Overview

A recent decision of the Hong Kong Court of First Instance provides some important lessons regarding the drafting of arbitration agreements: Klöckner Pentaplast GmbH & Co KG v Advance Technology.

The Court held that the parties' implied agreement that German law governed the mainland China seated arbitration agreement displaced the general rule that the governing law of an arbitration agreement would follow the law of the seat. Since an arbitration agreement is separable from the underlying contract, it can be governed by a different law.

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