As arbitration has established itself as the leading process for resolving international business disputes, Hong Kong has established itself as a key arbitration centre, Secretary for Justice Wong Yan-lung says.

Addressing the "Arbitration in China" conference today, Mr Wong described some of Hong Kong's underlying strengths as a dispute-resolution centre. Notably, he said, it boasts the world-class Hong Kong International Arbitration Centre which makes about 300 awards each year.

The centre was set up in 1985 with the support of the Government and the private sector, and provides an independent venue for dispute resolution. In the past decade or so, it has seen a remarkable growth in its caseload.

In 1992, it provided arbitration services in 184 cases. By 2004, its caseload went up to 280 cases. Mr Wong said these figures compare favourably with figures for arbitrations in London - which saw only 21 and 87 cases in those two years - and in Singapore, where the figures were seven and 51.

He noted a steady growth in the centre's arbitration services in relation to cross-boundary trade. Of the 280 cases in 2004, 20 cases involved both parties being Mainland entities or nationals, compared with only five cases in 2000. The amounts in dispute ranged from $20,000 to over $460 million.

He cited other strong reasons for Hong Kong's draw on an arbitration centre, including:

* its sound legal system, based upon the rule of law, an independent judiciary, and common law principles which are widely recognised and respected by the international business sector;

* its wealth of English-speaking legal practitioners and internationally renowned arbitrators specialising in litigation and arbitration services; and its wealth of Chinese-speaking practitioners with knowledge of China, of market operations in the Mainland, and of Chinese law, who are experienced in handling the negotiation and preparation of Mainland legal documentation;

* Hong Kong's status as a world centre of expertise in commerce, finance, IT, shipping and construction, with an enormous pool of experienced professionals offering specialist advice and assistance in dispute resolution;

* its ideal geographic location, which enables Hong Kong lawyers and Mainland investors to conduct business efficiently and cost-effectively; and

* its combination of superb infrastructure, first-rate communication and transport systems, and excellent choices of accommodation.

One of the Justice Department's policy objectives is to assist in building up Hong Kong as a regional centre for legal services and dispute resolution, Mr Wong said.

Its targets in pursuing this include:

* promoting understanding in the Mainland and in other countries of the advantages that Hong Kong offers as a regional centre for legal services and dispute resolution;

* making Hong Kong more attractive as a dispute-resolution centre; and

* improving the regulatory framework within which lawyers can provide their services in Hong Kong.

The increasing number of Mainland companies choosing to arbitrate in Hong Kong has led to a recent development in local arbitration procedures. It became apparent to the centre that many Mainland companies are not familiar with the ad hoc procedures that commonly apply to arbitrations in Hong Kong, Mr Wong said.

Under the Mainland system, all arbitrations are referred to an arbitration commission for administration. Mainland parties are not therefore familiar with Hong Kong arrangements whereby, after an arbitrator is appointed, he or she may handle the arbitration independently of any arbitration commission.