Hong Kong Law Journal 1971 - 2024

The concept of partial rescission is a controversial one. It has generated intense academic debate and at the same time experienced diverse judicial reception - it was well received in Australia and New Zealand but considered to be inconsistent with the law of rescission under both English and Hong Kong law. This article explores some of the important and controversial aspects of this doctrine, including its relationship with rescission on terms, its role in restoring benefits in three-party situations, the limits of this remedy, and the conceptual basis of the doctrine. This article seeks to argue that, far from being inconsistent with English and Hong Kong law, the foundation of partial rescission can be traced back to developments in some rescission cases in England. Thus it can be viewed as a further development in the law of rescission rather than an incongruous outgrowth.

Commercial sale of goods transactions are remarkably diverse, ranging from the sale of precision, manufactured goods, where negotiations and post-delivery trials may be complex, to the sale of commodities such as grain and oil, which take place in impersonal and expedited circumstances. The market background may be stable, as in the former case, or highly volatile, as in the latter case. This article concentrates on the differences between these two types of sale and assesses the suitability of two instruments for dealing with them. One instrument is the United Nations Convention on the International Sale of Goods 1980, which has been widely adopted by nations all round the world. The other is the United Kingdom Sale of Goods Act 1979, which is replicated in substance in the Hong Kong Sale of Goods Ordinance (Cap 26). English law plays a dominant role as the law applicable to commodity sales whose performance is in no way connected to England. Commodity traders have resisted the application of the United Nations Convention. Comparing the merits and limitations of the two instruments, the article concludes that the United Nations Convention may be better suited for the sale of manufactured goods and the Sale of Goods Act (with a well-established case law) for commodity sales.

In Hong Kong and Australia, Courts of Appeal possess a discretionary power to order either a retrial or an acquittal where the Court is satisfied that a miscarriage of justice occurred at the trial. This power involves important public policy considerations in the administration of criminal justice. The relevant legislation in both jurisdictions is expressed in similar terms, although no statutory guidance is provided as to how the power should be exercised. This article examines how the Courts of Appeal in both countries exercise this discretion. The fundamental consideration is whether there is sufficiently cogent evidence to justify convicting the appellant. If there is not, then the appropriate order is an acquittal. If there is sufficient evidence to convict, then a retrial will be ordered unless it would be “unjust” to the appellant. The article discusses the recent decision of R v Thomas (No 3) which has considerably extended the circumstances where a retrial can be ordered.

This article explores what the author believes to be the fruitful task of comparing the divergent development of criminal due process jurisprudence in Hong Kong following the enactment of the Bill of Rights Ordinance and the Basic Law, with that in Singapore. Whilst Singapore cases have remained conservative, Hong Kong courts have begun to develop what promises to be a robust attitude toward due process issues. It is argued that the comparison between the two jurisdictions is especially apt given the many similarities between the peoples of Hong Kong and Singapore. The article also ventures to sketch out the predictive exercise of asking whether Singapore is likely to become more like Hong Kong, or whether it is Hong Kong which will move closer to Singapore.

The purpose of this article is to examine the principal laws that have a significant impact in shaping the meaning of the home in Singapore. This article makes two contributions to the pre-existing literature. First, the significant case law and statutes in Singapore affecting the concept of the home are collated and discussed. Second, in discussing these laws as a coherent whole, this article attempts to draw together the meaning of the home in the Singaporean context. The relevant laws are examined to determine whether the Western conception of “the home as a person's castle” is present in Singaporean law. It will be demonstrated that due to the unique laws in Singapore, the Singaporean home has a different legal conception from its English and American counterparts. Ultimately, the theme that emerges from the multitude of laws, regulations and government policies affecting the home is that the legal image of the Singaporean home is rooted in communitarianism, pragmatism and a series of state-imposed ideologies. With regard to the latter theme, these ideologies can be grouped into the following four broad clusters: (a) the ideology of stake holding in the country; (b) the ideology of the family; (c) the ideology of multi-culturalism; and (d) the ideology of politics.

Tax avoidance activity, like tax evasion, is neither unique to any one country nor a purely modern problem. It has been around, in varying degrees, wherever taxes have been levied. Many argue, however, that the scale of tax avoidance activity has grown significantly in more recent decades. This article explores the argument that some of the major common law jurisdictions face a greater threat than ever before, and that the integrity of the tax bases in those countries is being steadily eroded by sustained avoidance activity. The view is taken - hardly contentious - that there has been a growth in avoidance activity in recent decades. The article then considers some of the legislative, judicial and administrative responses to such growing threats. It is contended that the combined forces of the legislature, the judiciary and the administration have at their disposal a veritable battery of weapons that is more than capable of dealing with the onslaught of these so-called fiscal and moral termites.

This article first discusses the relevant rules of interpretation on double taxation agreements with special emphasis on the new arrangement between the Mainland and Hong Kong. It then examines the legal status of the Commentaries to the Model Tax Conventions of the Organisation for Economic Co-operation and Development and the United Nations. It also examines the legal status of the Inland Revenue Department's new practice note on the double taxation arrangement between the Mainland and Hong Kong. This article then goes on to analyse the interaction between the Commentaries and the practice note. In interpreting the double taxation arrangement between the Mainland and Hong Kong, should tax practitioners follow the Commentaries or the practice note when a discrepancy occurs? Lastly, this article offers recommendations on resolving the uncertainties and complexities in the area of double taxation agreement interpretation.

This article considers the problems related to pathological arbitration clauses within the framework of international arbitration. After examining a series of typical examples of pathological arbitration clauses and acknowledging that the effectiveness of a pathological arbitration clause must be assessed in light of the rules applicable to it, the author considers how to determine such rules in the absence of a specific choice of law clause applicable to the arbitration agreement. Various approaches that have been followed by national courts and arbitral tribunals in the search for the law governing arbitration clauses are considered. The author focuses on two approaches: (i) a conflict of law-based approach, whereby the law applicable to the arbitration clause is determined by reference to the conflict of law rules of the lex fori; and (ii) a substantive rule method, whereby the rules governing the construction of pathological arbitration clauses are determined independently from any national system of law (including the conflict of law rules of the lex fori), through the direct application of general principles and usages of international trade. The author concludes that the latter approach is to be preferred because it is more consistent with the characteristics and features of international arbitration. The last part of the article shows how, in day-to-day practice, the application of the substantive rule method can be employed to cure pathological arbitration clauses so as to give effect to the parties' intention to refer their disputes to arbitration.

IT markets are of major importance for East Asian countries, if only because of their economic potential. Since the hardware-driven Information Technology Agreement (ITA) of 1996 has not been extended in its scope and the Doha negotiations to IT services have not substantially progressed, new initiatives should be taken by interested States. Different options are available, including the extension of the ITA and increased commitments for cross-border trade in business process outsourcing services. The time is ripe for the revitalisation of progress towards achieving higher levels of liberalization in the services trade.

Entering into the “Eleventh Five-Year” period, China is dedicated to transforming its former extensive economic mode into an intensive one. The transformation highlights China's latest national development strategy of “independent innovation” of which the institution of venture capital plays a crucial catalyst role. This article gives a comprehensive examination on the Chinese regulatory framework of venture capital activities. It intensively studies the phenomenon of the polarised performance between foreign and domestic players in China's venture capital market. This article finds that the legal institutions under which they operate contribute significantly to their performance. Based on the identified institutional gaps, suggestions are provided for the continuous legal reform in this area.

This article discusses the use of comparative law in the development of the constitutional jurisprudence of Hong Kong. It identifies the advantages of using comparative law and the problems associated with that use. Because the Basic Law and the Hong Kong Bill of Rights reflect international or comparative norms, there is much to be gained in Hong Kong from the use in various ways of comparative law in this respect. Hong Kong’s situation is to be distinguished from that of jurisdictions such as the United States and Australia whose constitutions came into existence before the development of the modern law of human rights and fundamental freedoms.

The article focuses on the role of the Secretary for Justice as the protector of the public interest in civil and criminal proceedings. In the context of intervention in civil proceedings, issues covered include whether the Secretary should appear as a party or as an amicus curiae; government interventions and situations where the court invites the Secretary to intervene. The role of the Secretary in relation to contempt of court that occurs outside the court, vexatious litigants, and coroners’ proceedings and as Protector of Charities is explained. The independent role of the Secretary for Justice in relation to prosecutorial decisions is examined. The fundamental principle of prosecutorial independence which has developed as a constitutional convention in other common law jurisdictions and is enshrined in Article 63 of the Basic Law is discussed, taking account of judicial respect for prosecutorial independence and accountability for prosecutorial decisions.

The author comments on President Hu’s four-point framework for the HKSAR and explains the “duality” of the Basic Law and the supposedly dialectical nature of the fangzhen that governs the policy direction for the OCTS model. The central thesis of the article is that, given the NPCSC’s plenary power of interpretation, it is only through constitutional commitment and self-restraint, especially on the part of the Central Authorities, and constant dialogue with the HKSAR that the “basic policies” enshrined in the JD and the Basic Law, including a “High Degree of Autonomy” for the Region, can be fully realised whilst not setting “One Country” on a collision course with “Two Systems.”

This article examines the place of the common law in Hong Kong (as an aspect of the separation of Hong Kong’s legal system from that of China, manifest in the underlying principle of the constitutional structuring of Hong Kong, “One Country Two Systems”). This is done by examining the points of intersection between Hong Kong’s legal and judicial system with that of the Mainland. The approach taken in this article can be called “political economy”, meaning that the interaction between the two systems of law can be explained more convincingly by the political forces behind each system of law than the superiority or otherwise of each system. The article concludes that although the Basic Law was generally read by most scholars in Hong Kong and elsewhere as aimed at giving significant autonomy to Hong Kong and circumscribing China’s power and jurisdiction in Hong Kong, this has turned out not to be the case. The legal foundations of autonomy were weak and the interpretations placed by China on the Basic Law, both its key provisions and the general scheme, have undermined autonomy. Weak in its legal system but strong in political control, the Chinese system has triumphed over the common law.

The author argues that by and large, fundamental rights have been upheld in the last decade. The promise of a high degree of autonomy has largely been kept as the Central Government has exercised great restraint in not interfering with the domestic affairs of Hong Kong, save in the area of democratic development. Nonetheless, many cases with political overtones are increasingly brought before the Courts. If this trend continues and if the judiciary is unable to meet the expectations of the people, the rule of law in Hong Kong will be undermined.

In this article, the author argues that the Court of Final Appeal is now cognisant of the repercussions of their decisions and has adopted a pragmatic view toward their adjudicatory role. Where decisions implicate the validity of PRC laws or NPCSC decisions, the Court defers to the Central Government. Notwithstanding the Court’s recognition of the supremacy of the NPCSC, the Court has remained diligent in preserving its prerogative as the primary interpreter of the Basic Law. Where disputes concern alleged human rights violations that have law and order implications in Hong Kong, the Courts are generally conservative and afford the Legislature or the Executive much latitude in maintaining peace and stability. With regard to disputes with neither NPCSC nor domestic law and order implications, the Court is confident that any political backlash against an adverse decision would be minimal; in these instances, the Court is enthused about providing a generous interpretation of the Basic Law.

The topic of self-incrimination has reached the Court of Final Appeal in only a handful of cases in its first decade. The Court decided most of these cases under the common law and in only one case was consideration given to the protections against self-incrimination under the Hong Kong Bill of Rights. While the Court has fortified the common law position in discrete areas, it has yet to recognise a constitutional right to silence which opens the door to greater coherence in the law and protection for individuals. This article analyses the case law on self-incrimination between 1997 and 2007 to identify general legal propositions, trends in the development of the jurisprudence, and possible areas of future development.

Most lawyers have a doctrinal understanding of the constitution. They are sceptical of any political understanding of a constitution, feeling that this may taint the sacredness of the legal paradigm. Political scientists view things differently. They offer three approaches to understanding a constitution from the perspective of the political paradigm: the attitudinal approach, the institutional approach and the strategic approach. The author argues that the incorporation of the political paradigm into one’s analytical framework is unavoidable if one wants to have a comprehensive understanding of the constitution. The author integrates the legal and political paradigms into the form of a constitutional game, and applies this analytical framework to the Basic Law, thereby illustrating how law and politics have interacted in the constitutional development of Hong Kong over the last 10 years.

Theoretically, Hong Kong deputies to the National People’s Congress (NPC) represent the interests of Hong Kong people in China’s highest organ of state power. The Central Authorities, through the Standing Committee of the NPC, exert a tight control over the electoral process in Hong Kong by making electoral rules, limiting the scope of eligible voters, and by utilising other formal and informal control mechanisms. Yet, a degree of autonomy in the electoral process produces results different from those expected by the Central Authorities. This article argues that the “small circle” election creates opportunities and incentives for developing special interests. Gradually, these special interests become entrenched and develop a life of their own.

Since the handover, significant changes have taken place in Hong Kong’s legal interpretive regime. The power of Hong Kong courts to interpret laws has been strengthened. They not only have the power to interpret local laws, but also are empowered to interpret the Basic Law. After the handover of Hong Kong to China the power of final adjudication of Hong Kong which was formerly held by the Judicial Committee of the Privy Council (PCJC) vests now in the Hong Kong Special Administrative Region (HKSAR) Court of Final Appeal. However the PCJC’s power of final legal interpretation for Hong Kong is now exercised by the Standing Committee of the National People’s Congress (NPCSC), an important component of Hong Kong’s new constitutional and legal system. Under the Basic Law, the “power of final interpretation” belongs to the NPCSC, but the “power of final adjudication” belongs to the HKSAR Court of Final Appeal. The separation of the “power of final interpretation” from the “power of final adjudication” not only is consistent with China’s constitutionalism and legal system, but also is a remarkable integration of “One Country” and “Two Systems.” Precisely in this sense, the NPCSC does not impinge upon the power of final adjudication held by the HKSAR Court of Final Appeal. The NPCSC is not the “court of final adjudication”, but rather only exercises the power of final interpretation of the Basic Law. It only “interprets” without “adjudicating,” and thus does not decide cases in place of the HKSAR courts, leaving the power of final adjudication to the HKSAR Court of Final Appeal. Therefore the interpretation of the Basic Law by the NPCSC will neither impinge on the HKSAR Court of Final Appeal’s power of final adjudication nor on its judicial independence.

On a proper interpretation of Article 158, the power of the NPCSC to interpret the Basic Law is limited to the provisions that are outside the limits of the autonomy of the Region. This proposition is supported by the legislative history of Article 158 and the general doctrine of delegation of powers in Chinese public law. It is also confirmed by the post-1997 practice of NPCSC of interpretation of the Basic Law. The opposite position that the Court of Final Appeal took is misguided and damaging to the high degree of autonomy of Hong Kong.

Both Hong Kong and Taiwan have been major sites of constitutional experimentation in East Asia in the last two decades. Constitutionalism is characterised by the rule of law and of the constitution, separation of powers and judicial independence, and the constitutional protection of human rights. It subjects political power to legal control, and enables peaceful transfer of political power in accordance with electoral rules of the game. Both Hong Kong and Taiwan have made significant progress in developing constitutionalism since the 1980s. This article compares the records of these two “islands” (territories) in this regard, and explore the future of a constitutionalism rooted in Chinese culture and society. It concludes that the constitutional projects in both Hong Kong and Taiwan are still works in progress that await completion.

If Japanese law, Korean law, Chinese law and others were each compared with their own legal heritage, it would be found that Chinese law would stand out as the one most divorced from its own traditions. For the whole of the twentieth century, the development of Chinese law and legal science was a process of learning from, making use of, absorbing and digesting foreign experiences. As far as legal institutions, principles and terminologies in the contemporary legal system in China are concerned, almost all were transplanted from foreign countries, though China’s own situation was considered. In fact, foreign laws are now an indispensable part of the main body of modern Chinese law.

The exemption from building controls for construction work inside a building which does not involve the structure of a building or any breach of building regulations is of relevance not just to the immediate question of whether particular work at a property requires permission from the Building Authority but also to the consequential question of whether the work may render title to the property bad. The exemption has recently been considered by both the Court of Appeal and the Court of Final Appeal. This article analyses those decisions and the extent to which they clarify the meaning and scope of the exemption and concludes that, whilst the Court of Final Appeal’s decision is helpful, it by no means resolves all difficulties.

The Law Reform Commission of Hong Kong’s report, released in August 2006, on Substitute Decision-Making and Advance Directives in Relation to Medical Treatment recommends, inter alia, that the definition of a “mentally incapacitated person” in the Mental Health Ordinance be expanded to include persons who are in a coma or vegetative state. This paper examines some of the issues which the Report considers as the basis for this recommendation and the problems associated with the recommendation. The author argues that although the Report addresses some key concerns, it omits other important considerations. The author concludes with a suggestion that the issue of decision making in relation to medical treatment, and other related issues, be examined again in the near future.

In Hong Kong, even though the Bill of Rights Ordinance (the domestic version of the International Covenant on Civil and Political Rights) was enacted in 1991, sexuality discrimination in legal discourse still persists: the age of consent for vaginal penetration (age 16) is lower than that of anal sex (age 21); the government insists on not tabling an anti-sexual-orientation discrimination bill; and the right to same sex marriage / partnership is absent from any legal-political agenda. Some politicians argue that discrimination is inherent in the Han-Chinese culture, which is impossible to understand from the Euro-American perspective of sexual justice. They further quote the Confucian five constant virtues (where only opposite sex marital relationships are mentioned), and the rules of Buddhism (which do not accept same sex relationships or anal sex) as examples showing that Han- Chinese culture cannot tolerate same sex eroticism. In this article, the author adopts a postcolonial theoretical perspective in examining the above arguments and points out that not only is a “pure” notion of Han-Chinese culture nonexistent, but (indigenous) culture should always be meticulously and critically examined and represented in order to reproduce “justice”. The author also argues that it is possible to scrutinise and explore the possible platforms of engagement within the Hong Kong Han-Chinese socio-legal culture where Euro-American sexuality studies and related legal development can be incorporated; the author also attempts to facilitate a reconstruction and reproduction of an aboriginal legal theory of sexual justice.

This article compares the systems for surveillance of adverse events following immunisation (AEFI) in Hong Kong and in the United States. It starts with an explanation of why AEFI surveillance is important from the standpoint of public health and good governance. The article proceeds with an examination of the Hong Kong AEFI surveillance system, established administratively recently within the Hong Kong Department of Health. It then describes the US AEFI surveillance system, established by law in circumstances of great controversy over legally required immunisations. The article then compares and contrasts the two systems and examines the legal reasons for the differences. The US system for AEFI surveillance is far more extensive than the system in Hong Kong. Aside from the obvious difference in size, the reasons for the disparity may largely be historical. However, the article argues that, pending improvements in computer integration at the Department of Health and the Hong Kong Hospital Authority, the Hong Kong system for AEFI surveillance could leapfrog that in the United States. Finally, the unfortunate situation of the AEFI surveillance system in mainland China and the consequent disqualification of the China State Food and Drug Administration as a fully functioning national regulatory authority for important purposes of the World Health Organization is noted.

The worldwide concern about the transboundary movement and disposal of hazardous wastes which heightened in the late 1970s and early 1980s culminated in the tightening of environmental laws in developed nations and the adoption of international instruments to address the movement and dumping of hazardous and toxic waste. The resulting rise in the costs of disposing hazardous waste in developed countries coupled with the globalisation of shipping has in turn created immense opportunities and incentives for illegal trafficking of wastes. The poorest of the poor are increasingly becoming the recipients of the hazards and poisons of the rich. Some figures estimate that toxic waste destined for “recycling” in Asian countries constitutes as much as 90 per cent of all toxic waste shipments. The fundamental question that the sad saga of the recent Cote d’Ivoire toxic waste dumping has thrown to the fore once again is how effective is the existing preventive or remedial action to combat the illegal transfer of, and illicit traffic in toxic and hazardous wastes in the face of the poverty of the world’s vulnerable and the politics of the rich.

In this article, based on the text of a keynote address presented at the 2007 LawAsia conference in Hong Kong, the author argues that international commercial litigation is in urgent need of reform at the international level, in order to reduce the costs of litigation and facilitate harmonization of civil procedure rules and mutual recognition and enforcement of court judgments. Such reforms are particularly needed in periods of economic decline, when commercial disputes in the courts naturally increase. The author proposes a number of measures to achieve these reforms, and argues for an early implementation, in anticipation of a future economic downturn.

The past 20 years have marked a movement in China’s stance from being a net capital importer towards being a net capital exporter. In the process, it appears that its tax treaty policy on deductions allowed to permanent establishments has changed accordingly. While it was previously in China’s interest to limit the deduction of expenses by permanent establishments to ensure that profit and tax was not extracted from China, the increase in China’s investment in foreign economies has meant that it is now becoming favourable for China to enter into tax treaties which allow permanent establishments to deduct more expenses. This trend is demonstrated by Article 7.3 of China’s tax treaties, which concerns the deductions allowed to permanent establishments. Article 7.3 of China’s tax treaties takes one of three forms: being a replication of the OECD Model, a replication of the UN Model or an independent version. This article submits that as China moves from being a capital importing towards being a capital exporting country, its tax treaty approach has accordingly shifted from using Article 7.3 of the UN Model towards using Article 7.3 of the OECD Model.

After unprecedented discussion, on 16 March 2007, China’s legislature passed the Property Law which guarantees private property rights and thus has been acclaimed as progress in the development of China’s (post-)socialist property rights regime. The purpose of this article is to analyse the Property Law’s capacity to address illegal land takings, one of the chief externalities of the country’s development. The article argues that in the context of fazhi (“rule of law”), legislation is increasingly seen as a source of legitimisation. Nonetheless, fazhi operates as an ideology that is both produced by and productive of inequalities accompanying China’s growth. A description of the problem of takings and the social violence they generate is followed by an overview of existing legislation. The legislative history of the Property Law and particularly the debates that surrounded it demonstrate that while such discourses were interpreted as signifying rule of law, the debates ironically institutionalised vagueness in the Property Law on the issues of expropriation, public interest, and adequate compensation. Finally, the article considers a broader view of property reform by analysing different models of property rights in transitional economies and applies a view developed in legal anthropology to posit a basis for property reform based not just on legislation but on structural reforms that address the disconnect between China’s marketisation and the administrative and political hierarchies in the countryside.

Since the 1990s, some scholars have been suggesting that China is acting federalist – that it is “de facto federalist.” To date, there has been no comprehensive response disputing the claim. This article fills much of that gap, suggesting that the central government’s control of population migration, provincial leaders, money, and development all belie the characterisation of China as “de facto federalist.” The result is the voice of the other side of the new debate, one which will enlighten readers on the country set to make the most difference on the world in the twentyfirst century.