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The Arbitration (Amendment) Bill 2016 introduced Part 11A into the Arbitration Ordinance (Cap. 609) which clarifies the state of affairs with regard to the arbitrability of intellectual property rights (IPR) disputes. The amendment came into force on 1 January 2018 and prior to this there were no explicit stipulations on this point of law. It is now confirmed that IPR disputes are indeed arbitrable under Hong Kong law and that an arbitral award for a dispute of this kind is enforceable.
Section 103D now unequivocally provides that IPR disputes are capable of settlement by arbitration and the wide scope of coverage is designed to facilitate this new regime under Part 11A. Firstly, section 103B which provides for the definition of an IPR is drafted with the intention to encompass all forms of IPRs in arbitration, including not only ten specific types but also “any other IPR of whatever nature”. The definition of IPR disputes that may be arbitrated is similarly defined broadly to include disputes from enforceability and validity to transactional disputes to compensation disputes. In particular, section 103I specifically addresses section 101(2) Patents Ordinance (Cap. 514) which effectively prohibited arbitration proceedings regarding the validity of patents.
A court may set aside or refuse to enforce an arbitral award for public policy reasons, and prior to the amendment it was not clear as to whether they are able to do so simply because a dispute related to IPRs. The amendment cured this ambiguity as sections 103F and 103G respectively clarified that this is not a valid reason on its own to warrant setting aside an arbitral award or a refusal to enforce it.
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