Managing the transition in 1997

Uncertainties about the nature and operation of the legal system which will apply in Hong Kong after the change in sovereignty to China in 1997 have, increasingly, prompted parties to commercial contracts to include provisions referring disputes to the jurisdiction of courts outside Hong Kong and al...

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Bibliographic Details
Published in:International commercial litigation 1995-12, p.26
Main Authors: Halford, G R, Linning, A H
Format: Article
Language:English
Subjects:
Choice of law
Commercial law
Contracts
Conventions
Disputes
Effects
Jurisdiction
Nominations
Provisions
Sovereignty
State court decisions
Trials
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Summary:Uncertainties about the nature and operation of the legal system which will apply in Hong Kong after the change in sovereignty to China in 1997 have, increasingly, prompted parties to commercial contracts to include provisions referring disputes to the jurisdiction of courts outside Hong Kong and also having them determined according to another legal system. This is based on the belief that this will insulate the contract from any such uncertainty. A provision in a contract giving a particular court outside Hong Kong the jurisdiction to interpret the contract or to determine disputes arising from its terms is commonly referred to as an exclusive jurisdiction clause. In many cases, the contracting parties also provide that the nominated foreign court apply its own laws to the parties and their disputes. If so, the contract is drafted explicitly to state this in a clause that is commonly referred to as a choice of law clause. While these tactics can be an effective way of removing a dispute from the Hong Kong jurisdiction, the implications involved in choosing the courts and the law should be carefully considered.
ISSN:1359-2750