HKIAC Reports Record Amount In Dispute For 2023

• Published date: 18 March 2024
• Law Firm: Herbert Smith Freehills
• Author: Ms Kathryn Sanger, Antony Crockett, Helen Tang and Martin Wallace

The HKIAC's recently released statistics for 2023 reveal that the institution had a record-breaking year measured by the amount in dispute, underscoring the appeal of Hong Kong and the HKIAC to international parties as well as their unique role in facilitating the resolution of PRC-related disputes.

The interim measures arrangement between Hong Kong and the mainland PRC continues to be popular with parties and a significant advantage of Hong Kong arbitration for PRC-related transactions. PRC courts have preserved more than US$ 2 billion of assets under the arrangement since it came into effect in 2019, with nearly 95% of applications being granted.

There are also indications that parties and their lawyers are beginning to adopt outcome-related fee arrangements (often referred to as "success fees") for Hong Kong arbitrations after these were permitted for the first time in December 2022.

Caseload and amount in dispute

• The total amount in dispute in all arbitration cases hit a record high of HK$ 92.8 billion (approximately US$ 12.5 billion) more than double the figure for 2022 and 35% higher than the previous record in 2020.
• The average amount in dispute in arbitrations administered by the HKIAC was HK$ 467.6 million (approximately US$ 60.1 million) more than 2.5 times the figure for 2022.
• Total case numbers remained broadly level, with 500 new cases submitted in 2023 versus 515 in 2022.
• There was an increase in domain name disputes both in absolute terms (209 new cases versus 161 in 2022) and as a proportion of the total (42% versus 31% in 2022), while there was a decrease in arbitration cases (281 new cases versus 344 in 2022, representing 56% of the total, down from 67% in 2022).

International appeal

• Three...