation falls short of an outright guarantee and most are carefully drafted to avoid this outcome. Once a keepwell obligation has been triggered, the mainland parent will be required to obtain regulatory approvals in order to perform it. Please see full Alert below for more information.

• Hong Kong Court Orders Winding-Up of Company Despite Parties’ Arbitration Agreement

  A recent ruling shows that an arbitration agreement alone is not necessarily a complete defence to a Hong Kong winding-up petition. The Hong Kong Companies Court recently issued a winding-up order against a debtor company, despite the presence of arbitration clauses in the agreements giving rise to the debt. In Re Simplicity & Vogue Retailing (HK) Co., Limited [2023] HKCFI 1443, Linda Chan J refused to apply the ratio in the Court of Final Appeal’s decision Re Guy Kwok Hung Lam [2023] HKCFA 9 (Guy Lam) (discussed in a previous Client Alert), in which the underlying dispute over the petition debt was the subject of an arbitration clause. Please see full Alert below for more information.

• New Era Dawns for Hong Kong’s Virtual Assets Sector

  The regulatory perimeter continues to expand as the Securities and Futures Commission introduces a comprehensive regime to regulate virtual asset service providers. This Client Alert reviews key obligations and requirements which the new regime will impose on virtual asset trading platforms (VATPs). The Client Alert also discusses next steps for those considering to apply for a licence and assesses the current virtual asset legal and regulatory framework in Hong Kong. Please see full Alert below for more information.

• Hong Kong Court of Final Appeal Rules on Exclusive Jurisdiction Clauses in Insolvency

  A bankruptcy petition should not proceed if the debt is disputed and subject to an exclusive jurisdiction clause in favour of a foreign court. The Hong Kong Court of Final Appeal (CFA) has ruled that if a bankruptcy petition is disputed and the disputed debt arises from an agreement containing an exclusive jurisdiction clause (EJC) in favour of a foreign court, the dispute should be resolved in accordance with that EJC. In particular, the Hong Kong courts should decline jurisdiction in a bankruptcy (and by extension, a winding-up) petition pending resolution of the dispute in a foreign court, absent countervailing factors such as the risk of the debtor’s insolvency affecting other parties, the debtor’s reliance on a frivolous defence, or an abuse of process. Please see full Alert below for more information.

• Bankruptcy Petition vs Exclusive Jurisdiction Clause

  Who has the last word? The effect of an exclusive jurisdiction clause on insolvency proceedings - On 4 May 2023, the Court of Final Appeal (CFA) handed down its much-awaited judgment in Re Guy Kwok Hung Lam [2023] HKCFA 9. This decision is significant. It clarifies the proper approach in deciding whether to dismiss or stay a creditor’s bankruptcy petition before Hong Kong courts, where the underlying petition debt arises from an agreement containing an exclusive jurisdiction clause (EJC) in favour of a foreign court. In this article, our insolvency, litigation and arbitration specialists consider the practical implications of this decision. Please see full Publication below for more information.

• Hong Kong Court Confirms the Proprietary Nature of Cryptocurrencies but Denies Clients’ Proprietary Claims

  This is the first decision by the Hong Kong Court on whether clients of a crypto exchange have proprietary claims to cryptocurrencies held on the platform. It confirms that cryptocurrency constitutes property under Hong Kong law. Key Points: • Cryptocurrency constitutes property under Hong Kong law and can therefore form the subject matter of a trust. • Whether cryptocurrencies stored on cryptocurrency exchanges are held on trust for their customers will depend on the construction of the contractual terms and conditions governing relationships between the cryptocurrency exchange platform and its customers. The court will also assess the operational reality of the exchange, including how assets are actually maintained and applied by the exchange. • Crypto owners and users should ensure that they understand the effect of the terms and conditions of the cryptocurrency exchange and carefully scrutinise any proposed updates to such terms before accepting them. Please see full Alert below for more information.

• Report on Hong Kong-Listed Biotech Companies - April 2023

  点击此处阅读调查报告全文 Our third annual report on Hong Kong-listed biotech companies examines how the sector performed during the challenging conditions for capital markets globally over the past 12 months. Although aggregate listing and subsequent fundraising activity for biotech firms in Hong Kong decreased over the past year, Hong Kong continues to serve a thriving biotech ecosystem and is well positioned to attract further companies to list as global market conditions recover. The report provides a comprehensive overview of the market in its current state, examining key data points for biotech companies undertaking IPOs on the Stock Exchange of Hong Kong Limited (HKEX) in calendar year 2022 and analyzing the corporate governance practices of all 56 biotech companies listed on HKEX as of December 31, 2022. Please see full Report below for more information.

Featured documents

• SFC Licensing Guidance for Private Equity Firms

  The Hong Kong Securities and Futures Commission (SFC) issued a circular (Circular) on January 7, 2020, which clarifies that private equity firms conducting, or holding themselves out as conducting, regulated activities in Hong Kong would be required to be licensed by the SFC under the Securities...

• Technology, Media and Telecommunications Review – Hong Kong

  Hong Kong has one of the most developed telecommunications and internet services markets in the world. Its legal and regulatory system promotes competitiveness while at the same time striving to enhance and facilitate business investment. Please see full Chapter below for more information....

• Luxury retailers in Hong Kong and neighboring markets face Coronavirus crisis

  Over the past nine months in Hong Kong, luxury retailers have encountered a challenging market. Hong Kong has traditionally been a popular destination for Mainland Chinese seeking to purchase luxury goods, but recent political unrest and consequent protests have seen a dramatic reduction in cross-bo...

• Arbitration or winding-up: Debt collection in Hong Kong following Lasmos

  Lasmos Limited v Southwest Pacific Bauxite (HK) Limited - Before the topical Lasmos decision in March 2018, the general position, where a company faced with a winding-up petition wanted to have it struck out, was for the company to demonstrate that it had a bona fide dispute on substantial...

• Security of Payment in Hong Kong - pilot programme for public works contracts

  As the old saying holds, cash-flow is the life blood of the construction industry. In 2021, Hong Kong looks set to join Singapore, Australia and other jurisdictions in implementing a Security of Payment regime to regulate payment practices and provide a system to protect cash flow in the...

• “Right-Sizing” Hong Kong Commercial Leases: Key Issues to Consider in the Context of Business Disruption & COVID-19

  Business disruption seems to have become the new norm in Hong Kong in the last 12 months or so. The first quarter of 2019 was dominated by news of a regional slowdown caused by the US/China Trade War. The second half of the year was characterised by frequent protests on the streets, in the malls...

• Part 3 of 6: Amendments to Hong Kong Data Protection Law Regarding the PCPD’s Sanctioning Powers

  To enhance protection of personal data protection, the Hong Kong government currently is considering to raise the level of fines for offences under the Personal Data (Privacy) Ordinance and exploring the feasibility of imposing administrative penalties for contravention of the PDPO. This article...

• Hong Kong Capital Markets Update - Weathering the COVID-19 Corona Virus Outbreak

  Many still recall the SARS outbreak, which caused a slowdown in the economy and a plunge in the stock market, properties market and capital markets deal flow during that period. Years later, people would look back and regret not seizing the buying opportunities. While sentiments were low at that...

• Hong Kong Corporate and Regulatory Insights - March 2021

  The Stock Exchange of Hong Kong Limited (SEHK) seeks views on reforms to enhance listing regime for overseas issuers SEHK published a consultation paper, Listing Regime for Overseas Issuers, seeking public feedback on proposals to enhance and streamline the listing regime for overseas issuers... ...

• COVID-19 and Business Interruption Insurance

  The novel coronavirus, now officially named COVID-19 by the World Health Organisation, has become a global pandemic. Nearly all sectors of business in Asia are significantly affected, ranging from hospitality, entertainment, tourism, food and beverage to supply chain and logistics. Insurers are...