In discussing Hong Kong’s legal system and pool of legal talent, Justice Minister Paul Lam recently highlighted both the appeal and potential concern for the future of the rule of law in the Chinese territory.
With a large number of lawyers and law firms, including international practices, Hong Kong has established itself as a global legal hub. Its common law system, robust capital markets, and active financial sector make it attractive to top global firms, with many prestigious firms having an office presence in the city.
However, as Beijing tightens its grip and broadens the scope of the national security law, legal practitioners, including corporate lawyers, are worried about the potential impact on the independence of Hong Kong’s legal system, which is a legacy of British administration.
Human rights and criminal lawyers have already felt the effects of the national security law, with several individuals targeted for their involvement in pro-democracy protests. Foreign lawyers have been banned from representing defendants in national security cases, further limiting the legal options available.
The crackdown on human rights has also affected corporate law firms. Chinese state-owned enterprises have ceased working with Mayer Brown after the firm declined to represent the University of Hong Kong in a dispute over the removal of a memorial. This shift has led some multinational clients to reconsider using Hong Kong law for long-term contracts and to explore alternatives like Singapore.
Uncertainty surrounding Hong Kong’s legal system, coupled with its slowing economy and weaker IPO activity, is causing pressure on the corporate legal sector. The number of registered foreign lawyers in Hong Kong has decreased, and foreign corporate lawyers are less willing to relocate to the city compared to previous years.
While Hong Kong officials maintain that the common law system remains intact, some lawyers express concerns about the risks involved and the need for certainty in legal matters.
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