Hong Kong's Role in Russian-Chinese Relations

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China and Russia: Hong Kong at the intersection of big business and big politics as a global dispute resolution venue

Reporter:  Olga Boltenko and Kaiyu Liu (Fangda Partners, Hong Kong)

On Thursday, 1 November 2018, the historic Helena May Club in Hong Kong opened its doors to the arbitration community to welcome the Consul General of the Russian Federation in Hong Kong, His Excellency Mr. Alexander V. Kozlov, and The Right Honourable Lord Peter Goldsmith QC, for an evening of speeches and debates on the role of Hong Kong in the Russian-Chinese relations.

The lecture was organised by the Russian Consulate General in Hong Kong and supported by Fangda Partners.  Mr. Peter Yuen, the managing partner of Fangda Partners’ Hong Kong office, moderated the lecture.

His Excellency Mr. Kozlov set the scene by introducing the various Russian-Chinese investment and trade projects that are structured through Hong Kong. He noted that the launch of the Belt & Road Initiative has seen more economic opportunities for both China and Russia, and in particular Hong Kong, given its position as an international dispute resolution centre.

Lord Peter Goldsmith QC spoke about how Hong Kong has emerged to become a dispute resolution venue of neutrality, reliance, integrity and high quality of the judiciary.

His Lordship listed the contemporary events of profound importance that challenge the political and economic landscape of the modern world, including the trade stand-off, Brexit, and a number of others, and noted that despite the uncertainty generated by these events, certain fundamental principles remain unchanged in Hong Kong. Those principles are the rule of law and the independence of the judiciary.  In support of his proposition, Lord Goldsmith cited the Sino-British Joint Declaration, the Basic Law, and the landmark cases decided by the Hong Kong Court of Final Appeal that continue to inform the judicial thought in Asia.

Lord Goldsmith explored the meaning assigned to the concept of “judicial independence”, which is understood, in simple terms, to mean “the ability of courts and judges to perform their duties free of influence or control by other actors, whether governmental or private.” He then cited the Basic Law and the Sino-British Joint Declaration that both affirm Hong Kong’s high degree of autonomy including the power of final adjudication, and looked into the composition of the Court of Final Appeal and the statements made by the judges.

Further, Lord Goldsmith highlighted Article 158 of the Basic Law that authorises the courts of Hong Kong to interpret, in adjudicating cases, the provisions of the Basic Law which are within the limits of the autonomy of the Region, and that also grants the Standing Committee of the National People’s Congress the power to interpret the law — but only in three distinct circumstances.  Since 1997, the Standing Committee of the National People’s Congress issued only very few interpretations: in 1999 (regarding the right of abode), in 2004 (regarding the election of the Chief Executive), in 2005 (regarding the replacement of the Chief Executive), in 2011 (regarding the doctrine of sovereign immunity), and in 2016 (regarding taking of the oath for offices at the Legislative Council).  The very few Article 158 interpretations in that context are the affirmation of the Basic Law rather than its affront.

Lord Goldsmith then moved on to describe Hong Kong as a neutral dispute resolution venue that caters to arbitration disputes in Asia and beyond.  He noted that Hong Kong was a pioneer Asian jurisdiction to adopt an UNCITRAL-based arbitration ordinance.  He then gave statistics on enforcement of awards in Hong Kong and in China.  He concluded by expressing his absolute confidence in Hong Kong as an excellent choice for seat of arbitration not only for its high level of accessibility, availability and adaptiveness, but also for the quality and independence of its judiciary, its enforcement record, and its reliance on the principles of the rule of law.

Mr. Peter Yuen of Fangda Partners concluded the evening echoing Lord Goldsmith’s remarks on the independence, neutrality and high quality of the Hong Kong judiciary and noted that, going forward, such high standards may exert a positive influence on the judiciary in the Mainland China, which has already come a long way since its establishment.

The floor was then opened to questions. David Tweed, a political correspondent at Bloomberg, asked Lord Goldsmith whether the Basic Law and the Sino-British Joint Declaration are infallible legal instruments that in their own right can guarantee Hong Kong’s judicial independence for the years to come, including post 2047. Other questions related to the Russian-Chinese relations and the position of Hong Kong as a neutral dispute resolution venue as compared to other Asian jurisdictions.

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