Key trends and updates: dispute resolution in China

  • When deciding whether to litigate or arbitrate, factors to consider include type of contract, remedies, who is counterparty, whether likely to be plaintiff/defendant and sense of urgency
  • In selecting seat of arbitration, things to think about include neutrality, ability to choose own arbitrators, cultural affinity, whether party to New York Convention, costs, language and what deal making culture is like
  • Innovative features arbitration centres may offer are emergency relief and expedited procedures

Cross-border enforcement – what to be aware of

  • Increasing number of bilateral investment treaty disputes involving China with Belt and Road Initiative, need to have court decisions recognised
  • Challenge to have foreign court judgments recognised in China, but things may be improving with China signing Convention of Choice of Court on September 12, 2017
  • In the last 30 years, only six foreign court judgments have been recognised in China
  • When drafting dispute contractual clauses, items to factor in are jurisdiction, governing law, language, limitation periods, address and mode of service, and personal liability

Navigating issues in cross-border disputes

  • In-house lawyers face challenge of navigating civil law jurisdictions as common law lawyers
  • Differences in legal systems mean different levels of transparency, whether there is discovery, statutory remedies, availability of interim relief and enforcement of awards
  • Where there are multi-lateral parties to a contract, in-house lawyers need to be aware of uneven clauses between parties
  • Tips for in-house lawyers: don’t underestimate resourcing, beware of cross-cultural challenges especially in countries where confrontation is not part of business culture

Developments in third party funding in Asia

  • Third party funding ordinance passed in Hong Kong in June 2017
  • Code of conduct expected to come in for law to be fully implemented
  • Outstanding issues to be decided include which body should be responsible for monitoring implementation and who should form advisory committee
  • Singapore also allowed third party funding in March 2017 but focuses on commercial funders
  • On average, funders look for between three to ten times the value of the claim but still need to appeal to claimant as number of funders is on the increase

Conducting regulatory investigations in the region

  • Strong emphasis on anti-money laundering issues and labour code in Taiwan in past 12 months
  • Hong Kong is seeing more heightened accountability of senior officers in businesses through the Manager in Charge regime
  • Trend towards more scrutiny of the Securities and Futures Commission on IPO sponsors
  • With Stock Connect and Bond Connect, cooperation increasing between Hong Kong and Chinese regulators on market manipulation
  • China Securities Regulatory Commission’s measure on conduct of compliance officer to watch out for
  • Cybersecurity gaining more importance with Wannacry and Equifax cases

Alternative dispute resolution: a guide

  • In mediation, most common pitfall for parties is taking an over-aggressive approach
  • Parties need to come to table with genuine interest to mediate
  • Mediation fails when it is used as a tactic for one party to find out the party’s case and/or to cause delay
  • Most common for parties to interview mediator to see if good candidate
  • Qualities to look for in mediator include communication skills, neutrality and cultural fluency
  • Experience and industrial expertise good to have but not always the most important

Top trends in IP and cyberlaw disputes

  • Domain name disputes on the rise especially in China where it is easy and cheap to register domain names
  • Hangzhou cyber court created in China in August 2017 to speed up cases
  • Comparing Uniform Domain Name Dispute Resolution Policy (UDRP) and Uniform Rapid Suspension System (URS), URS is a faster process (average 17 days vs. two to three months for UDRP), but burden of proof higher and requires trade marks to be registered

Regional developments in investment treaty arbitration

  • Increasing number of investor state disputes for Central Asia
  • Trend of India to retreat to domestic courts vs. China being more proactive in engaging with international arbitration
  • Notable difference in how Hong Kong has created bilateral investment treaties mostly with Western European countries and less so with countries along with the One Belt One Road compared to China
  • Three-quarters of One Belt One Road countries have been involved in investment disputes
  • Innovative features emerging in international investment arbitration to include review mechanisms and investment courts