Comparative Guides
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Results: 4 Answers
International Arbitration
6.
Applicable law issues
6.1
How is the law of the arbitration agreement determined in your jurisdiction?
 
Hong Kong
The parties are free to elect the law governing the arbitration agreement.

In practice, parties often fail to do so and a dispute may arise as to the which law governs an arbitration agreement. There is no hard and fast rule, but guidance can be found in the Court of First Instance decision in Klöckner Pentaplast Gmbh & Co Kg v Advance Technology (HK) Company Limited [2011] 4 HKLRD 262. It is held that:

…there is no rule that the lex arbitri must be the law of the seat of the arbitration. That is especially so where the law is chosen by the parties. (Klöckner, paragraph 24)

…the starting point must be the terms of the particular clause and the contract in question. First, the contract including the arbitration clause must be examined to see if there is any agreement, express or implied, by the parties as to both the proper law of contract, or the lex arbitri. It is only if agreement cannot be found that the implication arises from the choice of seat, that the law of that place will be the lex arbitri. (Klöckner, paragraph 26)

… it is not permissible to look at the arbitration agreement in isolation, but that regard should be had to the surrounding circumstances including the law governing the substantive contract.” (Klöckner, paragraph 27).

For more information about this answer please contact: Nick Gall from Gall
6.2
Will the tribunal uphold a party agreement as to the substantive law of the dispute? Where the substantive law is unclear, how will the tribunal determine what it should be?
 
Hong Kong
The general principle is to give effect to the parties’ intentions as to where a dispute arising from the contract should be resolved. For instance, most agreements contain a clause expressly stating the substantive law of the dispute.

Where no such clause exists, the tribunal will apply conflict of laws rules in order to determine the substantive law of the dispute (pursuant to Section 64 of the Arbitration Ordinance, adopting Article 28 of the Model Law), which can be very complex.

For more information about this answer please contact: Nick Gall from Gall
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