56 57 CHAPTER 3 through arbitration in a foreign jurisdiction shall not be deemed invalid solely on the grounds of the absence of any foreign-related factor. Notably, following the implementation of the Regulation of the Qianhai Shenzhen-Hong Kong Modern Services Cooperation Zone in late 20204 and the comprehensive reform of the Qianhai Shenzhen-Hong Kong Modern Services Cooperation Zone (“Qianhai Corporation Zone”), WOKEs currently registered in Qianhai are poised to reap remarkable benefits in terms of flexibility for the choice of law, including Hong Kong law, for their civil and commercial contracts, regardless of the absence of “foreign-related elements.” This groundbreaking development is a testament to the practicality of WOKEs adopting Hong Kong law and facilitating arbitration proceedings in Hong Kong. Consequently, a surge in the demand for Hong Kong legal services is expected, fueled by the ongoing expansion of the Qianhai Cooperation Zone. Furthermore, this presents additional opportunities for active participation from the Hong Kong legal sector in propelling the growth and advancement of the GBA. According to data from the Authority of Qianhai ShenzhenHongkong Modern Service Industry Cooperation Zone of Shenzhen, the Qianhai Court has emerged as a leading innovator in the legal field with its revolutionary “Hong Kong Jurors” and “Hong Kong Invited Mediator” System5. As of the end of August 2023, 920 cases have been handled by Hong Kong jurors, and 661 cases have been successfully mediated by Hong Kong mediators. Impressively, in 2022, the Qianhai Court successfully handled 184 extraterritorial law cases, with 121 instances adjudicated based on Hong Kong laws6. This achievement not only reaffirms the Qianhai Court’s leading position but also presents significant opportunities for dispute resolution practitioners in Hong Kong. With the newfound flexibility to choose Hong Kong law, these professionals can expand their expertise and client base. Additionally, Hong Kong legal professionals can actively participate in Qianhai international arbitration in various roles, including as arbitrator, mediator, agent, expert, or witness. The presence of seven Guangdong Hong Kong Macao joint law firms in Qianhai further enhances collaboration opportunities. This development solidifies Hong Kong’s status as a premier international arbitration hub and paves the way for further growth and success in the dynamic field of dispute resolution for Hong Kong practitioners. The 2023 Policy Address recognizes the advantages of flexibility in the Qianhai Cooperation Zone and emphasizes the promotion of Hong Kong law and arbitration seated in Hong Kong for the WOKE initiative. These efforts aim to expand the mechanism beyond Shenzhen, Qianhai and the Mainland Free Trade Pilot Zone to cover the entire GBA. Additionally, there is a focus on encouraging Mainland enterprises, including stateowned ones, to adopt Hong Kong law and to utilize its dispute resolution services, particularly in contractual disputes. If this proposal is successfully implemented, it would have a significantly positive impact on Hong Kong’s arbitration sector. Businesses in Shenzhen and the entire GBA would benefit from Hong Kong’s exceptional legal system for resolving disputes, solidifying its position as a leading global arbitration hub and attracting more businesses to choose Hong Kong as their preferred venue for dispute resolution. Consequently, it would further enhance Hong Kong’s reputation for delivering efficient and trustworthy arbitration services. ESTABLISHMENT OF THE AALCO HONG KONG REGIONAL ARBITRATION CENTRE IN MAY 2022 The Asian-African Legal Consultative Organization (“AALCO”), originally known as the Asian Legal Consultative Committee (“ALCC”), was established on 15 November 1956. As an intergovernmental legal consultative organization, AALCO fosters cooperation and understanding among Asian and African countries. With the inclusion of 48 member states over time, AALCO focuses on legal matters, international law, and dispute resolution, providing a platform for dialogue and collaboration7. Hong Kong’s strategic positioning within the region and its role as a gateway to the Belt and Road initiative makes it an ideal location for AALCO’s regional arbitral centre out of all the Asian cities8 . This decision significantly impacts the development of the arbitration sectors in Hong Kong within the GBA. With the support of the Central People’s Government and the Hong Kong Government, the AALCO Regional Arbitration Centre was established in Hong Kong, further recognizing Hong Kong’s dispute resolution capabilities and reinforces Hong Kong’s position as an essential hub for resolving international disputes in the GBA and the Belt and Road Initiative. The cooperation between AALCO and Hong Kong in the field of arbitration will further strengthen 4 Section 57 of the Regulation of the Qianhai Shenzhen-Hong Kong Modern Services Cooperation Zone 5 InvestHK, “Qianhai Court Building a New Mode of Judicial Talent Exchange in the Greater Bay Area” (https://gba.investhk.gov.hk/en/business-insights/qianhai-court-building-newmode-judicial-talent-exchange-greater-bay-area.html) 6 Authority of Qianhai Shenzhen-Hongkong Modern Service Industry Cooperation Zone of Shenzhen, “前海，尚“法”” (http://qh.sz.gov.cn/sygnan/lssj/content/post_10813475.html) 7 Asian-African Legal Consultative Organization, “About Us” (https://www.aalco.int/about) 8 AALCO Hong Kong Regional Arbitration Centre, “About Us” (https://aalcohkrac.org/about-aalco-hong-kong-regional-arbitration-centre/) Unveiling the National 14th Five-Year Plan: Pioneering Hong Kong’s recent development as the Leading Legal and Dispute Resolution Hub in the Dynamic Greater Bay Area Serving as China’s global gateway and a window to the world, Hong Kong has long become an attractive destination for resolving disputes, thanks to its adherence to the common law system, which shares similarities with significant economies like the United Kingdom, the United States, and Australia etc., and the Hong Kong Special Administrative Region Basic Law, which guarantees the judicial independence and the rule of law. This article explores the recent advancement in dispute resolution in Hong Kong, propelled by the Central People’s Government’s development strategy outlined in the National 14th Five-Year Plan. It examines the latest initiatives implemented by Hong Kong to fortify its position as a preeminent global legal hub, emphasizing the strategic congruence between the vision of the Central People’s Government of the People’s Republic of China (“CPG”) and the burgeoning growth of Hong Kong’s arbitration and mediation sectors. Furthermore, it discusses the profound impact of the Guangdong-Hong KongMacao Greater Bay Area (“GBA”) development on bolstering Hong Kong’s prominence in dispute resolution within the Asia Pacific region. BACKGROUND With high-quality legal services, arbitration-friendly legislation, government support, and the global enforceability of arbitral awards, Hong Kong continues to thrive as a prominent hub for dispute resolution within the GBA and to solidify its position in the region’s dynamic landscape. According to a 2021 survey by the School of International Arbitration at Queen Mary University of London, Hong Kong retained its position as the third most favoured location for arbitration worldwide, following closely behind London and Singapore1. NATIONAL DEVELOPMENT STRATEGY AND THE CENTRAL PEOPLE GOVERNMENT’S SUPPORT FOR HONG KONG With the backing of the CPG, Hong Kong is strategically positioned to seize the immense opportunities presented by the National 14th Five-Year Plan and the GBA Development Plan. The objective outlined in Sections 1 and 2 of Chapter 61 of the National 14th Five-Year Plan explicitly supports Hong Kong’s development as a prominent hub for international legal and dispute resolution services in the Asia Pacific region. This policy endorsement places Hong Kong in a favourable position to leverage its inherent strengths and to elevate its global stature in international legal and dispute resolution services. WHOLLY HONG KONG-OWNED ENTERPRISES (WOKE) TO ADOPT HONG KONG LAWS AND ARBITRATION TO BE SEATED IN HONG KONG Historically, WOKE and joint ventures established by Hong Kong investors in Mainland China were regarded as Mainland legal entities according to the laws of the People’s Republic of China. In principle, in cases lacking any foreign-related aspects2, Mainland parties are prohibited from referring disputes to an arbitral institution outside Mainland China for arbitration. Yet, recent progressive changes in PRC law have provided an exception. Pursuant to Article 9(1) of the Opinions of the Supreme People’s Court on Providing Judicial Guarantee for the Building of Pilot Free Trade Zones (Fafa [2016] No. 34)3, in the case of WOKEs registered within Mainland China’s Pilot Free Trade Zones, their decision to resolve disputes 1 School of International Arbitration of Queen Mary University of London, “2021 International Arbitration Survey: Adapting Arbitration to a Changing World” (https://arbitration.qmul.ac.uk/research/2021-international-arbitration-survey/) 2 Reply to the request for confirmation of dispute resolution between Jiangsu Aerospace Wanyuan Wind Power Equipment Manufacturing Co., Ltd. and Elm Wind Energy Vane Products (Tianjin) Co., Ltd. from Supreme People’s Court, (2012) Min Si Ta Zi, No.2 (https://law.wkinfo.com.cn/legislation/detail/MTAxMDAwOTgxODA%3D) 3 Article 9(1) of the Opinions of the Supreme People’s Court on Providing Judicial Guarantee for the Building of Pilot Free Trade Zones (Fafa [2016] No. 34) (https://cicc.court.gov.cn/html/1/219/199/411/681.html) CHAPTER 3
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