Author: Shirley Au Yeung

Impact of exclusive jurisdiction clause on Hong Kong insolvency proceedings

In a recent Hong Kong Court of Appeal decision, a bankruptcy petition was dismissed as the underlying debt was disputed and the parties were bound by an exclusive jurisdiction clause in favour of a foreign court. Going forward, where the debt on which a winding up or bankruptcy petition is based is disputed and the parties are bound by an arbitration clause or an exclusive jurisdiction clause in favour of a foreign court, the Hong Kong courts may not allow the petition to proceed, in the absence of strong reasons, pending the determination of the dispute in the agreed forum.