First Hong Kong case to consider restraining offshore winding up proceedings in favour of Hong Kong arbitration following the Re Guy Lam and Sian Participation saga (Hyalroute v ICBC)
Arbitration analysis: In this case, the Hong Kong Court dismissed an anti-suit injunction application seeking to restrain winding-up proceedings in the Cayman Islands, holding that such proceedings did not breach the arbitration clause in the parties’ agreement. The court found that the Cayman petition did not ‘finally resolve’ the dispute and thus fell outside the scope of the arbitration agreement. This decision sidesteps the divergent approaches in Re Guy Lam and Sian Participation, but underscores that the enforceability of arbitration clauses against foreign insolvency actions depends on precise drafting. Practitioners should note the court’s emphasis on the governing law of the foreign proceedings and the interpretation of ‘finally resolved’ as expressed in arbitration clauses. Hong Kong courts should be slow to interfere with the debtor’s home jurisdiction unless a clear breach of an arbitration agreement is shown. The case is a key reference for cross-border insolvency and arbitration practitioners navigating anti-suit relief in common law jurisdictions. Written by Wesley Pang, partner and Head of International Arbitration, Asia, and Aaron Yam, associate, Litigation and Dispute Management, Hong Kong, at Eversheds Sutherland (The authors thank Yuxaun Huang and Karin Yuen for their assistance in preparing this commentary).