Originally from World Arbitration and Mediation Review

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China and Hong Kong Agree on Reciprocal Recognition and Enforcement of Judgments

On July 14, 2006, the Hong Kong Special Administrative Region (“Hong Kong”) and the
People’s Republic of China (the “Mainland”) signed an Arrangement on Reciprocal Recognition
and Enforcement of Judgments in Civil and Commercial Matters by Courts of the Mainland and
of the Hong Kong Special Administrative Region Pursuant to Choice of Court Agreements
between Parties Concerned (the “Arrangement”). The Arrangement provides the framework for
the mutual recognition and enforcement of final judgments in civil and commercial matters of
designated courts of Hong Kong and the Mainland and is expected to come into force in early
2007.1

Although the Mainland resumed the sovereignty of Hong Kong in 1997, separate legal
systems continue to operate in Hong Kong and the Mainland respectively as part of the principle
of “one country two systems.” Once implemented, the Arrangement will provide a mechanism
by which parties may enforce their rights under the judgment of a designated court. The
Arrangement is a long-awaited development which is expected to further strengthen Hong
Kong’s position as a favorable choice of venue for resolution of commercial disputes involving
Mainland China.