HONG KONG SAR, CHINA Law and Practice Contributed by: Frederick Hui and Samuel Li, Zhong Lun Law Firm
12. Enforcement of an Award 12.1 New York Convention
restrictive regime, including exceptions for commer - cial activities and arbitration-related matters. This may allow recognition and enforcement proceedings, and potentially execution against assets used for commer - cial purposes, subject to important carve-outs (such as diplomatic, military and central bank property). However, the precise application in Hong Kong is still developing and will depend on the facts of each case. 12.3 Approach of the Courts Hong Kong courts take a strongly pro‑enforcement approach to arbitral awards. The grounds for refusing enforcement follow those in the New York Convention and are interpreted narrowly. In particular, the “public policy” exception sets a very high threshold, as confirmed in key decisions such as Hebei Import & Export Corp v Polytek Engineering Co Ltd (1999) 2 HKCFAR 111. The Court of Final Appeal has made clear that enforcement will only be refused if it would violate Hong Kong’s most fundamental con - ceptions of morality and justice. Courts will not reopen the merits of the dispute, and they usually give sig - nificant weight to decisions made by the courts at the seat of the arbitration. They also emphasise comity (mutual respect between courts) and caution against using public policy as a broad or catch‑all objection. Where challenges to enforcement are clearly unmeri - torious, the court may order indemnity costs. 13. Miscellaneous 13.1 Class Action or Group Arbitration Hong Kong law does not recognise US-style class arbitration. There is no mechanism that allows one claimant to arbitrate on behalf of a wider group of people who have not agreed to arbitrate. Arbitration is based on consent: an award binds only the par - ties to the arbitration (and, in limited cases, certain non-signatories under recognised legal doctrines). While the courts allow representative proceedings in some circumstances, that procedure does not give an arbitral tribunal power to bind a wider class that has not agreed to arbitration. In practice, claims involving multiple claimants must therefore be pursued in court or brought as separate individual arbitrations.
The People’s Republic of China acceded to the 1958 New York Convention on 22 January 1987, subject to the reciprocity and commercial reservations under Article I(3). Following the resumption of sovereignty of Hong Kong on 1 July 1997, China notified that the Convention would apply to the Hong Kong on the same terms. In Hong Kong, the Convention is imple - mented through the AO. 12.2 Enforcement Procedure Procedures and Standards Hong Kong adopts a pro-enforcement approach. An award creditor usually applies to the Court of First Instance without notifying the other party (ex parte) for permission (leave) to enforce the award. The applica - tion must exhibit the award, the arbitration agreement, and certified translations if needed. The court may decide the application on the papers or list a hearing. If leave is granted, the award can be enforced as if it were a Hong Kong court judgment. Once served with the order, the award debtor has 14 days to apply to set it aside. The grounds for refusing or setting aside enforcement mirror those in the New York Convention and are interpreted narrowly by Hong Kong courts. If leave is refused, the creditor may still bring a claim on the award at common law. Awards Set Aside or Under Challenge at the Seat If an award has been set aside by the court at the seat, Hong Kong courts have a discretion (not an automatic rule) to refuse enforcement. In practice, enforcement of an annulled award would be unusual and likely only in exceptional circumstances. If set-aside proceed - ings are ongoing at the seat, there is no automatic stay. The Hong Kong court may adjourn the enforce - ment proceedings and can order the award debtor to provide security, taking into account factors such as the strength of the challenge at the seat and any prejudice caused by delay. Sovereign Immunity at Enforcement The position regarding sovereign immunity is evolving. Following the PRC’s Foreign State Immunity Law (in force from 1 January 2024), Hong Kong is expected to move from an absolute immunity approach towards a
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