Reading the risk in the reciprocal enforcement of judgments regime with the Mainland

A judgment creditor who wins in Hong Kong and then discovers its debtor's assets sit entirely within the Mainland faces a question that has occupied cross-border practitioners for decades: how does the paper become money? The answer changed materially on 29 January 2024, when the Mainland Judgments in Civil and Commercial Matters (Reciprocal Enforcement) Ordinance – Cap. 645 – came into force and replaced the narrower regime that had operated since 2008. The shift matters not just for parties in active litigation but for any group whose counterparty risk is concentrated across the boundary.

The reciprocal enforcement of judgments regime with the Mainland now operates under Cap. 645, in force since 29 January 2024, enabling registration of effective Mainland civil and commercial judgments – both monetary and non-monetary – with the Court of First Instance in Hong Kong, while Hong Kong judgments travel to the Mainland by certified copy and court certificate. The old requirement that the originating court hold exclusive jurisdiction over the parties is gone, replaced by a connection-based test that broadens eligibility on both sides of the boundary.

This analysis works through the commercial stakes, the governing instruments, the comparative position across the two systems, and our read on where the real risk now sits for foreign principals with exposure to Greater China counterparties.

What is actually at stake: the asset endgame

The litigation victory means almost nothing if enforcement is impossible where the assets are held. For groups trading with, investing alongside, or lending to Mainland counterparties, the asset endgame is almost always north of the boundary. Real property, bank accounts, operating receivables, equity stakes in domestic entities – these assets are governed by Mainland law and sit within the reach of the people's courts, not the Hong Kong courts.

That arithmetic defines the commercial problem. A Hong Kong judgment is a powerful instrument within the jurisdiction. Outside it, the judgment creditor depends entirely on whether a foreign court will give it effect – and on the procedural steps required before it does. Where those steps are uncertain, slow or restricted, the value of the judgment is discounted from the moment it is obtained.

In our cross-border disputes practice, we regularly encounter clients who structured their transactions through Hong Kong precisely for this reason – they wanted common-law courts, clear discovery, and a neutral forum. What they sometimes did not model was the enforcement gap: the distance between a Hong Kong judgment and the assets that actually pay it.

Cap. 645 is the mechanism that bridges that gap. Understanding its scope, its limits, and the sequencing it requires is not a post-judgment task. It is a pre-transaction question.

How the governing instruments work across the boundary

The Mainland Judgments in Civil and Commercial Matters (Reciprocal Enforcement) Ordinance – Cap. 645 – provides the Hong Kong statutory basis for registration of Mainland civil and commercial judgments with the Court of First Instance. On the Mainland side, equivalent rules govern the recognition of Hong Kong judgments by the people's courts. The arrangement is bilateral in structure: each side operates its own domestic implementing rules, aligned by a mutual legal-assistance arrangement between the Mainland and the HKSAR.

Cap. 645 applies to judgments made on or after 29 January 2024. Judgments issued before that date fall to be considered under the earlier regime – now Cap. 597, the 2008 Choice-of-Court regime – which required an exclusive jurisdiction agreement in writing and imposed a narrower set of qualifying conditions. Any creditor holding a pre-2024 judgment will need to assess which regime applies and whether any gap exists in their coverage.

Under Cap. 645, the judgment must be effective – that is, final and enforceable in the originating jurisdiction. The applicant files for registration in Hong Kong with a certified copy of the judgment and a certificate from the originating court. The registered judgment then carries the same force as a Hong Kong judgment for enforcement purposes. The equivalent flow operates in reverse: a Hong Kong judgment creditor seeking enforcement in the Mainland produces a certified copy and court certificate for presentation to the relevant people's court.

The connection test that replaced the old exclusive-jurisdiction requirement is meaningful. It is not unlimited. Certain categories of judgment remain excluded from Cap. 645 entirely: judgments in insolvency proceedings, certain intellectual-property and patent matters, certain arbitration-related judgments, succession matters, and matrimonial matters. A creditor holding a judgment that touches any of these excluded categories will need a different route – or may find none available under the regime at all.

The sequence above describes the standard 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 discuss how Cap. 645 applies to your cross-border position, contact info@lockhartyip.com.

The comparative read: how the two systems meet

Hong Kong operates as a common-law jurisdiction. Binding precedent, adversarial procedure, and an independent judiciary operating in both English and Chinese sit at its centre. The Court of First Instance is the relevant first-instance tribunal for registration applications under Cap. 645, and its judgments carry the authority of the common-law system with appeal to the Court of Appeal and ultimately the Court of Final Appeal.

The Mainland court system operates within a civil-law tradition. Judgments of the people's courts at various levels carry different weight; the enforceability of a judgment within the Mainland depends partly on the level of the court that issued it and the procedural route by which finality was achieved. A judgment that is final and enforceable in the Mainland sense may look different from the finality concept a common-law practitioner applies when assessing whether it qualifies under Cap. 645.

This interface point is one of the areas where the risk concentrates. Foreign counsel advising a group on a Mainland-counterparty transaction will often default to the common-law understanding of "final judgment". The Mainland concept – where internal review procedures remain technically available for certain periods – does not always map cleanly onto the common-law equivalent. A creditor who believes its Mainland judgment is final and registrable may find the application resisted on this ground.

The question of what courts on the Mainland side will accept when a Hong Kong judgment arrives is equally material. The people's courts apply their own conditions for recognising foreign-court judgments; the arrangement with Hong Kong sets out agreed conditions, but the practical application in any given court location is a separate variable. Experience in our cross-border practice indicates that the quality of the Hong Kong judgment documentation – its form, its translation, and its certification – frequently determines how smoothly a Mainland recognition application progresses.

There is also a timing dimension that is easy to underestimate. Cap. 645 does not create an automatic fast track. Registration is a court process in both directions, and Mainland recognition applications run through the people's courts on their own procedural timetables. A creditor pursuing assets across both sides of the boundary simultaneously will face overlapping processes that do not synchronise by default.

What changed when Cap. 645 replaced the 2008 regime – and what did not

The most commercially significant change in Cap. 645 is the removal of the exclusive-jurisdiction requirement. Under Cap. 597 – the 2008 regime – a judgment was only eligible for recognition if it had been issued by a court that had been designated by the parties as having exclusive jurisdiction in a written agreement. In practice, this confined the regime to transactions where the parties had expressly chosen the Hong Kong courts or the Mainland courts in advance, and where the clause was correctly drafted.

That requirement excluded a large volume of commercial judgments. Many commercial contracts – particularly those where jurisdiction had been addressed loosely, or where one party had commenced proceedings in a court of general competence rather than a designated court – fell outside the 2008 regime entirely. Those creditors had no formal reciprocal-enforcement route and were left to rely on the courts' general discretion to recognise foreign judgments at common law, a slower and less certain process.

Cap. 645 replaces exclusive jurisdiction with a connection-based test. The originating court must have a sufficient connection to the matter – based on domicile, habitual residence, place of business, or agreement (not necessarily exclusive) – but the requirement for strict exclusivity is gone. This is a material expansion of the regime's reach for any creditor holding a judgment from proceedings that were competently instituted but not expressly designated in advance.

What did not change is the exclusion list. The categories of judgment outside the regime remained broadly intact. Insolvency, certain IP matters, arbitration-related orders, succession, and matrimonial matters are still excluded. For practitioners advising groups with complex holding structures, the interaction between the regime and insolvency proceedings is particularly relevant: a creditor seeking to enforce against a Mainland entity that has entered any form of domestic insolvency procedure will face a different analytical framework.

The 2024 rules also clarified the treatment of non-monetary judgments. Under Cap. 597, the focus was predominantly on money judgments. Cap. 645 expressly extends to non-monetary relief – specific performance, injunctions, declaratory orders – which widens the potential application for commercial groups seeking structural remedies rather than just payment.

Where the risk actually sits now: our assessment

The expansion of Cap. 645 is a genuine improvement for creditors with Mainland exposure. Fewer transactions will fall outside the regime on the jurisdiction-clause ground. Non-monetary relief has a clearer pathway. The documentation requirements are more settled. These are real gains.

The risks that remain are procedural, structural, and temporal. They cluster around four pressure points.

First, the exclusion list. Practitioners who rely on the regime's general scope without checking the exclusion categories expose their clients to failed registration applications and the wasted cost of proceedings that were never going to succeed under Cap. 645. The interaction between the regime and insolvency is the highest-risk exclusion: a Mainland counterparty in financial distress will often enter a form of proceedings that takes the matter outside the regime precisely when enforcement is most needed.

Second, the finality question. The concept of a "final and effective" judgment is not uniformly applied across the two systems. Where any residual review mechanism remains open – whether or not it is realistically likely to be exercised – the registrability of the judgment may be contested. Creditors should obtain a clear opinion on the finality status of their Mainland judgment before commencing registration proceedings in Hong Kong, and vice versa.

Third, the documentation chain. Both registration in Hong Kong under Cap. 645 and recognition in the Mainland under the reciprocal arrangement require certified copies and court certificates. The quality of translation, the precision of certification, and the currency of the documents at the time of filing matter in practice. Applications that fail on documentation grounds are not uncommon in our cross-border practice, and they cause delays that a debtor's asset-disposal activity can exploit.

Fourth, the concurrency problem. A judgment creditor with assets on both sides of the boundary may want to move in both jurisdictions simultaneously. Nothing in Cap. 645 prohibits parallel proceedings. But the practical management of two concurrent court processes – different procedural timelines, different document sets, different standards for "effectiveness" – requires a co-ordinated strategy rather than two independent filings. If an earlier filing, structure or enforcement attempt has produced a stalled result, a second read can identify the strategic error and the routes still open.

For a structured assessment of your enforcement position across the Mainland–Hong Kong boundary, write to us at info@lockhartyip.com.

How this interfaces with the arbitration route

Any analysis of judgment enforcement between Hong Kong and the Mainland must address the parallel track: arbitration. Hong Kong-seated arbitral awards have their own mutual-enforcement architecture. The 1999 Arrangement between the Mainland and the HKSAR on mutual enforcement of arbitral awards, supplemented in 2020, governs cross-boundary award recognition independently of Cap. 645. Since the 2021 amendment to the Supplemental Arrangement, simultaneous enforcement applications in both jurisdictions are permitted.

The Mainland interim-measures Arrangement, in effect since 1 October 2019, allows parties to Hong Kong-seated arbitrations to seek interim measures from Mainland courts before or during proceedings. This is a significant tool: it allows a claimant to freeze assets across the boundary before an award is obtained, a step that was not available under the earlier regime.

For groups designing their transaction documents, the choice between a court-jurisdiction clause and an arbitration clause is therefore not just a forum question. It is an enforcement question. Court judgments travel under Cap. 645. Arbitral awards travel under the Arrangements. The two routes differ in their scope, their procedural requirements, and their interaction with the exclusion categories. A transaction that falls within an excluded category for Cap. 645 may still be arbitrable, and the award may be enforceable under the Arrangements – or may face its own restrictions depending on the subject matter.

We regularly advise clients at the transaction stage on which combination of clause, seat, and governing law produces the strongest enforcement position against a Mainland counterparty. The analysis is not the same for every sector, every asset profile, or every debtor profile. Getting it right before the contract is signed costs a fraction of the remediation required after a judgment proves difficult to register.

For further context on arbitral-award enforcement across a different cross-border pair, see our analysis of enforcing a Hong Kong arbitral award in the United Kingdom, which covers some of the structural principles that apply across enforcement routes generally.

Two fact patterns: where the route holds and where it does not

A European manufacturing group with a Hong Kong operating subsidiary obtained a Hong Kong Court of First Instance judgment against a Mainland distributor in late 2024. The claim arose from a distribution agreement governed by Hong Kong law, with a non-exclusive Hong Kong jurisdiction clause. Under the old Cap. 597 regime, the non-exclusive clause would have been fatal to registration. Under Cap. 645 – and its connection-based test – the same judgment was eligible for registration. The group applied for registration in Hong Kong while simultaneously instructing allied counsel in the Mainland to prepare the recognition application. The certified documentation was prepared in a single co-ordinated exercise. The enforcement proceeded on both fronts within a manageable timeframe.

A different outcome in an autumn 2025 matter illustrates the exclusion-list risk. A group holding a Hong Kong judgment arising from a dispute over a receivership-related payment sought registration under Cap. 645. The judgment creditor had proceeded on the assumption that a money judgment was straightforwardly registrable. In fact, the subject matter of the proceedings engaged the insolvency exclusion – the payment claim was sufficiently connected to the receivership proceedings to take it outside the regime. The registration application failed at first instance. The group was redirected to the common-law recognition route, which involved a more extended process and a different evidentiary standard. The costs of the failed application, and the time lost, were material.

These two patterns reflect the central analytical point. The regime is more accessible than its predecessor. But it is not automatic, and the exclusion categories are not always obvious from the face of the underlying transaction. The risk assessment belongs at the structuring stage, not the enforcement stage.

The objection this regime is often misread against

A common assumption among foreign principals approaching cross-border enforcement for the first time is that a Hong Kong judgment – obtained before one of the most commercially credible common-law courts in Asia – will be readily recognised anywhere in Greater China. The assumption has a certain logic: the common-law system is respected, the courts are independent, and the judgment is issued in English or Chinese with full procedural formality.

The assumption is wrong in a specific and important way. Recognition and enforcement of a Hong Kong judgment in the Mainland is not automatic, regardless of the quality of the judgment or the reputation of the issuing court. It is a court process in the Mainland, governed by the terms of the mutual arrangement and the Mainland's own procedural rules. The people's courts will examine the application on its merits: the connection test, the documentation, the finality, the exclusion categories.

What the quality of the Hong Kong court system does provide is a strong foundation for the recognition application. A well-reasoned, clearly documented Hong Kong judgment, certified correctly and accompanied by accurate translation, is the best possible input into a Mainland recognition proceeding. But the quality of that input does not guarantee the outcome – it improves the probability and reduces the grounds for resistance.

The practical implication is that creditors should treat the Mainland recognition process as a litigation event in its own right, not an administrative formality that follows automatically from winning in Hong Kong. It requires legal representation before the people's courts, knowledge of local procedural requirements, and – in our experience – active case management from the moment the Hong Kong judgment is obtained.

For clients managing debt-recovery processes across a different offshore corridor, our guide to debt recovery and enforcement against a Singapore debtor sets out some comparative principles on cross-border enforcement that translate across corridors.

Decision matrix: which route, which timing, which risk

Situation A: the contract contains a non-exclusive Hong Kong jurisdiction clause; the debtor's assets are in the Mainland; the judgment post-dates 29 January 2024. Route: Cap. 645 registration in Hong Kong, then Mainland recognition application under the bilateral arrangement. Timing: court-driven in both jurisdictions; no fixed statutory timetable. Risk: finality challenge; documentation quality; concurrent process management.

Situation B: the contract contains an arbitration clause designating Hong Kong as seat; the debtor's assets straddle both sides of the boundary. Route: HKIAC arbitration; interim-measures application to Mainland courts under the 2019 Arrangement (before award); enforcement of award under the 1999/2020 Arrangement. Timing: interim-measures application available from the date of commencement; award enforcement after issue. Risk: exclusions under the Arrangements; interim-measures conditions; simultaneous-filing co-ordination.

Situation C: the judgment predates 29 January 2024 and arose from proceedings without an exclusive jurisdiction clause. Route: Cap. 645 does not apply; Cap. 597 does not apply (no exclusive clause); common-law recognition application only. Timing: more extended; standard court procedures without a dedicated statutory mechanism. Risk: higher discretionary threshold; uncertain outcome; asset dissipation during proceedings.

Situation D: the judgment arises from proceedings connected to insolvency. Route: Cap. 645 expressly excludes it; common-law recognition and insolvency co-operation regime considerations apply instead. Timing and risk: fact-specific; requires dedicated analysis before any application is commenced.

The matrix is not exhaustive. Every cross-border enforcement file carries its own configuration of jurisdictions, assets, and procedural history. The matrix identifies the entry point; the file determines the route.

Our disputes and arbitration practice is available to assess the full position, including matters that have already stalled or produced an adverse interlocutory result. To map your enforcement options across the Mainland–Hong Kong interface, write to us at info@lockhartyip.com.

For a full overview of the practice, see our Disputes & Arbitration practice page.

Related practices

• Holding Structures – structuring cross-border entities to optimise the enforcement and exit position
• M&A & Transactions – transaction documents, governing law, and jurisdiction clauses for Greater China deals

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