First successful property preservation at the Beijing Financial Court in aid of Hong Kong arbitration

Recently, DLA Piper and Shanghai Law Firm, Kaiman, successfully assisted a client in applying for property preservation before the Beijing Financial Court in aid of an arbitration administered by the Hong Kong International Arbitration Centre (HKIAC).

According to the report issued by the Beijing Financial Court, this is the first property preservation case they have handled in accordance with the Arrangement of the Supreme People's Court Concerning Mutual Assistance in Court-ordered Interim Measures in Aid of Arbitral Proceedings by the Courts of the Mainland and of the Hong Kong Special Administrative Region since the establishment of the court. In this case, DLA Piper coordinated with HKIAC in the transfer of the application for asset preservation and completed in conjunction with Kaiman the entire process from the filing of the application to the seizure of the property. The property of the debtor in Beijing was successfully preserved. This case fully demonstrated DLA Piper’s capability in providing comprehensive legal services in resolving cross-border financial disputes.

As this is the first application for interim measures in aid of Hong Kong arbitral proceedings processed by the Beijing Financial Court, the court made detailed enquiries about the parties to the dispute, the content of the dispute, the necessity of preservation and jurisdictional issues. Drawing on our extensive experience in handling applications for interim measures in aid of arbitral proceedings in Hong Kong and our in-depth knowledge of the facts of the case, DLA Piper and Kaiman assisted the client in responding to each of the questions raised by the court which, in turn, convinced the court to issue a decision and preserve the relevant property in a speedy manner. Working hand in hand, DLA Piper and Kaiman have overcome challenges posed by COVID-19 at each stage of the application, and eventually protected the legitimate rights and interests of the client.

The underlying HKIAC arbitration concerns disputes arising from the de-SPAC of a NASDAQ listed company. The case involved multiple cross-border issues and presented a high degree of complexity, spanning multiple jurisdictions such as China, USA, Cayman Islands, and the British Virgin Islands, and involved arbitration proceedings in Hong Kong and property preservation process in Mainland China. Leveraging its global legal service network and the local strength of Kaiman, DLA Piper secured the first success in asset preservation at the Beijing Financial Court in aid of cross-order arbitrations.

Ernest Yang, Co-Head of International Arbitration, Asia Pacific – Hong Kong commented:

“Our cross-border team continues to deliver outstanding and efficient results for our clients in complex international disputes in Greater China. I am deeply honored to assist our clients and I take great pride in our excellent team.”

Xiaoshan Chen, Head of International Arbitration – China commented:

“Property preservation is of indisputable importance in dispute resolution. This case not only demonstrated HKIAC’s profound experience in assisting parties to the dispute to apply for property preservation with Mainland Courts in accordance with the Arrangement Concerning Mutual Assistance in Court-Ordered Interim Measures in Aid of Arbitral Proceedings by the Courts of the Mainland and the Hong Kong Special Administrative Region, but also displays DLA Piper’s expertise in resolving cross-border disputes by leveraging all available remedies to protect the interests of our clients.”

Lillian Duan, Managing Partner of Shanghai Kaiman Law Firm added:

“This is a strong demonstration of how we are able to leverage capabilities at both Kaiman and DLA Piper to assist clients across multiple jurisdictions a seamless manner. Since signing the cooperation agreement, both firms have been working closely together to meet their client needs, with more collaboration anticipated in the future through this cooperation.”