Law Reform Commission’s Consultation Paper on Outcome Related Fee Structures for Arbitration

In December 2020, the Outcome Related Fee Structures for Arbitration Sub-committee of the Law Reform Commission (“LRC”) launched a public consultation on Outcome Related Fee Structures (“ORFS”) for arbitration. The Sub-Committee of the LRC invites views and proposals on, among other things, (i) whether the law of Hong Kong should be amended to permit lawyers in Hong Kong to enter into ORFS for arbitration conducted in and outside Hong Kong; (ii) appropriate amendments to the applicable laws and code of practices; and (iii) appropriate safeguards to the general public, if applicable.

With the assistance of the Arbitration Committee and other relevant specialist committees and working parties, the Council reviewed the recommendations in the Consultation Paper, and produced a submission in response. In principle, the Law Society supports the removal of the prohibitions on the use of ORFS in arbitration, in order to enable lawyers in Hong Kong to compete with lawyers in other jurisdictions in a level playing field in arbitration. That helps maintain Hong Kong’s status as a leading arbitration hub. The Law Society also takes the view that, among other things, lawyers and their clients in arbitration matters should have the liberty to negotiate and agree on the terms of their ORFS agreements.

The Law Society welcomes continual discussion of this important matter, and is prepared to be engaged in the further deliberation which should be arranged as soon as practicable.

The submission on the above could be found here: