Russian companies turn to Hong Kong courts amid sanctions and legal concerns
Russian companies are increasingly turning to Hong Kong for dispute arbitration services and adopting Hong Kong’s governing law in commercial contracts, writes Nikkei in its latest report.
This shift is due to sanctions imposed on Russia over the Ukraine war, limiting access to Western courts, including London’s common law legal system that Russian companies traditionally favored.
Hong Kong’s sanctions-neutral policy, common law system, and judiciary independence have become attractive to Russian businesses, leading to a spike in arbitration cases.
The city’s relationship with Russia has been strengthened, with trade between China and Russia also growing.
While Hong Kong has positioned itself as an alternative legal hub, there are concerns about the city’s judicial independence.
Some Western and Japanese companies have moved their disputes to Singapore following the enactment of Hong Kong’s national security law in 2020.
Additionally, new Russian legislation and court decisions could deter Russian companies from seeking legal services in Hong Kong.
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