Hong Kong

Hong Kong's Law Reform Commission, the statutory group responsible for revising Hong Kong legislation, called for the introduction of class action suits in a detailed report issued in May 2012. The proposal suggests that class actions initially be permitted for smaller civil cases in front of the High Court, before being expanded to all civil cases and to matters against the government. The proposal followed a public consultation period in 2009-2010 during which several corporate law firms and business organizations supported the proposed scheme, although other business interests opposed or had reservations about the proposal. As of 2014, the Hong Kong Department of Justice has yet to begin the drafting process for a new law. If enacted, this class action system could lead to greater litigation in Hong Kong.

Separately, the Hong Kong Law Reform Commission created a committee in 2013 to review Hong Kong's policy on third party funding (TPF). In January 2016, ILR submitted comments on the Commission's proposal to authorize the use of TPF to finance the conduct of arbitration matters in the jurisdiction. While the review appears to be focused on methods of financing commercial arbitration and insolvency cases, we are concerned that a relaxation of legal financing rules could lead to the use of TPLF in other areas, including class actions if they are introduced in the territory.