Hong Kong courts can order interim relief against non-parties—but only sparingly

The decision in Company A and Others v Company B and Others [2018] HKCU 3575 confirms that Hong Kong courts can order interim relief in support of an arbitration, even against a person or entity which is not party to the arbitration. However, that power will be exercised sparingly. Similarly, the court will be slow to grant receivership orders, despite such orders being—in the judge’s words—‘flavour of the season’.
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Filed under Asia, Hong Kong & China, Interim relief, Third-Party Rights

Herbert Smith Freehills opens applications for International Arbitration internships in its market-leading London office

Herbert Smith Freehills is now accepting applications for two internship opportunities in our international arbitration team in London. The programme offers aspiring arbitration lawyers a chance to work within one of the world’s leading specialist arbitration groups.

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Back whence it came: Hong Kong Court remits Award for serious irregularity

A tribunal had decided liability and awarded sums as due on a basis not advanced by the claimant. In P v M [2018] HKCFI 2280, The Hong Kong Court of First Instance decided that this approach breached the “fundamental rule of natural justice that each party should be given the fair and reasonable opportunity to present its case and to deal with the case of its opponent.” The relevant parts of the Award were declared a nullity, and it was remitted to the tribunal to hear submissions on the issues that it had decided were determinative.

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Hong Kong Court Refuses Recognition of Mainland Award on Public Policy Grounds

On 18 October 2018, the Hong Kong Court of First Instance (Court) in Z v Y [2018] HKCFI 2342 refused to recognise an Award of the China Guangzhou Arbitration Commission by reason of public policy. Mimmie Chan J presided and considered the several grounds raised for a set aside order under the Arbitration Ordinance.

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Filed under Enforcement, Hong Kong & China, Uncategorized

English High Court refuses to set aside order for enforcement under s103 in long-running dispute regarding ICC award

The English High Court has refused an application under s.103 of the Arbitration Act 1996 (“AA 1996“) to set-aside an order allowing for the enforcement of an ICC award in England. The decision is the culmination of a long-running dispute in which the award debtor has sought to set-aside the award and prevent enforcement in France, the Seychelles and England. The judgement is the latest illustration of the pro-enforcement approach of the English courts with respect to international arbitral awards, particularly where an award debtor has made efforts in multiple jurisdictions to prevent enforcement against it. While the outcome is not surprising, the level of attention given to the grounds raised by the award debtor, even in the face of issue estoppel, demonstrates the importance placed by the English Court on its New York Convention obligations.

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Filed under Arbitration Act 1996, Challenges to awards, Court intervention, Enforcement, New York Convention

English court sets aside arbitration award for serious irregularity due to tribunal’s non-disclosure of novel point central to award

The odds of successfully challenging an arbitral award in the English Courts on the basis of s68 of the Arbitration Act 1996 (serious irregularity) remain low. In the recent past over 95% of s68 challenges have been unsuccessful and in the period from 2015 to 2017 only 3 out of 112 s68 appeals succeeded, approximately 2.7% of applications made.

However, the English High Court has recently set aside an arbitral award for serious irregularity under s68(2)(a) in the case of RJ and another v HB [2018] EWHC 2833 (Comm). This case is a relatively rare and interesting example of a successful s68(2)(a) challenge.

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Filed under Arbitration Act 1996, Challenges to awards, Court intervention, Europe

Arbitrating in the Kingdom of Saudi Arabia

Arbitration in the Kingdom of Saudi Arabia has been subject to material reform in recent years which has had a positive effect in the realm of dispute resolution. The new arbitration law, enacted by Royal Decree No. M/34 published in the Official Gazette on 8 June 2012 (the “New Arbitration Law”) has facilitated the Kingdom in adopting international norms and practices when promulgating new laws. This New Arbitration Law is broadly modelled on the UNCITRAL Model Law and replaces the previous Arbitration Law issued by Royal Decree No. M/46 on April 25, 1983 and supplemented by an Executive Regulation dated June 22 1987.

The New Arbitration Law has paved the way for the adoption of ‘arbitration friendly’ provisions that facilitate the resolution of disputes in the Kingdom and complement the recent arbitral progress. For example, the UNCITRAL-based New Arbitration Law led to the enactment, in 2013, of a new enforcement law (the “Enforcement Law”).

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Filed under Arbitration laws, Enforcement, Middle East

HKIAC Rules effective today

The HKIAC’s Administered Arbitration Rules 2018 enter into force today, 1 November 2018. See our earlier blog post for details of the updates and innovations.

If you have questions or would like to know more about arbitrating under the updated Rules, please contact Kathryn Sanger, Briana Young or your usual Herbert Smith Freehills contact.

New HKIAC Rules enter into force on 1 November 2018

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Contracting with governments: pitfalls, arbitration, sovereign immunity and enforcement

Entering into a contract with an entity owned or controlled by the state poses unique challenges not faced when dealing with a private commercial counterparty. Parties should be aware of certain distinctive features of negotiating with a state entity from the start of any commercial relationship. It is particularly important for parties to consider these implications when conducting business in the Middle East given that:

i. state entities play a major role in the procurement of major projects, particularly in GCC countries; and

ii. the reconstruction of infrastructure and the development of natural resources in countries such as Iraq require significant foreign investment in the form of contracts with state-owned entities.

Determining whether or not a commercial party is dealing with a state entity is not always a straightforward process in the Middle East. As such, parties should take extra care and consider the following factors at the outset:

a) the capacity of the entity to enter into an arbitration agreement;

b) the ability of the state in question to raise a defence of sovereign immunity in the future; and

c) the investment treaty protections that a company may be able to utilise.

In this article, we set out the key factors that parties should consider when negotiating with a state entity in order to maximise the protections available should a dispute arise at a later point.

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Filed under Advice on State Contracts and Disputes, Arbitration clauses, Middle East, Sovereign Immunity

New HKIAC Rules enter into force on 1 November 2018

The Hong Kong International Arbitration Centre (HKIAC) Council has approved updated Administered Arbitration Rules (2018 Rules). The 2018 Rules are the product of a detailed review, by a committee including Herbert Smith Freehills’ Professional Support Consultant Briana Young, and a robust public consultation process. The 2018 Rules are accompanied by a Practice Note on Appointment of Arbitrators and will enter into force on 1 November 2018.

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Filed under Hong Kong & China, Institutions