Sydney’s attempt to take a bite out of the arbitration and dispute resolution market from Hong Kong and Singapore should not worry local law firms in Asia, according to one of the lawyers involved in establishing the new international arbitration centre in Sydney.
The Australian government announced last week that it would fund the establishment of a new centre in Sydney, planned for launch as early as May this year. It will be the first in Australia and will follow a similar model to established international arbitration centres in Singapore and Hong Kong. The government hopes to lure some of the ADR market from Asia. “The fact is that international arbitration is emerging as the preferred choice for resolving commercial disputes, particularly by Asian business,” said NSW Attorney-General John Hatzistergos.
Holman Fenwick Willan’s Sydney-based partner Alex Baykitch (pictured), as the vice president of the Australian Centre for International Commercial Arbitration (ACICA), was involved in establishing the centre along with ACICA president Doug Jones (also a partner at Clayton Utz). Baykitch said that law firms in Asia should not be worried about losing work to Sydney. “I think competition is a good thing but … I don’t think you’ll see a flood of work coming to Australia away from Singapore. With Maxwell Chambers and the promotion by its government, Singapore will always be the premiere choice because it is the hub between East and West,” he said.
Baykitch added that Sydney will attract dispute resolution matters not only from Asia but also from the US, as new airline routes bridged distance. “It’s often stated that Sydney isn’t as attractive as Singapore or Hong Kong because of the distance, and whilst that might be true in disputes involving parties in Europe, it’s certainly not the case with parties in the US,” he said. “There are companies who may be a little uncomfortable about doing business in Asia and they’re the sort of companies who would be attracted to Sydney. I think if Sydney can attract up to 50 cases a year, we’ll be doing well.”
Holman Fenwick Willan has offices in Hong Kong and Singapore and a recently launched office in Sydney. Baykitch said that the new Sydney centre will provide more choice for firms like HFW with multiple branches across the Asia-Pacific. “We act for a lot of foreign companies doing business in Asia and sometimes the choice is limited to Hong Kong and Singapore. The Sydney offering means more choice and it will mean an increase in work,” he said.
David Bateson, a dispute resolution partner at Australian firm Mallesons Stephen Jaques’ Hong Kong office, said the Sydney centre isn’t likely to be a major threat to firms in Asia. “Australia has a well developed judiciary but it is geographically remote so the arbitration centre will not compete effectively with Hong Kong and Singapore. They also need make the tax regime more competitive,” he said.
Bateson is confident in Hong Kong’s status as an arbitration hub. “The SIAC has considerably raised the bar for infrastructure and government support and although it will attract India cases, the HKIAC still handles three times as many cases, and China cases will continue to [grow],” he said.
Nick Gall, joint founder of Hong Kong dispute resolution firm Gall & Lane, agreed, adding that Hong Kong will maintain a niche in the market. “There’ll be enough work in the market to sustain all three centres. We’re not concerned that the market will be lost to Sydney because each centre has a distinct market to successfully operate independently,” he said.
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