Financing arbitration in mainland China: Hong Kong's legislation as a model

摘要

Hong Kong has enacted a bill to amend its Arbitration Ordinance, in order to formalize financing arbitration and to make it clear that third-party funding (TPF) for arbitration is not prohibited by the common law doctrines of maintenance and champerty. While Hong Kong takes a courageous step on legislative reform, arbitration industry in mainland China is also flourishing and presents a rapid growth trend. By examining the legislative processes held by Hong Kong as a legal-financial model as well as employing a law-economic research methodology, it can be proved that TPF will enable the parties in dispute with easier access to justice, promote the quality of arbitral awards, as well as increase the welfare of the whole society. Therefore, it is justifiable to introduce TPF into arbitration seated in mainland China. Simultaneously, arbitration professionals should consider establishing a self-discipline mechanism to regulate TPF to maintain the legality of arbitral proceedings involving TPF.