Change without confrontation in China – reciprocal judgements enforcement

The vexed question of extradition, and China’s desire to push through an arrangement on the topic with Hong Kong, has provoked marches and riots on a considerable scale.

But not all changes between the two regions are so confrontational – at the same time, they are coming to agreement on a judicial arrangement which will make civil and commercial judgments equally enforceable in both places.

The Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters between the Courts of the Mainland and of the Hong Kong Special Administrative Region was signed at the end of January.

China’s Supreme People’s Court expects that most civil and commercial judgments, under both Hong Kong and mainland law, should be reciprocally recognised and enforced in both regions.

This agreement significantly improves the situation for those negotiating dispute resolution mechanisms and enforcement options, cutting down the need to litigate twice, in both regions and giving those involved better protection. The arrangement will cover civil judgments, both monetary and non-monetary relief, and costs orders.

It will apply to judgments made on or after the implementation date and will be effected by local legislation in Hong Kong.

How will the arrangement work?

• With a wide scope, it covers a considerable a range of judgments
• Those judgements can come from courts at all levels and from tribunals
• Where a defendant lives, as well as where their business is located, are covered by the arrangement’s jurisdictional conditions
• There are prescriptive grounds for refusal e.g. if a judgment is contrary to basic legal principles of mainland law.

What does this mean for you?

For Hong Kong, the arrangement will enhance its status as a centre for international legal and dispute resolution services. For both regions, the increase in legal co-operation in civil and commercial matters will be welcome.

If you are involved in Chinese enforcement applications, we have both the litigation and international expertise to support you – do get in touch with Claire Holford at [email protected] or Nicolas Groffman at [email protected].

To see how the new arrangement differs from the former mechanisms, take a look at our comparison table here.