China’s mainland and Hong Kong, on 18 January 2019, signed the Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters between the Courts of the Mainland and of Hong Kong (the Arrangement).
This is a critical development for events negotiating dispute decision mechanisms and considering the desire of court provisions. The Arrangement applies to civil judgments and covers both monetary and non-financial remedy. Judgment creditors will not want to start sparkling complaints in the imposing jurisdiction.
The Arrangement will take impact on a date to be introduced, and supersedes the Choice of Court Arrangement signed in 2006 (the 2006 association), which was a long way extra constrained in its scope than the brand new Arrangement.
The new regime has positive implications for doing enterprise with events which have belongings in the mainland or Hong Kong. Parties looking to enforce judgments protected by using the Arrangement will not want to re-litigate their instances when seeking to recover belongings in Hong Kong or the mainland. This will suggest extra actuality and expediency for events litigating in Hong Kong or the mainland and could advantage buyers under the Belt and Road Initiative and in the Guangdong-Hong Kong-Macau Greater Bay Area.
Prior to the Arrangement, the handiest mechanism for mutual popularity or enforcement of judgments between Hong Kong and the mainland was the 2006 arrangement. The 2006 arrangement carried out handiest to industrial contracts and located some of the requirements on those contracts with a purpose to rely upon the 2006 arrangement. It additionally only implemented to cash judgments, not to nonmonetary orders.
The new Arrangement eliminates these barriers. Save for fulfilling positive jurisdictional thresholds, events will now have extra alternatives in determining their preferred dispute resolution mechanism in Hong Kong and the mainland. The Arrangement applies to judgments made on or after its graduation date, however, there can be a transition period for agreements made earlier than the graduation of the Arrangement, wherein case the 2006 association will hold to use.