Where arbitrating a construction or infrastructure

A contractor finishes a major infrastructure project across two jurisdictions, presents its final account, and receives nothing. The employer – a state-linked entity incorporated offshore, operating through a Mainland Chinese subsidiary – disputes the claim in full. The contract says Hong Kong arbitration. The assets sit in the Mainland. The question is not whether the contractor can win. The question is whether a win means anything.

Arbitrating a construction or infrastructure dispute in Asia requires managing two distinct problems simultaneously: winning the award on the merits under the applicable construction law and enforcement rules, and then converting that award into actual recovery across the jurisdictions where the respondent's assets are held. Hong Kong seated arbitration, governed by the Arbitration Ordinance (Cap. 609) and the HKIAC Administered Arbitration Rules, remains the dominant forum for cross-border construction and infrastructure disputes in the region – precisely because the enforcement route through Hong Kong into the Mainland, via the mutual enforcement arrangements between the two jurisdictions, is the most tested and legally predictable pathway available. The current position, following the 2024 HKIAC Rules in force from 1 June 2024 and the reciprocal judgment enforcement regime that took effect on 29 January 2024, is more capable than the regime that existed five years ago – and more demanding of the parties who use it.

This analysis works through the commercial stakes, the governing instruments, the cross-border interface, the comparative position across the principal enforcement corridors, and our assessment of where the real risk now sits for claimants and respondents in large Asian construction and infrastructure disputes.

What is actually at stake commercially in Asian construction arbitration?

Construction and infrastructure disputes in Asia are not ordinary commercial arbitrations that happen to involve a contract. They are, almost always, disputes about who bears the risk of a project that went wrong at scale – and the financial exposure is compounded by the cross-border structure of the project itself.

A typical pattern in our cross-border practice: an international or regional contractor is engaged under an EPC (engineering, procurement and construction, the contract form that places the whole delivery risk on the contractor) or a design-build contract. The employer is a special purpose vehicle incorporated in the BVI or Cayman Islands, held by a state or quasi-state entity in the Mainland, the Middle East or Southeast Asia. Financing comes from a Mainland bank or a development bank with a separate security and intercreditor structure. The project sits physically in one country; the contract is governed by another law; the arbitration clause specifies a third seat.

When the dispute crystallises – typically over delay, variation claims, force majeure, or a disputed final account – the claimant faces the following commercial reality. The SPV (special purpose vehicle) may hold no assets outside the project itself. The real value – the operating revenue, the bank accounts, the upstream shareholding – sits either in the Mainland entity or at the level of the ultimate parent. An award against the SPV alone may be unenforceable in any meaningful sense. The endgame, in almost every large Asian construction dispute, is not the award. It is the enforcement route to the assets.

This is why seat selection, arbitration agreement drafting, and interim measures strategy are not procedural housekeeping. They are the commercial core of the dispute. A Hong Kong seat creates access to the interim-measures arrangement with the Mainland courts that has been in effect since 1 October 2019 – the only arrangement of its kind globally between Hong Kong and Mainland Chinese courts for arbitral interim relief. No other offshore seat offers that direct route.

What governs an Asian construction arbitration seated in Hong Kong?

The Arbitration Ordinance (Cap. 609) is the statutory foundation. It is modelled on the UNCITRAL Model Law on International Commercial Arbitration, which means the procedural framework is internationally familiar – emergency relief, interim measures, challenge procedures, and enforcement are all structured in line with what international construction practitioners expect from a sophisticated common-law arbitration seat.

The HKIAC Administered Arbitration Rules sit above that statutory floor. The 2024 Rules, effective from 1 June 2024, updated and streamlined a number of construction-relevant provisions. Emergency arbitrators – a mechanism widely used in construction disputes to freeze assets or prevent destruction of project records – operate within a target of completing proceedings within 14 days of file transmission. Expedited procedures produce an award within six months of file transfer to the tribunal, extendable in appropriate circumstances; for mid-sized disputes where delay is itself the main damage, that timeline matters. In standard proceedings, the award is due within three months of closure of proceedings, which itself must occur no later than 45 days after the last directed substantive submissions.

For construction disputes specifically, these timelines interact with the technical complexity of the claims. A major delay and disruption claim – with a programme expert, a quantum expert, and thousands of contemporaneous project documents – rarely fits a six-month expedited window. Practitioners choose expedited process for liability disputes or urgent injunctive relief, and full proceedings for valuation and quantum. Getting that choice right at the outset is, in our experience, one of the first strategic decisions that shapes the outcome.

The New York Convention applies to Hong Kong, allowing awards made here to be enforced in the more than 170 contracting states. For Mainland China assets specifically, however, the applicable route is not the New York Convention but the dedicated mutual enforcement arrangements between the Mainland and the HKSAR – a point that continues to catch international counsel who do not routinely practise in this corridor.

The sequence above describes the standard governing position. Your matter turns on the documents, the jurisdictions actually engaged, and the order of steps – which is where the route is won or lost.

To assess how the Arbitration Ordinance and the HKIAC Rules apply to your cross-border construction position, write to us at info@lockhartyip.com.

How does the cross-border interface actually bite in practice?

The cross-border interface in Asian construction disputes operates at three levels: interim relief before the award, enforcement of the award itself, and the interaction with Mainland or foreign court proceedings that may run in parallel.

At the interim-relief level, the arrangement that took effect in October 2019 allows a party to a Hong Kong-seated arbitration to apply to a competent Mainland court – specifically the courts designated under that arrangement – for interim measures in aid of the arbitration. This means asset preservation, evidence preservation, and conduct orders. The application can be made before or after the tribunal is constituted, and it reaches assets in the Mainland directly. No equivalent route exists for Singapore-seated or London-seated arbitrations with Mainland assets. For a contractor who needs to freeze a state-linked employer's bank accounts during a fast-moving dispute, that difference is decisive.

At the award-enforcement level, the position is governed by the 1999 Arrangement and the 2020 Supplemental Arrangement for mutual enforcement of arbitral awards. Critically, since a 2021 amendment to that regime, parties may make simultaneous enforcement applications – one in Hong Kong, one in the Mainland – rather than having to choose a single jurisdiction first. This removed a significant tactical vulnerability: under the older regime, a respondent could delay enforcement by challenging in one jurisdiction while the claimant was barred from proceeding in the other.

At the parallel-proceedings level, construction disputes frequently involve domestic litigation in the project country running alongside the arbitration. A state-linked employer may file domestic proceedings as a tactical measure, seeking to relitigate issues in a forum it controls. The Mainland Judgments in Civil and Commercial Matters (Reciprocal Enforcement) Ordinance (Cap. 645), in force since 29 January 2024, is now the primary instrument for registering effective Mainland judgments in Hong Kong and vice versa. Its scope is broad – monetary and non-monetary judgments – and it removed the old requirement that the Mainland court have exclusive jurisdiction under a written choice-of-court agreement. The practical effect is that a Mainland judgment against a claimant contractor, even in proceedings commenced without a valid choice-of-court clause, may now be registrable in Hong Kong. Claimants need to monitor and respond to parallel domestic proceedings, not simply ignore them.

Consider a recent pattern from our desk. A European infrastructure group, acting as EPC contractor on a Southeast Asian power project with a Mainland-incorporated employer, obtained an HKIAC award on liability. The enforcement attempt in the Mainland stalled because the group had not taken interim measures during the arbitration and the employer had dissipated assets through intergroup transfers while proceedings ran. The award was correct. The recovery was minimal. The lesson is not to win faster; it is to run the enforcement strategy in parallel with the merits strategy from day one.

How does Hong Kong compare with alternative seats for this dispute type?

The two most common alternatives to Hong Kong for Asian construction arbitration are Singapore (under the SIAC Administered Arbitration Rules, at the Singapore International Arbitration Centre) and London (under the ICC International Court of Arbitration Rules or LCIA rules). A third, smaller category uses CIETAC (China International Economic and Trade Arbitration Commission, the principal PRC-domestic arbitration body) or local domestic institutions.

Hong Kong's structural advantage for disputes with Mainland Chinese counterparties or assets is the direct interim-measures corridor described above. Singapore does not have an equivalent arrangement with Mainland courts. An award creditor with Mainland assets and a Singapore seat must enforce under the New York Convention through the Mainland courts' ordinary recognition process – procedurally valid but without the designated-court access and the simultaneous-application right that the Hong Kong–Mainland arrangements provide.

London is the preferred seat for projects financed by multilateral lenders or where the governing law is English law and the counterparties are non-Asian. For disputes with Mainland China exposure, however, a London seat means no direct interim-measures route into the Mainland and a New York Convention recognition process that, in practice, can face resistance where a Mainland respondent disputes the scope of the arbitration agreement. Hong Kong courts' familiarity with Mainland procedure – and the Mainland courts' reciprocal familiarity with Hong Kong-issued materials – is not replicated in any other common-law seat.

CIETAC and domestic Chinese arbitration produce awards that, if made in the Mainland, are enforceable as domestic awards in Chinese courts. They are also enforceable in Hong Kong under the 1999 Arrangement. The limitation is the institutional and procedural concern that a party without Mainland Chinese ties may have about arbitrating before a domestic institution in the respondent's home jurisdiction. For joint ventures, domestic projects and construction contracts where both parties are Mainland-incorporated, CIETAC can be appropriate. For cross-border projects with international contractors, the preference is ordinarily for Hong Kong or Singapore.

The comparative read reduces to a single test: where do the assets sit, and which enforcement corridor reaches them fastest? If the answer is the Mainland, Hong Kong wins the comparison on institutional grounds that are not currently replicated elsewhere.

If an earlier filing, structure or enforcement attempt produced an adverse or stalled result, a second read can identify the strategic error and the routes still open. Write to us at info@lockhartyip.com.

Where does the risk actually sit now for claimants and respondents?

Our assessment, based on the current state of the instruments and the patterns we see in cross-border construction disputes, is that the risk distribution has shifted in the last three years – but not evenly, and not always in the direction that claimants expect.

For claimants, the enforcement environment is materially better than it was before the 2021 simultaneous-application amendment and the 2024 reciprocal judgment ordinance. The ability to pursue an HKIAC award simultaneously in Hong Kong and the Mainland eliminates the single most damaging tactical vulnerability of the prior regime. The interim-measures arrangement, now well into its operational phase, gives claimants a real tool for asset preservation during arbitration – but only if they use it. The risk for claimants now is not structural; it is operational. Claimants who treat enforcement as a post-award question, rather than a parallel-track strategy from the notice of arbitration onward, continue to find that correct awards produce inadequate recovery.

For respondents – typically the employer or the state-linked entity that commissioned the project – the current environment provides fewer safe harbours than five years ago. Asset-dissipation strategies that worked before simultaneous enforcement was available are now more exposed. Parallel domestic proceedings that might previously have delayed Hong Kong enforcement are now subject to the possibility that the resulting Mainland judgment is registrable in Hong Kong under Cap. 645, which cuts both ways.

There is one area where the risk picture is genuinely unclear: disputes involving publicly funded infrastructure and state immunity. The PRC Foreign States Immunity Law, which came into force on 1 January 2024, adopts a restrictive doctrine of state immunity – meaning states cannot generally assert immunity for commercial transactions. How that law interacts with enforcement of arbitral awards against state-linked entities is still developing. For disputes against entities that may invoke state character, the immunity question should be assessed before arbitration is commenced, not after an award is obtained.

A second area of developing risk is the increasing use of emergency arbitrator applications in construction disputes. The 14-day target for HKIAC emergency proceedings is operationally tight for complex construction fact patterns. Applications that are under-evidenced or procedurally incomplete fail. Respondents who receive emergency applications have a genuine opportunity to defeat them on evidentiary grounds if the applicant has not prepared adequately. In our experience, the emergency arbitrator mechanism is used more often than it should be, and used less well than it could be, on both sides.

What claimants consistently get wrong – and what respondents miss

International construction practitioners who have not litigated or arbitrated regularly in the Hong Kong–Mainland corridor make a set of recurring errors. Identifying them is useful precisely because they affect the commercial outcome, not just the procedural record.

The most common claimant error is treating the arbitration agreement as a self-executing mechanism. A well-drafted Hong Kong arbitration clause – specific institution named, seat specified as Hong Kong, governing law designated – is necessary but not sufficient. The clause must also address: which entity is bound (the SPV, the parent, both?), whether the employer's obligations under upstream financing documents are brought in, and how third-party rights in subcontract chains are managed. Where a contractor has a claim against a subcontractor who has a separate arbitration clause in a different jurisdiction, the resulting parallel proceedings create fragmentation that is expensive and sometimes strategically fatal.

The second claimant error is under-investing in contemporaneous records. Construction arbitration is won and lost on documents generated during the project. A properly maintained claims register, a contemporaneous delay analysis, and a document-control system that produces a credible record at the claim stage are not administrative niceties. They are the evidentiary foundation. Tribunals see this acutely: a well-documented claim with modest quantum often does better than a large undocumented claim.

For respondents, the consistent error is the mirror image. A state-linked employer that receives a notice of arbitration and refers it to domestic legal counsel unfamiliar with HKIAC procedure loses valuable early choices – particularly on tribunal constitution, the timing of any challenge to jurisdiction, and whether to make its own interim-measures application. Jurisdictional objections under the Arbitration Ordinance have procedural consequences if raised late. Respondents who engage Hong Kong-familiar counsel early have consistently more options than those who do not.

A practical illustration: an Asian state utility, acting as employer on a wind-power EPC contract, received an HKIAC notice in early 2025. The notice was referred to domestic counsel in the project country, who advised the utility to ignore the proceedings pending a domestic court ruling on arbitral jurisdiction. The HKIAC tribunal was constituted, a hearing was held in the utility's absence, and an award was issued. Enforcement proceedings in Hong Kong followed. The utility's subsequent attempts to challenge the award on public-policy grounds faced the well-tested Hong Kong position: courts here maintain a strong pro-enforcement posture and set aside awards on narrow grounds only. The utility spent more defending the enforcement than it would have spent engaging in the arbitration.

The interim-measures question – how to run it right

Interim measures in construction arbitration deserve separate treatment because they are the enforcement instrument most frequently misapplied – in both directions.

Under the Arbitration Ordinance and the HKIAC Rules, a party to a Hong Kong-seated arbitration may apply to the HKIAC for an emergency arbitrator or, once the tribunal is constituted, to the tribunal itself for interim relief. Separately – and this is the corridor that matters for Mainland assets – a party may apply to a designated Mainland court under the interim-measures arrangement that has been in effect since 1 October 2019. The two routes can be used together: emergency arbitrator proceedings in Hong Kong for assets outside the Mainland, and a designated-court application in the Mainland for assets there.

The practical requirements for a successful Mainland interim-measures application are more specific than the general HKIAC emergency procedure. The application must be made to the correct designated court – not any Mainland court, but the specific courts approved under the arrangement for the jurisdiction where the assets or the respondent are located. The supporting materials must be translated into simplified Chinese, notarised, and presented in the correct form. Errors in the court identification or the document package result in rejection, not correction. Speed is essential: a respondent who learns that an application is coming has time to move assets.

Where the assets include both Mainland accounts and offshore accounts in BVI or Cayman holding entities, the interim-measures strategy must address all layers simultaneously. The BVI and Cayman courts have their own asset-freezing regimes – developed, common-law based, and generally willing to grant Mareva-style (freezing order, the form of injunction restraining a respondent from disposing of assets pending judgment or award) relief in support of arbitral proceedings. Coordinating a Mainland application, a Hong Kong emergency arbitrator, and a BVI or Cayman freezing application requires a multi-jurisdictional team operating to a common timeline and a common factual record. That coordination, done properly, is the most effective enforcement-preservation tool available in the current environment.

Our read – where this is heading

The trajectory of Asian construction arbitration over the past three years has been toward greater procedural sophistication, better enforcement tools, and – as a consequence – higher expectations of the advisers managing the disputes. The instruments are now in place. The question is whether parties and their counsel use them in the right sequence.

Our view is that the next development to watch is the interaction between the 2024 reciprocal judgment enforcement ordinance and the construction sector. Cap. 645 applies to both monetary and non-monetary judgments, and its removal of the old exclusive-jurisdiction requirement creates a materially wider registration pathway for Mainland judgments in Hong Kong. For construction disputes where a Mainland employer has sought domestic relief – a declaration of no liability, a set-off order, or a damages counterclaim – the enforceability of that domestic judgment in Hong Kong is now a live question, not a theoretical one. The first test cases under Cap. 645 in a construction-dispute context will shape how the courts manage the intersection between the arbitral-award regime and the judgment-recognition regime.

The second development worth tracking is the evolving approach to multiparty disputes. Construction projects routinely involve contractors, subcontractors, employers, engineers, lenders, and insurers. When a dispute involves parties at multiple levels of the contractual chain, the arbitration framework must aggregate those claims efficiently or they fragment into parallel proceedings that are expensive and produce inconsistent results. The HKIAC 2024 Rules include joinder and consolidation provisions, but their use in complex construction matters remains developing.

For our practice, the consistent theme is this: in cross-border Asian construction disputes, the award is the beginning of the legal problem, not the end. The endgame is the asset. Understanding the enforcement routes – and building the strategy around them from the first day of the dispute – is, in our assessment, what separates recoveries from write-offs.

Related practices

Disputes & Arbitration – cross-border arbitration strategy, enforcement and interim relief across Greater China
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Frequently asked questions

What is the first step in arbitrating a construction or infrastructure dispute in Asia?

The first step is to verify that the arbitration agreement is binding, properly constituted, and covers the dispute in question – including identifying which entities in a project structure are bound by the clause and which are not. Once that is confirmed, the claimant should issue a notice of arbitration to the named institution (in most cross-border Asian construction matters, the HKIAC) while simultaneously assessing whether interim measures are required to preserve assets before the respondent can reorganise its position. The enforcement route – particularly for Mainland Chinese assets – should be mapped at the same time, not after an award is obtained.

How does the cross-border element affect arbitrating a construction or infrastructure dispute in Asia?

The cross-border element affects the dispute at every stage. At the interim-measures stage, the corridor available to a Hong Kong-seated arbitration for Mainland Chinese assets – the arrangement in effect since 1 October 2019 – does not exist for other seats, which changes the practical value of a Hong Kong clause where Mainland assets are the target of enforcement. At the enforcement stage, the simultaneous-application right under the mutual enforcement arrangements means that the claimant need not choose a single jurisdiction and can pursue Hong Kong and Mainland enforcement in parallel. The Mainland Judgments (Reciprocal Enforcement) Ordinance (Cap. 645), in force since 29 January 2024, also means that domestic Mainland proceedings running alongside the arbitration may produce judgments registrable in Hong Kong – a risk that claimants need to monitor.

How long does arbitrating a construction or infrastructure dispute in Asia usually take?

The timeline depends on the procedural track chosen and the complexity of the technical claims. Under the HKIAC 2024 Rules, an expedited procedure produces an award within six months of file transfer to the tribunal; this is suitable for disputes where the main issue is one of liability or contract interpretation rather than detailed quantum. Standard proceedings in a major construction dispute – with programme experts, quantum experts, and extensive document disclosure – typically run for two to four years from commencement to award, reflecting the volume and technical complexity of the issues rather than any deficiency in the HKIAC process. Enforcement proceedings add further time that varies by jurisdiction.

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This publication is general information and does not constitute legal advice. For advice on your situation, contact info@lockhartyip.com.

Where arbitrating a construction or infrastructure dispute in Asia stands now