HK foreign disputes bow to central authority
Source: Agencies |
August 27, 2011, Saturday
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Print Edition
Print Edition
CHINA'S top legislature ruled yesterday that sovereign states have immunity from prosecution in Hong Kong courts from paying debts in a commercial case.
The Standing Committee of the National People's Congress unanimously ruled that "state immunity" also applies in Hong Kong for a commercial case seeking to recover more than US$100 million from the Democratic Republic of Congo.
The NPC ruling said Hong Kong's laws concerning rules on state immunity must "be consistent with the rules or policies on state immunity that the central government has adopted."
Under Chinese law, nation states enjoy "absolute immunity" in cases including commercial transactions.
The case centered around attempts by foreign investors to recover debts owed by Congo for a string of energy projects that were built by a Yugoslav engineering firm in the 1980s.
Hong Kong's top court this year rejected a bid by a vulture fund to sue the African country in pursuit of at least US$126 million in debts.
But the court referred the decision to the NPC Standing Committee for an interpretation of Hong Kong's Basic Law.
Hong Kong is a special administrative region of China with its own legal and financial system and a high degree of autonomy.
The Basic Law says Hong Kong "shall have no jurisdiction over acts of state such as defense and foreign affairs," which lie instead with the central government.
Before Hong Kong's 1997 handover, commercial cases involving sovereign states had been permissible, but lawmakers shrugged off any business impact from the ruling.
"Hong Kong is a part of China," Rita Fan, a member of the NPC Standing Committee said after the decision. "The Basic Law is very clear that foreign affairs or defence are the responsibility of China."
The Standing Committee of the National People's Congress unanimously ruled that "state immunity" also applies in Hong Kong for a commercial case seeking to recover more than US$100 million from the Democratic Republic of Congo.
The NPC ruling said Hong Kong's laws concerning rules on state immunity must "be consistent with the rules or policies on state immunity that the central government has adopted."
Under Chinese law, nation states enjoy "absolute immunity" in cases including commercial transactions.
The case centered around attempts by foreign investors to recover debts owed by Congo for a string of energy projects that were built by a Yugoslav engineering firm in the 1980s.
Hong Kong's top court this year rejected a bid by a vulture fund to sue the African country in pursuit of at least US$126 million in debts.
But the court referred the decision to the NPC Standing Committee for an interpretation of Hong Kong's Basic Law.
Hong Kong is a special administrative region of China with its own legal and financial system and a high degree of autonomy.
The Basic Law says Hong Kong "shall have no jurisdiction over acts of state such as defense and foreign affairs," which lie instead with the central government.
Before Hong Kong's 1997 handover, commercial cases involving sovereign states had been permissible, but lawmakers shrugged off any business impact from the ruling.
"Hong Kong is a part of China," Rita Fan, a member of the NPC Standing Committee said after the decision. "The Basic Law is very clear that foreign affairs or defence are the responsibility of China."
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