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Global rules on foreign direct investment (FDI)
Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
Hong Kong SAR | Publication | November 2021
Yes, in Hong Kong there are two limbs of legal professional privilege: legal advice privilege and litigation privilege.
Legal professional privilege exists under common law in Hong Kong, and is enshrined in Article 35 of the Basic Law which provides that “Hong Kong residents shall have the right to confidential legal advice …”.
Legal advice privilege attaches to confidential communications between a lawyer and a client made for the dominant purpose of obtaining or giving legal advice.
Litigation privilege attaches to confidential communications between a lawyer and a client, or between one of them and a third party, made for the dominant purpose of obtaining or giving information or legal advice in relation to an actual or contemplated litigation.
Legal professional privilege applies to both barristers and solicitors.
Legal professional privilege equally applies to an in-house lawyer as to a qualified lawyer, provided that the in-house lawyer is a professionally qualified lawyer and acting as such.
Despite there being no legal recognition for the qualification of a patent or trade mark attorney in Hong Kong, litigation privilege may still apply in relation to communications between a patent / trade mark attorney and a lawyer or a client.
Pursuant to section 39A(2) of the Legal Practitioners Ordinance (Cap. 159), solicitor-client privilege exists between a foreign lawyer and their client to the same extent as the privilege exists between a solicitor and their client. It is therefore permissible to assert legal professional privilege over legal advice sought from foreign lawyers.
Legal professional privilege applies to contents of communications, the forms of which are wide and are not limited to paper documents, thus covering electronic documents such as emails and recordings of phone conversations, including their copies.
Circumstances surrounding the communication are not protected by legal professional privilege. Legal professional privilege attaches to communications only but not to objects or facts independent of the communication.
Furthermore, communications made or brought into existence for crime, fraud or abuse of statutory power are not protected by legal professional privilege.
Only the client can waive legal professional privilege. A lawyer must obtain the consent of the client before waiving legal professional privilege on behalf of the client.
Legal professional privilege can be waived expressly, such as disclosing privileged documents to a third party. It can also be waived impliedly, such as referring to a privileged document in a pleading (as the other side of the litigation can exercise the right to seek inspection of such a document).
A partial or limited waiver of legal professional privilege for a specified purpose is allowed so that legal professional privilege is not lost for other purposes.
Once legal professional privilege is waived, it is unlikely that a party can seek to restrain disclosure or restore legal professional privilege.
Yes, the implied undertaking not to use discovered information for any collateral purpose other than for the conduct of the action unless the information is read to or by the court or referred to in open court is recognised under Order 14A of the Rules of the High Court (Cap. 4A).
The implied undertaking exists under the common law, see for example Bentley & Anor v Parry & Anor [1993] 1 HKC 298 (CA).
The implied undertaking applies to documents obtained on discovery. It continues after the proceedings have concluded, and survives the death of the party disclosing the documents. As stated above, the implied undertaking ceases when the information is read to or by the court or referred to in open court. The implied undertaking also does not apply to documents provided voluntarily, including those referred to in a party’s pleadings, affidavits, witness statements or expert reports.
A party can be released from the implied undertaking by the Court, but this will only be possible in special circumstances and where the release or modification will not occasion injustice to the person giving discovery. The court’s power to release a party from such undertaking is discretionary.
A party can breach such implied undertaking if the party uses discovered information for any collateral or ulterior purpose other than for the conduct of the action, such as using those information for another litigation or for an unrelated counterclaim within the same action. A party that breaches the obligation can be liable for contempt of court.
If a breach comes to a party’s attention, that party that has disclosed documents on discovery should seek the court’s protection by way of injunction against the misuse of those documents.
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Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
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On February 2, 2024, the Belgian Presidency of the Council of the European Union confirmed that the Committee of Permanent Representatives had signed the Artificial Intelligence (AI) Regulation, referred to as the AI Act. Approval by the EU Parliament followed on 13 March 2024, and the AI Act is likely to appear in the EU’s Official Journal around May 2024. The AI Act aims to establish a stringent legal framework governing the development, marketing, and utilisation of artificial intelligence within the region, thereby marking a significant advancement in the regulation of this burgeoning domain.
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