HONG KONG SAR, CHINA Law and Practice Contributed by: Frederick Hui and Samuel Li, Zhong Lun Law Firm
That said, “group” or multiparty arbitration is possible where the relevant arbitration agreements and appli - cable rules (for example, those of HKIAC) permit it. These rules may allow the joinder of additional parties, the consolidation of related arbitrations, or concur - rent proceedings before the same tribunal. The main requirements are that the parties have so agreed (expressly or through compatible arbitration clauses), that the disputes are sufficiently connected, and that any rule-specific conditions (including timing) are met. 13.2 Ethical Codes The parties’ lawyers are mainly governed by the pro - fessional rules of their home jurisdiction. If they are qualified in Hong Kong, they must follow the Bar Code of Conduct (for barristers) or the Solicitors’ Guide to Professional Conduct. Foreign lawyers can act in arbi - trations seated in Hong Kong without being locally admitted, but if they appear before the Hong Kong courts, local rights of audience rules apply. The AO sets the legal framework for arbitrations. It places duties on the arbitral tribunal, including to act independently and impartially, to treat parties equal - ly, and to give each party a reasonable opportunity to present its case. The AO also provides for con - fidentiality of arbitral proceedings, and related court proceedings are generally heard in private (subject to limited exceptions). Arbitrators are bound by the statutory duties under the AO, including duties of independence and impartial - ity and an ongoing duty to disclose any circumstanc - es that might reasonably give rise to doubts about this. The grounds and procedures for challenging or removing an arbitrator broadly follow the Model Law. The parties’ chosen institutional rules and practice guides often impose further detailed requirements on issues such as conflicts, availability, confidentiality and efficient conduct of the case. In addition, parties and tribunals often rely on widely used international guidelines, such as the IBA Guide - lines on Conflicts of Interest in International Arbitration and the IBA Rules on the Taking of Evidence. General Hong Kong laws (for example, on data privacy and anti-money laundering) may also affect how lawyers and arbitrators conduct themselves. Overall, Hong
Kong applies a combination of statute, institutional rules and internationally recognised guidelines to regulate arbitral conduct. 13.3 Third-Party Funding Hong Kong expressly permits third-party funding of arbitration and court proceedings connected with arbitration under Part 10A of the AO, supported by a Code of Practice issued on 7 December 2018. Fund - ing is allowed where the seat of the arbitration is Hong Kong, and also for work done in Hong Kong on arbi - trations seated elsewhere. A funded party must disclose that it has funding, and the identity of the funder, to the other parties and the “arbitration body” (ie, the tribunal, arbitral institution or court) at the start of the arbitration or within 15 days after the funding agreement is made. Any termination of the funding must also be disclosed. Lawyers acting for a party are not permitted to act as the funder in accordance with Part 10A of the AO. The Code of Practice imposes detailed obligations on funders. These include maintaining minimum capital adequacy (access to at least HKD20 million and suf - ficient resources to meet liabilities for 36 months), entering into clear written funding agreements (cov - ering limits on control, exposure to adverse costs or security, and restricted termination rights), and having proper procedures for managing conflicts of interest and complaints. Funders must also protect confi - dentiality and legal privilege, maintain a Hong Kong address for service, and remind funded parties of their disclosure obligations and right to independent legal advice. An advisory body monitors compliance with the Code through information requests and annual returns. Separately, Hong Kong allows certain outcome-relat - ed fee arrangements for lawyers in arbitration (such as conditional fee agreements and damages-based agreements) under rules effective from 16 December 2022. These rules concern lawyers’ fees and are dis - tinct from third-party funding. 13.4 Consolidation In Hong Kong, the courts do not have a general power to consolidate arbitrations. Their power arises only if
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