14th November, 2013
Dear Friends and Colleagues,
Limited Liability Partnership
With the passage of the Legal Practitioners (Amendment) Bill 2012 on 12 July 2012, Hong Kong took a constructive step towards finally allowing solicitors to practice in the form of limited liability partnerships. Now, there are just a few more details that have to be implemented before a commencement date of the Ordinance can be appointed.
In particular, on the issue of professional insurance, the understanding when the law was passed was that the insurance requirement for a LLP would have to be more stringent than that for a “normal” partnership, but the exact scheme still has to be determined and then put into the form of a subsidiary legislation. My understanding is that the Law Society Council has recently decided on adopting the recommendation of the Working Party on LLPs that LLP be allowed to obtain their own top-up cover with terms similar to those provided by the Professional Indemnity Fund, and a law firm has since been engaged to take up the task of drafting the necessary subsidiary legislation. I have urged the Law Society to speed up the process.
It is with sincere hope that the proposed subsidiary legislation will be sent to the Legislative Council for vetting in time for the commencement date to be appointed before the end of this legislative year in July 2014. When it does arrive at LegCo, I will most likely be chairing the Bills subcommittee.
Party and Party Rates
This is another issue which I have been working on by putting the appropriate pressure on the Judiciary to conduct a review of the current rates; which are seriously out of sync with market realities.
The Chief Justice has recently agreed to appoint a working group to review the matter and to make recommendations. Whilst this is a positive step, I am worried that the process would simply take far too long to complete, and at the same time successful litigants would continue to lose out. I believe that an immediate update of the rates is necessary and justified, together with a study on how to implement a periodic review mechanism going forward.
I shall keep you posted.
Dennis W.H Kwok