HONG KONG SAR, CHINA Law and Practice Contributed by: Christopher Andrew Potts, Crump & Co
5.8 Other Ways of Obtaining Attachment Orders Besides ship arrests, Hong Kong courts offer other possibilities of obtaining attachment orders to obtain security. Mareva (Freezing) Injunctions These restrain a defendant from removing or dissipat - ing assets, in order to preserve assets pending judg - ment or arbitration. They can cover assets domestic or worldwide (eg, bank accounts, receivables, shares, properties). Plaintiff must show and provide: • a good arguable case and full disclosure; • a real risk of dissipation or removal of assets; and • almost invariably, an undertaking to compensate the defendant if the injunction is wrongly granted. Attachment/Garnishee Proceedings These allow a claimant to attach debts owed to the defendant by third parties (eg, freight or charter hire), most commonly post-judgment, thereby creating security. Interim Injunctions Over Specific Property The court may restrain dealings with identifiable prop - erty (such as cargo, bunkers, or sale proceeds) locat - ed within Hong Kong to preserve it pending determi - Arbitral tribunals can order security for a claim, includ - ing requiring security for unliquidated claims. A party involved in maritime arbitration can apply to the court for an order to arrest a vessel to obtain security for their claim. This ensures that if the claimant wins the arbitration, there will be assets available to satisfy the award. Security for Costs nation of the dispute. Security in Arbitration This refers to a procedural order requiring a claim - ant to provide security for the defendant’s legal costs where there is a risk of non-recovery, rather than secu - rity for the substantive claim.
to the bailiff is required to pay the costs and expenses for the arrest, custody and preservation of the vessel. The bailiff will normally require an initial deposit on account of these expenses after the arrest. 5.6 Arresting Bunkers and Freight Freight may be arrested, as freight is recognised as arrestable property under admiralty jurisdiction where it is payable to the person liable in personam and is identifiable within the jurisdiction. By con - trast, although arresting bunkers is not theoretically impossible, bunkers are not expressly recognised as independently arrestable property in Hong Kong; therefore, bunker-only arrest is generally impractical. Bunkers may only be caught incidentally upon arrest of the vessel itself, and only while they form part of the ship. In practice, claimants typically arrest the vessel as primary security or seek alternative remedies such as injunctions, while Hong Kong law provides a clear mechanism for arresting freight directly in appropriate cases. 5.7 Sister-Ship Arrest A claimant may arrest a sister-ship only if: • the claim is a maritime claim; and • the same person who was liable in personam for the claim (i) was the beneficial owner (as to all shares) or demise charterer of the offending ship when the cause of action arose, and (ii) is the beneficial owner (as to all shares) or demise char - terer of the sister-ship at the time the writ in rem is issued. Important Considerations Only one vessel can be arrested per claim, even though multiple ships can be named in the in rem writ. The claimant must prove identical beneficial owner - ship of both vessels. Hong Kong does not allow arrest of an “associated ship”. Time charterers and voyage charterers do not qualify.
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