Hong Kong looks to cash in on arbitration market

A delegation from Hong Kong has visited Yangon last week to promote their territory’s business arbitration service, which helps to resolve disputes over contested commercial and industrial contracts.

The 20-member delegation is seeking to win business away from Singapore, whose firms handle the majority of arbitration cases involving Myanmar companies. During its visit it met representatives from the Yangon Bar Association and local law firms in Yangon.

Frank Poon, the solicitor general of Hong Kong’s Justice Department, said he believed the construction and property sector is the most likely area for Hong Kong’s arbitration system because of the nature of Myanmar’s economy.

“I believe the country … needs a lot of infrastructure and once you’ve got into a situation like that you have a lot of disputes with construction contracts,” he said.

“In the future we [hope to see] more and more Myanmar business companies come to Hong Kong for arbitration services.

“[But] Hong Kong is a little bit late in coming to Myanmar in relation to legal services … Not too many [Myanmar companies] have heard about Hong Kong arbitration.”

He said that Hong Kong’s arbitration system is also likely to see business from Hong Kong-based companies operating in Myanmar. Hong Kong is the third-largest source of foreign investment in Myanmar, after mainland China and Thailand, with its firms investing US$6.544 billion in 79 projects through the Myanmar Investment Commission since 1988.

A senior member of the Union of Myanmar Federation of Chambers of Commerce and Industry’s legal affairs team said he welcomed the visit of the Hong Kong delegation. He said he expected a “boom” in demand for arbitration forces as rule of law improves.

“Currently the role of arbitration is still almost absent but once the law is enforced, the arbitration services will boom,” said U Khun Win Hlaing, a patron of the UMFCCI legal affairs group. “We can learn from them and we are ready to support them to understand our rules and laws.”

Ruth Stackpool-Moore, the managing counsel of the Hong Kong International Arbitration Centre, said Hong Kong’s arbitration system differs from mainland China, where there is little legal independence.

“We have a different system from China,” Ms Stackpool-Moore said. “[I]n respect of disputes between mainland China and other countries, they can trust Hong Kong because we have our own court and we have our final court of appeal.”

Hong Kong’s current market share for arbitration services in Myanmar is still minimal, with Singaporean companies handling most arbitration cases in both Singapore and Myanmar. According to legal industry sources, such is the demand for their services that some Singaporean law firms have appointed Myanmar-speaking arbitrators.


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