Understanding the Momentous Mainland-HK Cross-Border Insolvency Arrangement
Understanding the Momentous Mainland-Hong Kong
Cross-Border Insolvency Arrangement
21 April 2022
By developing the common law on judicial assistance, the courts of Hong Kong have succeeded to some extent to meet the challenges arising from the many cases of insolvent companies from the Mainland which were listed in Hong Kong but incorporated in offshore jurisdictions. On the other hand, section 5 of the Mainland’s Enterprise Bankruptcy Law provides that, in the absence of treaties, Chinese courts may recognise foreign insolvency proceedings based on reciprocity. Unfortunately the Mainland has not entered into any treaty with another jurisdiction, and the meaning of reciprocity is heavily contested. On 14 May 2021, the Mainland signed an agreement with Hong Kong for mutual recognition and assistance in cross-border insolvencies in the two jurisdictions. This talk seeks to explain how this momentous development was achieved; in particular, how the Mainland adapted ideas and provisions from the UNCITRAL Model Law on Cross-Border Insolvency (Model Law) to meet the Mainland’s conflicting objectives of development and risks control. It will also be shown that the agreement remains a work in progress, as reflected in cases decided after the coming into force of the agreement, which foreshadows further developments in practice to overcome hurdles and debates between old doctrines in private international law and the new doctrines typified by the Model Law.
WEE Meng Seng is an Associate Professor, Co-Director of the Asian Law Institute and Deputy Director and Head (Corporate Law) of the EW Barker Centre for Law & Business at the Faculty of Law, National University of Singapore (NUS). He obtained his LLB from NUS and BCL (First Class) and DPhil from Oxford. He teaches and researches on corporate insolvency law and company law. He has published articles in flagship journals in the UK and Singapore and his writings have been cited by fellow academics and the courts, including the Singapore Court of Appeal and the Australian Federal Court. He has been a visiting professor at universities in China and has delivered public lectures and given seminars at universities in the UK, China and India. He was a member of the Insolvency Law Review Committee appointed by the Singapore government to make recommendations to reform Singapore’s personal and corporate insolvency laws. He has served as a consultant to government bodies and been instructed by local and international law firms.
Emily LEE is the Director of the Asian Institute of International Financial Law (AIIFL) and Associate Professor at the Faculty of Law of the University of Hong Kong. Her research interests are in the fields of financial law, FinTech regulations and policies, corporate insolvency law, cross-border insolvency law and comparative law. Her research work has been published by leading peer-reviewed journals such as the American Journal of Comparative Law, Law and Contemporary Problems, Journal of Corporate Law Studies, Journal of Business Law and Common Law World Review. She is also a member of the United Nations Commission on International Trade Law (UNCITRAL)’s expert group.
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