[3] The first judicial bridge between Hong Kong and the mainland turned out to be this?
Compiled from: Qingdao Intermediate Court
On September 26, 2019, the Supreme People's Court issued the "Arrangement of the Supreme People's Court on Mutual Assistance in Preservation in Arbitration between the Mainland and the Hong Kong Special Administrative Region" (referred to as the "Arbitration Preservation Arrangement"), allowing parties to Hong Kong arbitration proceedings to apply to the People's Courts in the Mainland for preservation, and parties to Mainland arbitration proceedings to apply to the Hong Kong SAR courts for injunctions and other interim measures.
Case review
In April 2019, the applicant, a Hong Kong company, signed a sales contract with the respondents, a Qingdao logistics company and a Qingdao group company. During the performance of the contract, disputes arose among the parties. The applicant Hong Kong company initiated arbitration with the Hong Kong International Arbitration Centre in accordance with the contract. During the arbitration, the applicant applied for property preservation. According to the provisions of the "Arbitration Preservation Arrangement," the Hong Kong International Arbitration Centre issued a certification letter, which, along with notarized materials such as the property preservation application, was forwarded to the Qingdao Intermediate People's Court.
The Qingdao Intermediate Court, upon review, found that the applicant's property preservation application to ensure the enforcement of the effective award complied with the provisions of the Arbitration Law of the People's Republic of China, the Civil Procedure Law of the People's Republic of China, and the Supreme People's Court's Arrangement on Mutual Assistance in Preservation between Mainland China and the Hong Kong Special Administrative Region in Arbitration. The Qingdao Intermediate Court granted the application on March 12, 2021, and implemented preservation measures on March 15, 2021.
After learning that the court had taken preservation measures against them in accordance with the law, the respondent proactively contacted the applicant. Both parties reached a settlement on March 17, 2021, and the respondent immediately fulfilled the debt. Currently, the applicant has filed an application with the court to lift the property preservation. This Hong Kong-related commercial dispute, involving an amount of nearly 100 million yuan, was successfully resolved during the preservation stage of the arbitration proceedings.
The Supreme People's Court's Arrangement on Mutual Assistance in Preservation between Mainland China and the Hong Kong Special Administrative Region in Arbitration
Article 3
Parties to Hong Kong arbitration proceedings may, before the arbitration award is made, apply to the intermediate people's court of the mainland where the respondent's domicile, property, or evidence is located for preservation, in accordance with the provisions of the Civil Procedure Law of the People's Republic of China, the Arbitration Law of the People's Republic of China, and relevant judicial interpretations. If the respondent's domicile, property, or evidence is located within the jurisdiction of different people's courts, the application shall be made to one of those people's courts, and not to two or more people's courts separately.
Article 4
(1) A preservation application; (2) An arbitration agreement; (3) Identity documents: if the applicant is a natural person, a copy of the identity document shall be submitted; if the applicant is a legal person or an unincorporated organization, a copy of the registration certificate and a copy of the identity document of the legal representative or responsible person shall be submitted; (4) If the preservation application is made after the arbitration institution or permanent office has accepted the arbitration case, the arbitration application documents containing the main arbitration claims and the facts and reasons on which they are based, as well as relevant evidence materials, and a letter of certification from the institution or permanent office confirming acceptance of the arbitration case shall be submitted; (5) Other materials required by the mainland people's court.
Article 5
The preservation application shall include the following: (1) Basic information of the parties; (2) The request, including the amount of property to be preserved, the content and duration of the application for behavioral preservation, etc.; (3) The facts, reasons, and relevant evidence on which the request is based, including an explanation of urgency, such that failure to preserve immediately would cause irreparable damage to the applicant's lawful rights and interests or make it difficult to enforce the arbitration award; (4) Clear information or specific clues about the property or evidence to be preserved; (5) Information on mainland property or credit certificates used to provide security; (6) Whether an application under this arrangement has been made in other courts, institutions, or permanent offices, and the status of such application; (7) Other matters that need to be stated.
[1] The author's perspective
The effectiveness of the Arbitration Preservation Arrangement marks the first time the mainland has provided preservation assistance to arbitration proceedings in another jurisdiction, granting mutual local treatment in preservation measures between the two regions and strengthening equal protection of the legitimate rights and interests of the parties.
The implementation and application of the Arbitration Preservation Arrangement is a beneficial practice in building a diversified dispute resolution mechanism through joint consultation, joint construction, and shared benefits between the two regions. The Arbitration Preservation Arrangement not only achieves the unity of legal, social, and political effects in resolving Hong Kong-related commercial disputes but also provides stronger judicial support for arbitration as a dispute resolution method within the diversified dispute resolution mechanism.
