Hong Kong Arbitration Awards enforcement in India
Hong Kong is a well-established financial center in the world and at the same time India is growing as a global economic power in recent years. Both Countries have their own demographics and economic structure but we will analyze their legal system with a legal luminary Mr. Vishal Pancholi a well known lawyer of India and residing in Hong Kong for more than 14 years. We interview him with regard enforcement of Hong Kong Arbitration awards in India. Here are the excerpts of interview with lawyer Mr. Vishal Pancholi
Q.1 How would you compare Hong Kong and Indian legal systems?
Ans: The Relationship of Hong Kong and India with regard to business arrangements from both sides are very long, Hong Kong Companies do business in India and vice versa. Hong Kong is Asia’s world city and door for business gateway to China and South East Asia Region. From the point of legal system both countries have developed their own procedures and practice as per their social, political and business environment and changes. India has been an arbitration friendly country right from the beginning, because arbitration was prevalent even before the codified law came into force. In the pre-court period the leaders of the communities and the elders of the families used to act as arbitrators and people used to obey the decision of those arbitrators.
Q.2. Is there any connection between two Jurisdictions with related to Arbitration Awards?
Ans: In a notification in the official gazette by the Indian government in 2012 and recognition of China and Hong Kong arbitration awards in Indian courts was taken as welcome move by both the Jurisdictions. Now the shipping disputes and trade related disputes between companies in India and Hong Kong are well within the jurisdictions of both the courts.
Q.3 Is Arbitration is the most appropriate and affordable way to adjudicate the matter or settle the dispute between two parties?
Ans: Arbitration is much faster way of out of court resolution of dispute between two parties decided by impartial third party. You don’t require any court room, jury and formal procedure to adjudicate the matter. Arbitration is cost effective way of resolution of matter out of court. The features like speedy process, cost effective way and privacy make its clearly beneficial for both the parties
Q.4. How Indian Courts can enforce the arbitration awards of Hong Kong in India?
Ans: In 2012, India confirmed that it will add the Peoples’ Republic of China (including the Special Administrative Regions of Hong Kong and Macao) to the list of socalled “gazetted” states. The approach of the Indian court to enforce the arbitration award is still in the process of evolvement. The Supreme Court (“SC”) judgment in Government of India v. Vedanta Limited and Others while noting that a foreign award does not become a “foreign decree” at any stage of the proceedings, the SC held that enforcement of a foreign award takes place only after the court is satisfied that it is enforceable under Part II of Chapter I of the Act. The foreign award has to pass the muster of Sections 47 and 49, after which the award becomes a ‘deemed decree’. Following the 2015 amendment to the Arbitration and Conciliation Act, the Indian courts have maintained their approach of minimal intervention in cases concerning the enforcement of foreign awards. The courts have stepped in to prevent enforcement only on limited grounds and in a few select cases. Even in such select cases, the threshold for convincing the court that an award should not be enforced is high. Therefore, it appears that enforcement is the norm and refusal is the exception. The idea of foreign arbitration award enforcement in India is getting rolled with lot of pace and Indian courts are finding a lot of applications for enforcement of Foreign Arbitration Awards in India
Q5. Finally, do both the Hong Kong and India moving closer for more dispute resolution methods in Commercial disputes?
Ans: Arbitration is the way forward step to move closer in the dispute resolution in both the jurisdictions. Indian government is opening the legal sector for the foreign law firms on the reciprocals basis and soon we will see more changes not only in both jurisdictions but legal sectors as a whole. I think India and Hong Kong has much wider scope to move closer in future with respect to future changes in laws in both the countries.
