Singapore has over the past three years surpassed Hong Kong in popularity as an international arbitration seat, according to a recent study.
A report released jointly by the School of International Arbitration at Queen Mary University of London and the U.S. firm White & Case found Singapore to be the third most preferred arbitration seat globally, after London and Paris. Hong Kong ranked fourth.
As part of the study, 922 respondents—mostly private practitioners and arbitrators—identified up to five arbitration seats preferred by their organizations. Out of the more than 140 arbitration seats listed by respondents worldwide, according to the survey, London emerged as the top location with 64 percent of those surveyed ranking it as one of the top five; Paris, Singapore, Hong Kong and Geneva claimed the second to fifth spots.
Between the two Asian seats, Singapore was preferred by 39 percent of the respondents, whereas Hong Kong received votes from 28 percent of those surveyed. In a previous edition of this study, released in 2015, Hong Kong was identified by 30 percent of the respondents as one of the top three preferred arbitration seats, ranking third after London and Paris, whereas Singapore ranked fourth, with 24 percent of respondents voting for it.
In fact, according to the most recent report, the switch in rank between Singapore and Hong Kong was the only change among the top seven most favored arbitration seats (New York and Stockholm placed sixth and seventh) compared with the results three years ago.
In addition, the study broke down the survey results by six different regions worldwide and Singapore ranked in the top four most preferred seats in five out of the six regions: Europe (4th), Asia Pacific (2nd), North America (4th), Africa (4th) and Middle East (3rd).
Hong Kong only made the top four among respondents practicing in the Asia Pacific, placing third after London and Singapore.
In 2017, the Singapore International Arbitration Centre handled 452 new cases, up 32 percent from a year earlier. In 2016, the year when the most updated statistics were available from the Hong Kong International Arbitration Centre, the HKIAC took on 460 new cases, down 11.5 percent from 2015′s 520 new cases.
According to the Queen Mary University of London/White & Case study, the top reason respondents gave for choosing a seat for arbitration cases was the jurisdiction’s general reputation and recognition; that was followed by the neutrality and impartiality of the local legal system, and its own arbitration law and track record in enforcing settlements and awards.
In 2017, both Hong Kong and Singapore passed legislation that will enable parties to seek third-party funding for arbitration cases. Several cases have emerged in Singapore using third-party funding since the new law became effective on March 1, 2017. Hong Kong’s third-party arbitration funding regime has not yet taken effect, pending regulatory guidelines.