On 14 May 2021, the Hong Kong SAR Government and the PRC Supreme People's Court signed a Record of Meeting setting out a landmark consensus for mutual recognition and assistance of insolvency proceedings between designated Mainland municipalities and Hong Kong.
In conjunction with the Record of Meeting, the PRC Supreme People's Court (SPC) issued a guiding opinion (SPC Opinion) and the Hong Kong SAR Government issued a practical guide, both of which provide further guidance on applications for recognition and assistance in designated Mainland municipalities and Hong Kong respectively.
The SPC Opinion designates Shanghai, Shenzhen, and Xiamen as pilot cities that will recognise and provide assistance to Hong Kong insolvency proceedings. It is anticipated that the framework will be expanded to further Mainland municipalities in the future.
In this briefing, we highlight the key features of this new framework for Hong Kong insolvency proceedings as well as its potential impact on cross-border insolvency proceedings involving both Mainland China and Hong Kong.