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Dispute Resolution

Third Party Arbitration Funding given green light in Hong Kong

On 14th June 2017 the Hong Kong Legislative Council passed the third reading of the Arbitration and Mediation Legislation (Third Party Funding) (Amendment) Ordinance. Whilst the Ordinance has not yet come into effect, it is expected to be gazetted and become effective later this year.

This legislation will permit the legalization of the third party funding in relation to arbitration and mediation proceedings in Hong Kong and is expected to provide a considerable boost to Hong Kong's position as an international arbitration centre.

Hong Kong has been careful to ensure that the legislative change is accompanied by relevant safeguards to protect the system from potential abuse and we believe it is a welcome development and will help Hong Kong to maintain its status as one of the world's leading dispute resolution centres.

Clients should now be considering the use of dispute resolution clauses adopting Hong Kong arbitration in commercial contracts, given the prospect of litigation funding being available for the resolution of such disputes by arbitration as opposed to proceeding through the court system.


If you would like further information regarding this legislation or any of the issues referred to in this article, please feel free to contact our Richard Healy.

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