Worldwide: Litigation v Arbitration: Where Are We Now?

Cross-border litigation has seen a boost with the ratification of the Hague Convention on Choice of Court Agreements ("Hague Convention") by Singapore in June this year, following the establishment of the Singapore International Commercial Court ("SICC") in 2015. In arbitration, we have seen a number of pro-arbitration decisions around the world this year (please see our October 2016 Japan Dispute Avoidance newsletter). Additionally, Hong Kong has recently published a proposed amendment to its arbitration ordinance, clarifying that IP disputes are arbitrable and enforcement of IP-related awards do not breach public policy.

Hague Convention

The Hague Convention entered into force on 1 October 2015, following the ratification by Mexico and 27 European Union member states (excluding Denmark). The aim of the Hague Convention is to increase the effectiveness of jurisdiction or choice of court agreements in contracts and to facilitate the enforcement of foreign judgments, much like the purpose of the New York Convention in the recognition and enforcement of arbitration agreements and arbitral awards.

With the ratification by Singapore, there is growing momentum for further state parties ratifying the Hague Convention. For example, in October 2016, the Department of Justice in Hong Kong released a Consultation Paper on the 2016 Preliminary Draft Convention on the Recognition and Enforcement of Foreign Judgments (the "Draft Convention"). The Draft Convention is part of the Hague Conference's work on private international law, and will supplement the Hague Convention by increasing access to justice and to facilitate cross-border trade and investment through reducing risks and costs of cross-border trade, and to increase certainty and predictability for stakeholders. For further details, please see our October Hong Kong Dispute Resolution e-bulletin.

International Courts

Last year, the two main International Courts, the Courts of the Dubai International Finance Centre ("DIFC") and the SICC signed two memoranda of guidance and understanding, paving the way for mutual recognition and enforcement within the two jurisdictions.

The DIFC have also recently entered into agreements with various countries, including the United Kingdom, United States, Australia, New Zealand and Kenya, facilitating the mutual enforcement of judgments. The DIFC also recently signed a Memorandum of Understanding with the Dubai International Arbitration Centre ("DIAC"), to facilitate the expedited recognition, ratification and enforcement of DIAC arbitral awards by the DIFC Courts.

In relation to Singapore, the island state is a party to several treaties for mutual recognition and enforcement (such as with India), and in any event judgments are enforceable in Commonwealth countries, such as the UK, Australia, New Zealand and Canada.

IP disputes arbitrable in Hong Kong

Hong Kong has published a bill proposing an amendment to its arbitration ordinance, to clarify that IP disputes are arbitrable, and enforcement of IP-related awards do not breach public policy. In November, the Hong Kong Department of Justice had noted that the arbitration ordinance lacks an express provision dealing with the arbitrability of IP disputes, and Hong Kong courts have not delivered an authoritative judgment on the issue. This amendment follows the launch of the Hong Kong International Arbitration Centre's new Panel of Arbitrators for Intellectual Property Disputes earlier this year.

Costs awards in arbitration

There have been recent developments in relation to costs awards in arbitration, which increases the attractiveness of arbitration as a method of dispute resolution. A recent decision in England refused a challenge to an arbitral award that allowed recovery of costs of third party funding, while the Hong Kong Court of First Instance extended indemnity costs to actions that delay enforcement of arbitral awards.

In England, an award was challenged on the basis that the sole arbitrator's powers did not include awarding costs of third party funding.1 In coming to its decision, the court held that the "other costs" specified in s59(1)(c) of the English Arbitration Act "can include the costs of obtaining litigation funding", and that awarding the costs of litigation funding falls within the arbitrator's general cost discretion.

In Hong Kong, indemnity costs were awarded after a court held that reviving court proceedings, which were stayed in favour of arbitration, was "clearly an attempt to delay the enforcement of an arbitral award".2 In this case, an arbitral award had been rendered in favour of the claimant. The respondent then suggested the matter should be dealt with by the Hong Kong court proceedings that had been stayed. The claimant therefore restored the Hong Kong court proceedings, and the respondent employed various delaying tactics, including not filing evidence or filing late evidence, and applying to consolidate various proceedings, which ultimately failed. The Court of First Instance held that the respondent's actions were simply to delay enforcement of an arbitral award, despite not being proceedings to challenge an award, and awarded indemnity costs to deter such behaviour.

Litigation or Arbitration

With these positive developments in both cross-border litigation and arbitration, the question remains - which is more effective? It will depend on the nature of each transaction, the parties, and the dispute resolution mechanism available in the jurisdictions of the parties, as well as any confidentiality concerns, and most importantly the enforceability of any award or judgment. If parties are leaning towards arbitration, it is important to select a seat with a modern arbitration law, which allows parties to be represented by lawyers of their choice, as well as a jurisdiction that readily recognises and enforces arbitration agreements and awards. If such a seat is not available to parties, litigation may be the better choice.


1. Essar Oilfields Services Limited v Norscot Rig Management PVT Limited [2016] EWHC 2361 (Comm), for further details, please see our Arbitration Notes blog post here.

2. Peter Cheung & Co v. Perfect Direct Limited & Yu Guolin (HCMP 2493/2012) and New Heaven Investments Limited & Rondo Development Limited v. Yu Guolin (HCA 115/2013), for further details, please see our Arbitration Notes blog post here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Practice Guides
by Mondaq Advice Centres
Relevancy Powered by MondaqAI
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions