Search for:
Category

Hong Kong

Category

A recent decision of the Hong Kong Court reaffirmed the robust approach taken by the Court in examining the enforceability of a non-compete clause in an employment context even at the interim-interim stage. A former employer has the burden of proof to adduce evidence to substantiate that a non-compete clause is reasonable and necessary for the protection of the former employer’s legitimate business interests for it to be enforceable. The Court will take a very robust approach in examining the scope of the restraint, and the specific basis of justifying a non-compete clause even at the interim-interim stage when a former employer seeks to restrain the ex-employee from joining the new employer competitor by relying on the non-compete clause in the employment agreement.

On 10 April 2024, the Hong Kong Court of Final Appeal (CFA), Hong Kong’s highest court, delivered its judgment in Tam Sze Leung & Ors v Commissioner of Police [2024] HKCFA 8, affirming the validity of the ‘No Consent Regime’ (“Regime”) of the Hong Kong Police (“Police”). The Regime encompassed a practice of issuing “Letters of No Consent” (LNCs) to financial institutions for customer accounts that contain suspected proceeds of crime, thereby triggering informal freezes on these accounts.

Regulatory measures came into force at the end of 2023 to facilitate cross-border transfers of personal data between Guangdong Province (“Guangdong”) and Hong Kong (“GBA Measures”). The recent relaxation of the cross-border data transfer (CBDT) regime at a national level may make the GBA Measures less appealing to some companies in the Chinese Mainland (“China” in this article, for the sake of brevity), but the GBA Measures will still be useful to companies which operate in Hong Kong and Guangdong that need to transfer sensitive personal data or large volumes of personal data across the Greater Bay Area, such as those in the healthcare and financial sectors, or those with a large base of data subjects in Guangdong and a regional office in Hong Kong that conduct cross-border transfers of personal data (e.g., customer data) on a regular basis.

A recent decision of the Hong Kong Court reaffirmed the robust approach taken by the Court in examining the enforceability of a noncompete clause in an employment context. The Court reiterates that it will not redraft a noncompete clause for the parties, nor would it imply a term in order to save a covenant restraining an employee’s post-termination conduct.

On 12 March 2024, the Hong Kong Monetary Authority (HKMA) issued a press release announcing the launch of its new stablecoin issuer sandbox arrangement (“Stablecoin Sandbox”). The Stablecoin Sandbox is another step following the legislative proposal to implement a new regulatory regime for stablecoin issuers. The Stablecoin Sandbox will facilitate communications between the HKMA and interested stablecoin issuers to gauge the expected regulatory standards.

On 8 February 2024, the Financial Services and the Treasury Bureau of Hong Kong (FSTB) released a public consultation (“Consultation”) on legislative proposals to introduce a licensing regime (“Proposed Regime”) for providers of over-the-counter (OTC) trading services of virtual assets (VA). The Proposed Regime will be regulated by the Commissioner of Customs and Excise. The Consultation represents the latest step in the city to further enhance the VA regulatory framework as outlined by the Hong Kong Government in its 2022 Policy Statement on Development of VA in Hong Kong.

On 23 August 2021, the new Inspection Regime (“Inspection Regime”) under the Companies Ordinance (Cap. 622) came into effect. It applies to both Hong Kong-incorporated companies and registered non-Hong Kong companies and has been implemented in three phases. Phase 3 of the new inspection regime will come into effect from 27 December 2023, allowing directors and other relevant individuals to apply to withhold their protected information from public inspection.

On 26 September 2023, The Stock Exchange of Hong Kong Limited published its consultation paper on GEM listing reforms. The proposals have the objective of encouraging and facilitating listings of small and/or medium-sized enterprises on GEM while upholding high standards of investor protection. The consultation period will close on 6 November 2023. Subject to market feedback, the Exchange expects that the rule amendments will come into effect in early 2024.