Steampship Mutual’s Rohan Bray, Director Eastern Syndicate, Hong Kong Office, reports that the Hong Kong Government and Supreme People’s Court of the People’s Republic of China signed up to an arrangement which will mean each can make and enforce orders in aid of arbitrations conducted in the other jurisdiction.
To make it official, the Arrangement Concerning Mutual Assistance in Court-ordered Interim Measures in Aid of Arbitral Proceedings by the Courts of the Mainland and of the Hong Kong Special Administrative Region is the latest in a line of mutual agreements whose purpose is to build bridges between the separate and distinct systems of law in force in Hong Kong and Mainland China.
The arrangement was signed on April 2, 2019; The date of its implementation to come into force will be announced by the Hong Kong Government and the Supreme People’s Court.
Concerning some details of the Arrangement, Article 3 states that prior to an award, a party to Hong Kong arbitration “can make an application for interim measure to the Intermediate People’s Court of the place of residence of the [respondent] or the place where the property … is situated.”
In the possibility that the arbitration has not commenced when the application is made, it should be commenced within 30 days of what is being ordered.
Article 4 highlights the documents and paperwork needed to issue an application. As well as the “application for interim measure”, these include a copy of the arbitration agreement, identity documents of the applicant (e.g. ID card, certificate of incorporation) and details of the claim in arbitration (e.g. pleadings, supporting documents).
If the documents are not in Chinese, an accurate Chinese translation is required. The details required in the “application for interim measure” are set out in Article 5. These include personal and contact details of the parties, preservation amount and information about the property to be preserved, and explanations of the need for urgency and the adverse consequences if the interim measure is not granted.
In addition, Article 8 states that the Mainland Court can order the applicant to provide security, to compensate the respondent in the event that it incurs a loss or damages as a result of an illegitimate or unconscionable application for interim measures. This is similar to the situation where a party looks to arrest a vessel or other maritime property in China to provide security as a pre-condition for the Court granting the order.
The vast majority of maritime arbitrations are what might be termed “ad hoc”. While the LMAA, under whose terms the majority of maritime arbitrations are conducted, is a formal association, with office holders, a constitution and a common code of ethics, it does not itself administer arbitrations in the manner of institutions such as ICC, LCIA, CIETAC, CMAC, SIAC, HKIAC etc. LMAA arbitrations are, therefore, ad hoc in nature. When parties to maritime contracts elect Hong Kong arbitration, they commonly adopt LMAA Rules, use a clause similar to the “Hong Kong Maritime Arbitration Clause” drafted by the Hong Kong Maritime Arbitrators Group, or do not specify any particular set of rules or supervising institution at all. In all such cases the arbitration will be ad hoc.
