International Construction Law Review
CORRESPONDENT’S REPORT – HONG KONG
Paul Starr*
INTRODUCTION
Hong Kong continues to experience an exciting period of growth and modernisation when it comes to both international arbitration generally, and to the resolution of construction disputes in particular. In this report, I will highlight and explore a number of the key developments and areas of interest, by way of four sections:
In section 1, I highlight the importance to Hong Kong of China’s One Belt One Road infrastructure initiative (“OBOR”). Construction-related companies and individuals are uniquely poised to join mainland entities in undertaking infrastructure projects throughout the OBOR region. I explain how Hong Kong’s arbitration institutions are well placed to administer the Hong Kong arbitration clauses which the construction industry undertaking OBOR would be well advised to draft. Our industry should also ensure that OBOR projects are set up in such ways as to enable participants to benefit from treaty rights.
In section 2, I demonstrate how the Hong Kong judiciary remains highly supportive of arbitration. The courts have continued to hand down a number of pro arbitration related judgments over the past year. These have, for example, granted ant-suit injunctions to restrain proceedings where there was an arbitration agreement, strengthened the cost penalties for parties opposing stays to arbitration, and stressed the importance of the enforcement of arbitral awards.
Section 3 summarises proposals by The Hong Kong Law Reform Commission, that steps should be taken to amend the Hong Kong Arbitration Ordinance in order to permit and regulate third-party funding of arbitrations. The Law Reform Commission Report provides an important framework for considering and discussing the issues and challenges arising. I highlight a number of key issues – relevant to the debate internationally and not just in Hong Kong.
This year has also seen the implementation of two major pieces of legislation which will affect the construction industry in Hong Kong: the Competition Ordinance and the Third-Party Contracts Ordinance. I consider these along with the consultation on forthcoming Security for Payments legislation in section 4 below.
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