The Guardian-Chinese courts to rule on Hong Kong commercial disputes under new law
January 28, 2024 4 min 677 words
这则报道揭示了中国法院将在香港商业纠纷中行使裁决权的新法律，进一步缩小了香港和中国法律体系之间的差异。虽然旨在减少在与中国大陆有关联的民商事纠纷中重新诉讼的需求，但一些担忧指出，这一法律可能会损害香港作为全球商业中心的声誉。国际公司过去选择在香港设立基地，部分原因是香港提供通往中国大陆的便利，并且通过基于英国普通法的独立法律体系确保在商业争端中获得强有力的法治保护。 然而，这一法令被认为“进一步侵蚀了香港和内地法律体系之间的差异”，这可能引发全球商业精英对香港的担忧。对于在香港批评国家安全法并支持争取民主的人来说，新法可能导致个人安全和资产安全性的担忧增加。此外，担心这一法规将损害香港作为全球财富管理中心的声誉，使得资产管理者不再能够确保客户的投资在香港得到充分保护。这对香港经济和金融体系带来潜在影响，需要仔细权衡法规的长远影响与其意图减少诉讼重复的初衷。
A new law giving Chinese courts the authority to enforce rulings in commercial disputes in Hong Kong comes into effect on Monday, further reducing the barriers between the Hong Kong and Chinese legal systems.
The law puts into effect an agreement signed between China’s supreme people’s court and the government of Hong Kong in 2019 and is designed to reduce the need for re-litigation in civil and commercial disputes, in cases where there is a connection to mainland China.
However, concerns have been raised that the law will tarnish Hong Kong’s reputation as a global business hub. International companies have traditionally chosen to base themselves in Hong Kong in part because the territory provides access to mainland China while ensuring robust rule of law protection in commercial disputes as a result of Hong Kong’s independent legal system, which is based on English common law.
The ordinance “further erodes the differences between the legal systems of Hong Kong and the mainland,” said Andrew Collier, managing director at Orient Capital Research, a financial research firm.
In 2019, a proposed extradition bill, which would have allowed people wanted by the police in mainland China to be deported from Hong Kong, sparked huge protests as millions of Hongkongers decried the erosion of the legal and political barriers between Hong Kong and China.
Those protests evolved into a mass pro-democracy movement, which resulted in more than 10,000 people being arrested. The protests were eventually crushed by a harsh national security law, which Beijing said was necessary to restore stability to the city, but which critics and foreign governments say has been used to criminalise dissent.
Some of the fears about the extradition bill stem from the fact that criminal proceedings in China are influenced by the ruling Chinese Communist party, and criminal courts have a conviction rate of 99%. In civil and commercial matters, however, China’s performance on rule-of-law rankings has improved on international measures in the past 20 years. The World Bank ranks China as being in the top 50% of countries in terms of overall rule-of-law performance. Compared with Hong Kong, commercial disputes in mainland China are dealt with more quickly and at lower cost.
“The reality is that for the most part, it’s not like the mainland civil and commercial courts are completely awful,” said Kevin Yam, a senior fellow at Georgetown University’s Center for Asian Law and former commercial litigator in Hong Kong. But, Yam added, the developments related to the national security law since 2020 have created a backdrop of uncertainty for businesses and wealthy individuals alike. Yam himself is wanted by the Hong Kong police because of his criticism of the national security law and support for the pro-democracy movement.
There is concern that the new ordinance will damage Hong Kong’s reputation as a global wealth management hub. Asset managers may no longer be able to advise wealthy clients with total confidence that their investments would be protected in Hong Kong. “Wealthy Chinese and foreigners alike have been concerned about their personal safety and the security of their assets in Hong Kong, and these judgments will convince many more to move to Asian or western destinations,” Collier said.
The managed assets in Hong Kong amounted to $3,912bn in 2022, down 14% on 2021, according to the Securities and Futures Commission. Many wealthy people, including Chinese citizens, no longer see Hong Kong as being a destination that is out of reach from arbitrary confiscation from mainland authorities.
Nick Chan, the chair of the legal committee of the Hong Kong General Chamber of Commerce, said law-abiding and contract-abiding business people had nothing to worry about: “People who commit financial crime in China … have a lot to lose because they managed to move their assets here under one country, two systems. Under the old arrangement, there wasn’t anything that could be done lawfully to get these potentially stolen assets.”
The ordinance covers civil and commercial matters, with certain exclusions, and also allows for judgments reached in Hong Kong to be enforced in the mainland.