Professor Teresa Cheng SC, Dr. Colin Ong, Mr. Justin D’Agostino,
Mr. Paul Starr, Distinguished Guests, Ladies and Gentlemen,
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On behalf of the Department of Justice, may I extend our
warmest welcome to all of you here, especially to our guests
who travelled from overseas jurisdictions to attend this
Summit.
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The theme for this breakout session is “Using Hong Kong as
a Platform for Infrastructure Dispute Resolution”. On my
part, I have absolutely no doubt that this theme is a
well-chosen one. My reason is two-fold.
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The first is the important role played by infrastructure
projects in the Belt and Road context. You would appreciate
that the key objective of the Belt and Road Initiative is to
improve economic connections, and that one of the key areas
of co-operation envisaged under the Initiative is “facilities
connectivity”, which primarily focuses on the improvement
of the connectivity of infrastructure construction and the
formation of an infrastructure network connecting all
sub-regions in Asia, and between Asia, Europe and Africa.
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I believe the importance of, as well as the need for,
infrastructure projects do not require detailed elaboration. A
few figures will give an overall view of the big picture. A
report issued by the Asian Development Bank earlier this
year estimated that Asia infrastructure investment, over a
15-year period (from 2016 to 2030), would amount to US$26
trillion, equaling US$1.7 trillion per year1
. In the specific context of the Belt and Road Initiative, it has been reported
that China has invested more than US$50 billion in Belt and
Road economies since 20132. These figures, apart from being
astronomical, illustrate the scale of projects that we are
dealing with.
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Such an upsurge in the need for and investment in
infrastructure raises the question of professional management,
including the need for proper legal risk management. Such
legal risk management covers every step in the process,
including the need for legal due diligence before
commencement of infrastructure projects, the negotiation and
drafting of the relevant infrastructure contract(s) and possibly
incidental financing contracts, the choice of law clause, the
design and drafting of dispute avoidance provisions, as well
as dispute resolution clause (be it mediation, arbitration,
adjudication, expert determination or otherwise).
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Since the Belt and Road routes cover more than 60
jurisdictions, and given the fact that they have different legal
systems as well as diverse legal cultures and legal tradition,
the need for effective legal risk management is all the more
indispensable. Besides, although we all would like to see that
infrastructure projects proceed smoothly and successfully
among the Belt and Road jurisdictions, disputes in one form
or another are inevitable even if each party conduct
themselves in a bona fide manner. Accordingly, robust
dispute resolution mechanisms, supported by top-quality
professionals, are essential, so that disputes can be resolved
in a fair, expeditious and cost-effective manner.
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This brings me to the second part of the reason as to why the
theme of this session is well-chosen: Hong Kong, being an
important centre for international legal and dispute resolution
services in the Asia-Pacific region, is an ideal platform for
resolving infrastructure disputes in the Belt and Road
context.
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Hong Kong has a long history in promoting dispute
resolution, especially construction arbitration and
international commercial arbitration. Since around the 1980s,
if not earlier, arbitration was used by the construction
industry and the commercial community to resolve disputes
in Hong Kong. Indeed, the fact that Hong Kong has been
continually having significant construction projects
(including some mega projects such as the construction of
the airport) has nurtured an extensive pool of experts who are
experienced in handling infrastructure disputes.
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Needless to say, the home-grown Hong Kong International
Arbitration Centre, together with other relevant stakeholders
and institutions, have also played a crucial role in providing
the necessary service and expertise for resolving
infrastructure disputes.
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The Hong Kong Government, on the other hand, has all
along recognized the importance of promoting arbitration and
other means of dispute resolution, and has been giving such
support as may be appropriate. Among others, the
Department of Justice has been constantly modernizing and
updating our dispute resolution-related legislation, including
the Arbitration Ordinance and the Mediation Ordinance, to
ensure that our legislative regimes meet the need of the
end-users and is in alignment with international best practice.
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I have alluded to the diversities among the Belt and Road
jurisdictions. Such diversities call for an independent and
neutral forum that can command the confidence and trust of
the parties and the international arbitration community. In
this regard, apart from the well-known quality and
independence of our Judiciary as well as its pro-arbitration
approach, it is pertinent to note the following observation
made by a judge of the High Court of England and Wales3:
“… … whilst Hong Kong is no doubt geographically
convenient, it is also a well-known and respected arbitration
forum with a reputation for neutrality, not least because of its
supervising courts”.
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Arbitration is meaningless unless we can enforce its
end-product --- the arbitral award. This is why enforceability
of arbitral award has been regarded as one of the most
important factors when parties decide where to arbitrate. This
is also one of the reasons why Hong Kong is an ideal
arbitration venue, since arbitral awards made in Hong Kong
can be enforced in over 150 jurisdictions pursuant to the New
York Convention and also reciprocal arrangements made
with the Mainland and the Macao SAR.
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On the whole, Hong Kong can play a unique role in the
resolution of infrastructure disputes in the Belt and Road
context. Whilst being part of China, Hong Kong remains a
neutral common law jurisdiction pursuant to the ‘one country,
two systems’ policy with decades of experience in handling
infrastructure disputes, as well as backed up by an array of
other supporting professional services (such as quantity
surveying, accounting and project management consultants).
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We of course appreciate that the Belt and Road Initiative is a
huge project, and that is successful implementation requires
co-operation and collaboration among the jurisdictions along
the Belt and Road route. Hong Kong is more than ready and
willing to work with other jurisdictions to explore how
different dispute resolution mechanism can be further
enhanced so as to better facilitate the implementation of the
Belt and Road Initiative.
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Today, we are privileged to have 4 very distinguished dispute
resolution experts. We are grateful to Professor Teresa Cheng
SC for agreeing to be the moderator, a role that looks easy
but in fact never simple. Professor Cheng herself is a
well-known figure in the international arbitration community
and also has a strong background in construction. We will
then have Dr. Colin Ong, QC, who will be speaking on the
future landscape of dispute resolution in Asia. With the Belt
and Road Initiative being implemented in full force, there
have been much discussions and queries as to how the
Initiative would impact upon the dispute resolution landscape.
I am sure Dr. Ong QC will guide us to understand more
about our future.
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We are also very lucky to have Mr. Justin D’Agostino, an
active player in the international arbitration community, to
talk to us on disputes avoidance and project managements.
Dispute resolution should not be confined to mechanisms for
resolving disputes after they have arisen. Avoiding disputes
in the first place is equally important, and we look forward to
hearing Mr. D’Agostino’s speech. Last but certainly not least,
we will have Mr. Paul Starr, yet another well-known figure in
the field, to address us on the new frontiers in dispute
settlement for infrastructure investments in Asia. I am sure
we will all benefit from the insights of these leading
speakers.
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On this note, may I wish all of you an enjoyable and fruitful
session.
Thank you.