On 11 March 2026, the Hong Kong Court of First Instance dismissed an application to set aside a partial arbitral award dated 24 September 2024 and a final award on costs dated 26 March 2025, rendered in the context of a dispute arising out of a cross-border share purchase transaction. In doing so, the Court reaffirmed Hong Kong’s pro-arbitration stance and the narrow scope of judicial review available under section 81 of the Arbitration Ordinance (Cap. 609), which incorporates Article 34 of the UNCITRAL Model Law.

On 12 December 2016, the applicants (“Sellers“) and the respondents (the “Buyers“) entered into a Share Purchase Agreement (“SPA“) for the sale of shares in a target company for a stated consideration of USD 110 million. Completion under the SPA was conditional upon the Buyers obtaining the requisite Overseas Direct Investment (“ODI“) approvals under PRC law and paying the USD sale price.

On the same date, the parties concluded a First Supplemental Agreement granting the Buyers exit and repurchase rights in the event that the target company’s contemplated IPO did not occur by 11 December 2019.

Anticipating that ODI approval might not be obtained within the contractual timeframe due to tightening PRC capital controls, the parties entered into a Second Supplemental Agreement on 28 December 2016. Pursuant to that agreement, the Buyers agreed to make an RMB-denominated domestic payment (the “Domestic Payment“) equivalent to the USD sale price, in exchange for which the Sellers transferred the shares to the Buyers prior to formal completion of the SPA. The Second Supplemental Agreement further provided that, if completion could not be achieved by 31 January 2020, the Buyers would be entitled to exit the transaction and recover a “Return Sum” consisting of the Domestic Payment plus a guaranteed annual return.

The Buyers ultimately failed to obtain ODI approval, the USD sale price was never remitted, and formal completion under the SPA never occurred. The IPO was abandoned in 2019. The Buyers thereafter exercised their contractual exit rights and sought repayment of the Domestic Payment together with the agreed returns. The Sellers disputed their entitlement, which prompted the Buyers to commence arbitration proceedings in March 2021.

The dispute was submitted to arbitration seated in Hong Kong. Following a hearing in August 2023, the arbitral tribunal rendered a Partial Award on 24 September 2024 and a Final Award on Costs on 26 March 2025, ruling in favour of the Buyers on four independent grounds: (i) the proper construction of clauses 4.01 and 4.02 of the First Supplemental Agreement; (ii) estoppel; (iii) the interpretation of clauses 2.03 and 2.04 of the Second Supplemental Agreement; and (iv) implied terms arising under clause 2.06(a) of the Second Supplemental Agreement. The tribunal held that, although formal completion under the SPA had never occurred, the Buyers had nonetheless provided the agreed investment financing through the Domestic Payment and were accordingly entitled to repayment together with the agreed returns.

The Sellers subsequently applied to the Court of First Instance to set aside the awards under section 81 of the Arbitration Ordinance. They advanced two principal arguments. First, they contended that the Buyers had, in their closing submissions, improperly departed from a position allegedly agreed between the parties during the arbitration, namely, that the Domestic Payment was not equivalent to the USD sale price and that formal completion had never taken place, by arguing that the Domestic Payment effectively constituted the investment amount. The Sellers submitted that the tribunal had accepted this new argument without granting them an adequate opportunity to respond, thereby depriving them of the opportunity to present their case. They further argued that the tribunal’s prior refusal to admit expert evidence on PRC law, to demonstrate that equating the Domestic Payment with the USD sale price contravened PRC foreign exchange and ODI regulations, had compounded this procedural unfairness.

Second, the Sellers argued that enforcement of the awards would violate Hong Kong public policy, on the basis that the underlying transaction constituted an unlawful foreign exchange arrangement contrary to PRC law.

The Buyers denied any departure from their pleaded case, maintaining that their position had been consistent throughout the proceedings and that the Domestic Payment had always been characterised as the agreed investment financing. They further contended that the tribunal’s refusal to admit PRC law expert evidence was a legitimate case-management decision within its procedural discretion.

The legal questions raised before the Court were:

• whether the Sellers had been “unable to present their case” within the meaning of Article 34(2)(a)(ii) of the UNCITRAL Model Law by reason of the tribunal’s alleged reliance on an unexpected factual and legal basis;
• whether the tribunal’s refusal to admit PRC law expert evidence amounted to a serious breach of due process; and
• whether the awards conflicted with Hong Kong public policy within the meaning of Article 34(2)(b)(ii) of the UNCITRAL Model Law on the grounds that the underlying transaction allegedly contravened PRC foreign exchange and ODI regulations.

The Court dismissed the application in its entirety, reaffirming the narrow scope of judicial review over arbitral awards under Hong Kong law.

Firstly, the Judge rejected the Sellers’ argument that they had been deprived of the opportunity to present their case. The Court found that the Buyers had consistently pleaded, throughout the arbitration, that the Domestic Payment constituted the economic substance of the agreed investment financing and that formal completion under the SPA was not a prerequisite for the Buyers’ repurchase rights to arise. The tribunal had therefore not relied on any new or unexpected basis, but had simply accepted one party’s interpretation of the contractual framework. The Court emphasised that supervisory courts are not entitled to “comb an award to look for errors” or to revisit the correctness of a tribunal’s substantive findings.

Secondly, the Court held that the tribunal’s refusal to admit PRC law expert evidence constituted a procedural case-management decision that was entitled to considerable judicial deference. The tribunal had concluded that the dispute did not involve any cross-border payment or USD remittance and that the PRC regulations relied upon by the Sellers were therefore not material to the determination of the issues in dispute. The Court held that such decisions could not justify annulment absent a serious denial of justice causing actual prejudice. Moreover, the Court observed that, even assuming some procedural irregularity, the outcome of the arbitration would have remained unchanged in any event, given that the tribunal had upheld the Buyers’ claims on several independent grounds — including estoppel and implied contractual terms — which were unconnected to the alleged PRC illegality. The Sellers accordingly failed to establish actual prejudice.

Finally, the Court dismissed the public policy challenge. Justice Chan reiterated that “public policy” within the meaning of Article 34(2)(b)(ii) refers exclusively to the public policy of Hong Kong, and not that of Mainland China. The Court held that the tribunal had already determined that no PRC regulations had been contravened, and that the Hong Kong courts could not revisit that determination. Furthermore, the Court held that, even if difficulties in enforcing the awards in Mainland China were to arise, such circumstances would not render the awards contrary to Hong Kong public policy. Public policy, the Court stressed, must be narrowly construed, and enforcement would only be refused where it would offend the “most basic notions of morality and justice” in Hong Kong.

The application was accordingly dismissed, and indemnity costs were awarded against the Sellers.

This decision constitutes a strong reaffirmation of Hong Kong’s pro-arbitration and pro-enforcement stance. The judgment illustrates the courts’ consistent reluctance to interfere with arbitral awards, particularly when applicants seek to re-characterise disagreements on the merits as procedural irregularities or public policy violations.

The case is also of broader significance in the context of disputes involving alleged PRC regulatory illegality. The Court drew a clear distinction between incompatibility with Mainland Chinese regulations and genuine violations of Hong Kong international public policy, thereby reinforcing the autonomy of Hong Kong’s arbitral framework and the finality of arbitral awards rendered in Hong Kong-seated proceedings. The judgment serves as a useful reminder that the public policy ground for annulment remains an exceptional remedy of last resort, not a vehicle for re-litigation of the merits.

This article was originally published in the PBA Bulletin on June 5, 2026 with thanks to Paris Baby Arbitration, Jus Mundi & Jus Connect.

read it Here

ABOUT THE AUTHOR

Jihane Bensaid is a candidate in the LL.M./MSc in International Business Law and Management (“DAIM”) at ESSEC Business School and previously completed a Master’s degree in Business Law at Paris 1 Panthéon-Sorbonne in partnership with the Euro-Mediterranean University of Fez. She currently works in the legal and finance department of Groupe Ricardo, where she assists with cross-border corporate and restructuring matters. Jihane is a member of the ESSEC Willem C. Vis International Commercial Arbitration Moot team and a contributor to the Paris Baby Arbitration newsletter. Her interests focus on international arbitration and cross-border restructuring, particularly in transactions involving Europe, Africa, and Asia.

*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.

Tous les griefs procéduraux ne justifient pas une annulation : la Cour de Hong Kong réaffirme son approche favorable à l’arbitrage

Hong Kong Court of First Instance, AT & another v QC & another [2026] HKCFI 1437

Le 11 mars 2026, la Cour de première instance de Hong Kong a rejeté une demande d’annulation de deux sentences arbitrales issues d’un litige portant sur une cession transfrontalière de parts sociales. La Cour a confirmé que le contrôle judiciaire des sentences arbitrales est limité, conformément à l’article 81 de l’Arbitration Ordinance (Cap. 609) et à l’article 34 de la Loi type de la CNUDCI.

Le 12 décembre 2016, les requérants (les « Vendeurs ») et les défendeurs (les « Acquéreurs ») ont conclu un contrat de cession de parts sociales (le « Contrat ») pour un prix de 110 millions de dollars américains. La réalisation du Contrat était conditionnée à l’obtention par les Acquéreurs des autorisations d’investissement direct à l’étranger (« ODI ») requises en droit chinois.

Face au durcissement des contrôles ODI en Chine continentale, les parties ont conclu le 28 décembre 2016 un accord complémentaire prévoyant que les Acquéreurs verseraient immédiatement un paiement en renminbi équivalent au prix de vente (le « Paiement domestique »), en échange de quoi les Vendeurs transféraient les titres sans attendre la réalisation formelle du Contrat. Si celle-ci n’intervenait pas avant le 31 janvier 2020, les Acquéreurs pourraient sortir de l’opération et récupérer leur mise, augmentée d’un rendement annuel garanti.

Les autorisations ODI n’ont jamais été obtenues et la réalisation formelle du Contrat n’a pas eu lieu. L’introduction en bourse prévue a également été abandonnée en 2019. Les Acquéreurs ont alors exercé leur droit de sortie et réclamé le remboursement du Paiement domestique assorti des rendements convenus. Face au refus des Vendeurs, ils ont engagé une procédure arbitrale en mars 2021.

L’arbitrage s’est tenu à Hong Kong. Après une audience en août 2023, le tribunal arbitral a donné raison aux Acquéreurs dans une sentence partielle du 24 septembre 2024, confirmée par une sentence finale relative aux frais du 26 mars 2025. Il a jugé que, même sans réalisation formelle, les Acquéreurs avaient bien fourni le financement prévu et étaient fondés à en réclamer le remboursement.

Les Vendeurs ont demandé l’annulation des sentences devant la Cour de première instance, en soulevant deux moyens. D’une part, ils ont soutenu que les Acquéreurs avaient modifié leur position en cours de procédure en présentant, dans leurs conclusions finales, un argument nouveau auquel ils n’avaient pas pu répondre, violant ainsi leur droit d’être entendus. Ils ont également reproché au tribunal d’avoir refusé d’admettre une expertise en droit chinois destinée à démontrer l’illicéité de l’opération. D’autre part, ils ont soutenu que l’exécution des sentences serait contraire à l’ordre public de Hong Kong.

Les Acquéreurs ont nié tout changement de position et ont fait valoir que le refus d’admettre l’expertise relevait du pouvoir discrétionnaire du tribunal en matière de gestion de la procédure.

La Cour devait déterminer :

• si les Vendeurs avaient été privés de leur droit d’être entendus au sens de l’article 34(2)(a)(ii) de la Loi type de la CNUDCI ;
• si le refus d’admettre l’expertise constituait une violation grave du contradictoire ; et
• si les sentences étaient contraires à l’ordre public de Hong Kong au sens de l’article 34(2)(b)(ii) de la Loi type de la CNUDCI.

La Cour a rejeté l’ensemble des moyens.

Sur le premier moyen, le juge a relevé que les Acquéreurs avaient, dès le début de la procédure, qualifié le Paiement domestique de financement de l’investissement. Il n’y avait donc pas eu de changement de position, et le tribunal s’était borné à accueillir l’interprétation contractuelle d’une des parties. La Cour a rappelé qu’il n’appartient pas aux juridictions de contrôle de rejuger les sentences arbitrales sur le fond.

Sur le deuxième moyen, la Cour a jugé que le refus d’admettre l’expertise en droit chinois constituait une décision de gestion procédurale relevant du pouvoir discrétionnaire du tribunal, qui n’avait estimé le droit chinois pertinent pour aucune des questions à trancher. En tout état de cause, même si une irrégularité avait été commise, l’issue de l’arbitrage aurait été la même, le tribunal ayant statué en faveur des Acquéreurs sur plusieurs fondements indépendants. Les Vendeurs n’ont donc pas établi l’existence d’un préjudice effectif.

Sur le troisième moyen, la Cour a rappelé que l’ordre public visé à l’article 34(2)(b)(ii) est exclusivement celui de Hong Kong, et non celui de la Chine continentale. Le tribunal ayant déjà constaté qu’aucune réglementation chinoise n’avait été violée, les juridictions hongkongaises ne pouvaient remettre cette appréciation en cause. L’annulation ne pouvait être prononcée qu’en cas d’atteinte aux principes les plus fondamentaux de la justice à Hong Kong, ce qui n’était pas établi en l’espèce.

Les Vendeurs ont été condamnés aux dépens sur la base de l’indemnité intégrale.

Cette décision illustre l’approche restrictive des juridictions hongkongaises en matière de contrôle des sentences arbitrales. Elle confirme que les moyens fondés sur le défaut de contradiction ou la violation de l’ordre public sont interprétés strictement, et ne permettent pas de remettre en cause le fond d’une sentence.

Elle apporte également un éclairage utile sur la distinction entre l’ordre public de Hong Kong et les règles impératives du droit chinois, rappelant que la seule incompatibilité d’une opération avec la réglementation de la Chine continentale ne suffit pas à fonder une annulation à Hong Kong.

Cet article a été initialement publié dans le bulletin PBA le vendredi 5 juin, 2026, avec le soutien de Paris Baby Arbitration, Jus Mundi & Jus Connect.

lire Ici

ABOUT THE AUTHOR

Jihane Bensaid is a candidate in the LL.M./MSc in International Business Law and Management (“DAIM”) at ESSEC Business School and previously completed a Master’s degree in Business Law at Paris 1 Panthéon-Sorbonne in partnership with the Euro-Mediterranean University of Fez. She currently works in the legal and finance department of Groupe Ricardo, where she assists with cross-border corporate and restructuring matters. Jihane is a member of the ESSEC Willem C. Vis International Commercial Arbitration Moot team and a contributor to the Paris Baby Arbitration newsletter. Her interests focus on international arbitration and cross-border restructuring, particularly in transactions involving Europe, Africa, and Asia.

*Les points de vue et les opinions exprimés par les auteurs sont les leurs et ne reflètent pas nécessairement ceux de leurs organisations, de leurs employeurs ou de Daily Jus, Jus Mundi ou Jus Connect.