By Marine Vanhoucke and Laurent Eugene
If you have obtained a decision in your favour in an overseas jurisdiction against a Hong Kong company or individual, the key question for you would be whether or not this judgment can be enforced in Hong Kong.
A court decision cannot be enforced overseas without first being recognised by the relevant countries concerned, and Hong Kong is no exception to this principle.
French courts are issuing an increasing number of decisions against non-French companies, including many registered in Hong Kong. According to French law, to enforce a judgment by a French court in an overseas jurisdiction, there is an obligation to comply with the ‘Exequatur procedure,’ and this procedure may vary depending on the overseas jurisdictions involved.
Enforcement in Hong Kong
The enforcement of French or other foreign judgments can be obtained in two ways: either registering the decision with the Court of First Instance or bringing a new legal action.
As far as France is concerned, the exequatur procedure that must be followed is the former - registering the decision with the Court of First Instance. There is no need to bring new legal action and start the whole process from the beginning again.
When you have obtained a conviction against a Hong Kong company, the core considerations before moving forward are the following:
1. Is the defendant solvent in Hong Kong?
2. Is the judgment final?
3. Does the decision order payment of monetary damages?
If the answers to these three questions are affirmative, you can then consider the next steps to take.
Once the defendant's solvency in Hong Kong is established, it is possible to proceed with the registration procedure, which is provided for in the Foreign Judgments (Reciprocal Enforcement) Act Cap 319. This text enables the enforcement of foreign judgments by registering decisions from superior courts in designated countries with reciprocal arrangements with Hong Kong. These designated countries include Australia, Bermuda, Brunei, India, Malaysia, New Zealand, Singapore, Sri Lanka, Belgium, France, Germany, Italy, Austria, the Netherlands, and Israel.
Under these provisions, the beneficiary of a French court's decision may apply to the Court of First Instance in Hong Kong for registration.
Here are some of the conditions to be met (this list is not exhaustive):
• the decision must relate to the payment of a sum of money;
• the decision must be final and not subject to appeal;
• the decision must be issued by a civil or commercial court; and
• the application must be filed within six years of the final decision from the foreign jurisdiction.
Once the decision is registered in Hong Kong, a notification will be served to the defendant, and the decision can be enforced in the same way as the decisions by local courts.
Security for Costs
A critical specificity in Hong Kong, is that the local court can ask the plaintiff seeking enforcement for security in the form of a deposit. It is well-established in Hong Kong that a foreign plaintiff may be ordered to deposit a sum in court, known as the ‘Security for costs’ when starting legal proceedings.
The security for costs aims to cover part of the defendant’s estimated litigation costs in defending an action brought by a foreign plaintiff. When the defendant successfully defends the action, the amount of its legal costs that normally would be payable by the foreign plaintiff, would be secured by the security for costs.
Therefore, depending on the amounts involved, this can act as a deterrent for overseas plaintiffs as they may not want to have a significant financial sum locked up in Hong Kong.
As mentioned above, this procedure of registration at the Court of First Instance is only available for a specific list of countries (including France). Therefore, for other jurisdictions you should always check if the jurisdiction issuing the decision to be enforced in Hong Kong is also on this list. If not, the possibility of bringing a new legal action based on the foreign judgment remains open.
No Requirement for Reciprocity
This procedure is possible even if the decision does not emanate from a common-law jurisdiction as there is no requirement for reciprocity. A decision rendered by a court in a jurisdiction that does not recognize a judgment made by a Hong Kong court may still be enforced in Hong Kong if all the conditions are met.
Should you wish to enforce a foreign decision in Hong Kong, and more specifically a decision issued by a French judge, it is highly recommended to contact a Hong Kong lawyer to discuss the best way forward.