The Department of Justice today said comments concerning the uncertainty about Hong Kong’s legal environment mentioned in an article in the Asia Business Law Journal are unfair criticisms far from the truth.

As stipulated in the Basic Law and stated by President Xi Jinping in his important speech on July 1, there is no doubt that “one country, two systems” and Hong Kong’s common law system shall long continue in the future, the department pointed out in a press statement.

At the same time, Hong Kong’s common law system has a very strong heritage, under which arbitration enjoys a very good reputation and increasing recognition in the global community. For instance, of the 277 arbitrations submitted to the Hong Kong International Arbitration Centre in 2021, 81.6% were international in nature, 38.3% involved no Hong Kong parties and 7.6% involved no Asian parties.

Moreover, the department noted that Hong Kong’s legislative framework for arbitration is comprehensive and stays abreast of international developments. As an example, in addition to the third party funding of arbitration, Hong Kong has fully implemented the outcome related fee structures for arbitration regime this month, providing flexible funding options to suit the needs of the parties.

Furthermore, the department stressed that Hong Kong enjoys a unique advantage in international arbitration that no other jurisdiction can compete with, which is the breadth and depth of the mutual legal assistance framework established between the Mainland and the city.

In the area of arbitration, Hong Kong has concluded an arrangement and a supplemental arrangement regarding mutual enforcement of arbitral awards, as well as an arrangement concerning mutual assistance in court-ordered interim measures in aid of arbitral proceedings.

Such arrangements enable parties making contracts with Mainland parties or doing business there to resolve disputes using arbitration, which is more effective and convenient, the department explained.

Being the only common law jurisdiction in China, Hong Kong will continue to enhance its mutual legal assistance framework with the Mainland and develop into an international legal and dispute resolution services centre in the Asia Pacific region, the department added.