Search for:

The recent judgment of the Hong Kong Court of Appeal offers greater protection to legal communications and documents created between clients and their lawyers from disclosure in Hong Kong. Such protection arises in situations where a client may be required to produce documents, including regulatory investigations.

Recent developments

On 29 June 2015, the Hong Kong Court of Appeal held in CITIC Pacific Ltd v. Secretary for Justice and Commissioner of Police CACV 7/2012 (“CITIC Appeal”) that legal advice privilege (“LAP”) in Hong Kong applies more widely to communications between company employees and external lawyers, and its application is subject to a “dominant purpose test”. When considering whether LAP applies, the Court of Appeal disagreed with the Court of First Instance which adopted the narrow view of who constitutes a “client” as laid down by the English Court of Appeal in Three Rivers District Council v Governor and Company of the Bank of England (No 5) [2003] QB 1556) (“Three Rivers (No 5)”). The Court of Appeal departs from the Three Rivers (No.5) position and prefers to look at the dominant purpose for which a document is produced, and whether the document or its contents are used for obtaining legal advice.

Implications for corporate clients

The CITIC Appeal clarifies that communications between company employees and external lawyers and documents created for the dominant purpose of obtaining legal advice are protected. It will not be necessary to define a small group of individuals as the “client” – privilege will extend to the whole process of gathering information for the purpose of obtaining legal advice. Clients can thus be more confident when resisting a request for disclosure of documents by law enforcement authorities using their search and seizure powers, whether during a dawn raid or otherwise. In the context of multi-jurisdictional disputes and investigations, the CITIC Appeal reinforces the merits of having a Hong Kong-based engagement so as to rely on the broader application of LAP under Hong Kong law. While this does not completely remove the risk that disputes over the protection of privilege will continue to persist, Hong Kong law provides a potential layer of benefit that may not be available in some other jurisdictions such as England and Wales.

Privilege protection in Hong Kong

In Hong Kong, legal professional privilege (“LPP”) is a right recognized in both statute and common law. It protects the confidentiality of certain types of communications made between clients and their lawyers, and in some circumstances, their communications with third parties. There are two types of LPP in Hong Kong:

  1. LAP protects confidential communications between clients and their lawyers that are made for the purpose of obtaining or giving legal advice. It is not necessary that litigation is pending or contemplated.
  2.  Litigation privilege (“LP”) protects confidential communications between clients and their lawyers, as well as between clients or their lawyers and third parties (such as a factual or expert witness), where such communications came into existence for the dominant purpose of use in connection with actual, pending or contemplated litigation.

As mentioned above, the Court of First Instance adopted the approach of Three Rivers (No 5), that only a group of employees of a corporation tasked with obtaining or receiving legal advice (instead of the organization itself) can properly be deemed to be the “client”. This meant that preparatory communications by and with persons outside this narrow group, for use in seeking legal advice, were excluded from protection, even if intended for submission to or prepared at the request of the organization or its lawyers (including in-house lawyers). The Court of Appeal has widened this approach. The CITIC Appeal recognizes that it is unlikely that a small group of employees within the legal department of a corporation would have all the technical knowledge or skills required to obtain information for and prepare suitable instructions to the corporation’s external lawyers. The Court of Appeal considers that the restrictive definition of client would tend to frustrate the policy of LPP and the proper test is the “dominant purpose test”.

Actions to consider

In light of this latest development, we suggest that clients take the following steps:

  1. Engage external lawyers at the earliest possible moment and carefully define the scope of engagement as this is highly relevant in determining the “dominant purpose”.
  2. Seek legal advice on setting up internal communication protocols when external lawyers are engaged.
  3. Review any existing internal protocols in relation to handling and distribution of communications with external lawyers. Despite the wider application of LAP, it remains good practice to identify who needs to be part of the communication group so as to avoid any waiver of privilege.Seek legal advice as to whether materials sought to be protected are covered by LPP.


The CITIC Appeal is a significant development for Hong Kong on the protection accorded to confidential communications between a client and its lawyers. Although the Court of Appeal has rejected the application of Three Rivers (No 5) in Hong Kong, our view is that the law in this area is not yet settled. We wait to see what the Hong Kong Court of Final Appeal will say about Three Rivers (No 5).


Gary Seib is focused on bringing together global, regional and local teams to deliver commercial success for the Firm’s clients. He passionately believes in simplifying complex legal and business matters. Gary is known for his client-centric approach that drives value and innovation. Gary was described by clients in the Acritas Stars Report as being "knowledgeable, very approachable, friendly." Gary is ranked as a "Star Lawyer," an "Eminent Practitioner" and leading practitioner in his field by top legal directories, including Chambers Asia, Chambers Global, Asia Pacific Legal 500, IFLR 1000, and “PLC Which Lawyer?” He is one of the first lawyers to be granted “Solicitor Advocate” status before the Hong Kong courts and has extensive experience in alternate dispute resolution techniques, particularly in arbitration and mediation. Gary practised as a barrister in Australia for over eight years (1996-2004), and returned to Baker McKenzie as a partner in 2004 to lead its Dispute Resolution Group in Hong Kong and China. Gary also served as the Asia Pacific Chair (2006 - 2009) and Global Chair (2009 - 2014) of the Firm's Dispute Resolution Group, and as Asia Pacific Co-Chair of the Compliance Practice. From 2014-2018 Gary served on the Firm’s Global Executive, including as Chair, Asia Pacific 2016-2018. His leadership covered 17 offices across 12 countries, overseeing more than 3,500 legal and business professionals in the AP region.


Cynthia Tang is the head of the Dispute Resolution Group for the Firm’s Hong Kong and China offices. She has over 25 years of experience in Hong Kong and Asia. Chambers Asia Pacific, PLC Which Lawyer? and Asia Pacific Legal 500 have ranked her as one of the leading lawyers in the Financial Services/Regulatory field for 5 consecutive years. She previously served on a number of committees in the Securities and Futures Commission and is currently appointed by the Hong Kong Government as a Member of the Standing Committee on Company Law Reform and Disciplinary Panel A of the Hong Kong Institute of Certified Public Accountants. She is also a China-Appointed Attesting Officer.


Bryan Ng is a partner in Baker McKenzie's Hong Kong office and a member of the Firm's Dispute Resolution Group. He has written articles and delivered trainings and seminars on topical issues including regulatory enforcement matters. Mr. Ng’s practice focuses on disputes related to financial services, regulatory investigations, commercial disputes, and insolvency-related matters. He advises and represents clients from the financial industry in regulatory investigations and disciplinary proceedings. Mr. Ng also represents clients in arbitration and court proceedings, including shareholders' disputes and judicial review.

Write A Comment