Recently, representing a leading multinational enterprise (the "Client") in a contractual dispute with a domestic Chinese partner (the "Counterparty"), GEN Law successfully secured a favorable ruling from the Xiamen Intermediate People's Court. The court ruled to recognize and enforce the "Interim Award" issued by the arbitral tribunal of the Hong Kong International Arbitration Center (HKIAC) in accordance with the law. The ruling requires the Counterparty to immediately reimburse the Client for the initial deposit advanced on their behalf in the arbitration proceedings and to bear all costs associated with this application for recognition and enforcement.
Case Background
The dispute arose during the execution of a Cooperation Agreement signed between the Client and the Counterparty. To protect its legitimate rights and interests, GEN Law, representing the Client, initiated arbitration proceedings at the HKIAC.
Following the commencement of proceedings under the 2018 HKIAC Administered Arbitration Rules, both parties were required to pay arbitration fees in a timely manner. Regrettably, the Counterparty failed to pay its share of the tribunal fees, administrative fees, and the initial deposit by the deadline. To ensure the arbitration proceedings could continue without obstruction, the Client advanced the corresponding payments on the Counterparty's behalf.
Arbitration Award Process
The arbitral tribunal first confirmed that the case had been properly submitted to the HKIAC and would be adjudicated under the Arbitration Rules. Subsequently, GEN Law formally applied to the tribunal on behalf of the Client, requesting an order for the Counterparty to reimburse the initial deposit advanced by the Client, along with accrued interest.
In response to GEN Law’s application, the tribunal issued an "Interim Award," explicitly ordering the Counterparty to immediately reimburse the full amount advanced by the Client. According to the Arbitration Rules, this "Interim Award" carries final and binding legal effect on both parties.
Application for Recognition and Enforcement in Mainland Courts
Despite the clear ruling from the arbitral tribunal, the Counterparty failed to fulfill its payment obligations. To effectively safeguard the Client’s interests, GEN Law acted swiftly. Citing the Arrangement of the Supreme People's Court on the Mutual Enforcement of Arbitral Awards between the Mainland and the Hong Kong Special Administrative Region (the "Arrangement") and relevant laws, the team submitted an application to the Xiamen Intermediate People's Court for the recognition and enforcement of the "Interim Award." Upon review, the Court ruled in favor of the Client, supporting all claims in full.
Professional Analysis and Practical Significance
1. Seamless Coordination and Enforcement of Cross-Border Awards
This case successfully achieved the recognition and compulsory enforcement of a Hong Kong-seated arbitral award in a Mainland court. It serves as a powerful testament to the practicality and authority of the Arrangement in facilitating the mutual recognition of arbitral awards between the Mainland and Hong Kong.
2. The Enforceability and Value of Interim Awards
In past Mainland judicial practice, there have been varying interpretations regarding whether "Interim Awards" issued by Hong Kong arbitral institutions could be recognized and enforced with the same weight as final awards. In this case, the Xiamen Intermediate People's Court clarified a crucial point: an "Interim Award" does not lack finality or binding force simply because of the word "Interim" (or "Partial") in its title. It can be recognized and enforced just as a final award would be. This ruling provides a clear judicial precedent for the enforceability of such awards in the Mainland.
3. High-Efficiency Collaboration and Professional Expertise
Leveraging extensive experience in cross-border dispute resolution, the GEN Law team exercised precise control over key stages of the process, including evidence marshalling, the application of legal grounds, and procedural coordination, ensuring the maximization of the Client's rights and interests.
Conclusion
As economic ties between the Mainland and Hong Kong deepen, cross-border disputes involving contract performance and commercial cooperation are becoming increasingly common. The HKIAC remains a leading global arbitration institution, and the pathway for recognizing and enforcing its awards in the Mainland is becoming progressively smoother. For enterprises, incorporating arbitration clauses into contracts and selecting authoritative institutions provides a solid safeguard for the efficient resolution of future disputes.
The successful enforcement of this award not only highlights the systemic advantages of judicial cooperation between the Mainland and Hong Kong but also underscores GEN Law’s professional capabilities in the realm of cross-border arbitration and enforcement. GEN Law remains committed to providing clients with premium, efficient, and comprehensive cross-border dispute resolution services, empowering enterprises to operate with compliance and stability.
