SFKS is pleased to announce a successful outcome for our client before the Court of Appeal in Choi Wan Sheung Nancy v Choi Si Ming Danny and Another [2026] HKCA 997. On 12 June 2026, the Court of Appeal dismissed the Defendant’s appeal and upheld the judgment of the Court of First Instance in favour of our client, the First Plaintiff therein.
The dispute arose from the administration of the estate of the parties’ late mother and concerned, among other matters, the Defendant’s sale of an estate property in Hung Hom (the “HH Property”) and the beneficial ownership of a property in Causeway Bay (the “CWB Property”). The Defendant, who was the executor of the estate, contended that he had acquired our client’s and other beneficiaries’ interests in the estate and that our client held her interest in the CWB Property on trust for him.
At first instance, the Court of First Instance rejected the Defendant’s claims. The Court found that the Defendant had breached his duties as executor by selling the HH Property at an undervalue and ordered him to compensate our client for her one-fifth share of the difference between the sale price and the market value. The Court also declared that the beneficial interests in the CWB Property should be apportioned by reference to the parties’ respective financial contributions, with our client entitled to a 72.2105% beneficial interest.
On appeal, the Court of Appeal accepted our client’s position and dismissed the Defendant’s appeal. The Court held that there was no proper basis to interfere with the trial judge’s findings of fact and credibility, and that the Court of First Instance was entitled to reject the Defendant’s case on the alleged acquisition of the our client’s and other beneficiaries’ interests and his claim to sole beneficial ownership of the CWB Property. The Court of Appeal further awarded our client the costs of the appeal.
This result is a welcome affirmation of our client’s rights following a long-running family and estate dispute. It also demonstrates SFKS’s experience in handling contentious probate, trust, property and appellate disputes, including cases involving executor duties, beneficial ownership and complex factual challenges.
This case serves as a timely reminder to litigants aggrieved by a first-instance decision: an appeal is not a retrial, nor does it provide another open avenue to easily disturb a trial judge’s findings of fact. As cited by Mr Justice Anderson Chow, a first instance trial on the merits should be “the main event”, rather than a “tryout on the road”. An appellate court will accord substantial deference to a trial judge’s findings of fact and credibility assessments given their unique “heard and seen” advantage and holistic familiarity with the case, something which an appellate court lacks. Trying to do otherwise would be a waste of judicial resources.
This case was led by our Consultant Mr. Tommy Tam and our Partner Ms. Jenny Wong and assisted by our Associates Ms. Koey Wong and Mr. Tommy Lam. SFKS also take this opportunity to thank Counsel Stoney Chan for his thorough and able assistance throughout.
Full judgment can be found at legalref.judiciary.hk/lrs/common/ju/ju_frame.jsp?DIS=181798&currpage=T.
SFKS collaborated with a law firm in US in the recent success in resolving an intellectual property claim concerning a multinational corporate.
The dispute involves the multinational corporate suing, amongst others, a former key person at its Hong Kong office for allegedly infringing copyrights and divulging trade secrets. As the underlying agreement is governed by Delaware law, we assisted our client in instructing Delaware lawyer within our International Lawyers Network (ILN), and provided legal support to the Delaware lawyer in acting in the US proceedings, providing advice and engaging in out-of-court negotiations, as well as close attendance throughout.
SFKS has a long history of strength and experience in contentious and non-contentious intellectual property practice. Back in 1997, SFKS filed Hong Kong’s first registered design, first short-term patent, and first standard patent applications. SFKS advises on initial strategising, branding, drafting, filing, prosecution, opposition and revocation of intellectual property rights. As an all-service law firm, and blending our intellectual property practice and dispute resolution expertise, SFKS is well-positioned to assist in IP disputes as well.
IP disputes are often cross-jurisdictional in nature. SFKS, being a member of the International Lawyers Network (ILN), a global association of 91 high-quality, independent law firms representing more than 5,000 lawyers worldwide, facilitates expedient and frictionless access to top-tier specialist counsel worldwide and ensures comprehensive and seamless legal support to cross-jurisdictional affairs.
SFKS is delighted to welcome a delegation of mainland lawyers, including Ms. Zhou Lixia, Mr. Liu Wei, Mr. Cen Zhibin, and Mr. Zeng Decai. The mainland team engaged in deep and meaningful exchanges with our firm’s legal team across various practice areas, including cross-border matters, trusts, corporate governance, and dispute resolution.
Introduction
In some jurisdictions, a married person entering into a share transaction may be asked to do something relatively uncommon in Hong Kong: provide a signed consent from his/her spouse. In certain jurisdictions such as the Chinese Mainland and some community property states in the United States, certain assets acquired before and/or during marriage may be regarded as community properties jointly owned by the couple. If an individual acquires or sells shares and his/her spouse later asserts a claim to them, say upon divorce, ownership disputes will arise. To mitigate such risks, some jurisdictions have developed the practice of requesting the spouse of the vendor to provide written consent to the transaction and waive any interest in the shares.
Does this practice have any place in Hong Kong? This article examines that question in the context of sale and purchase of shares of a company incorporated in Hong Kong.
What is the Matrimonial Property Regime in Hong Kong?
Separation of property
Hong Kong essentially has a separate property regime. Under section 4(1) of the Married Persons Status Ordinance (Cap. 182) (MPSO), all property belonging to a married woman at the time of her marriage, or acquired by her afterwards, shall belong to her in all respects as if she were unmarried and may be disposed of accordingly. This abolished the common law doctrine of coverture, under which a married woman’s legal identity would merge with that of her husband and the husband would acquire all property belonging to her at the time of the marriage or acquired by her during the marriage. Accordingly, in Hong Kong, each spouse owns and is free to dispose of his/her property, whether acquired before or during the marriage.
Division of assets on divorce
It is when a marriage breaks down that the question of division of assets arises. In divorce proceedings, the court first determines the assets available in the matrimonial pot and then decides how to divide them between the spouses to achieve fairness. It is empowered to make, among others, property adjustment orders for the transfer of properties (such as shares) from one party to the other. The spouses may have signed a pre‑ or post-nuptial agreement regarding how they wish to divide their properties upon divorce. Such agreement will be given appropriate weight by the court with regard to all the circumstances of the case but is not legally binding.
Is Spousal Consent Legally Required for a Valid Share Transfer?
As mentioned above, a married person can hold properties, including cash and shares, as his/her own assets and deal with them independently. Therefore, neither the vendor nor the purchaser needs their spouse’s consent for the share transfer to be legally valid. If, however, the vendor’s spouse has a beneficial interest in the shares (for example, because the vendor holds the shares as a nominee/trustee for the spouse), the solution is not to obtain any spousal consent, but to make the beneficial owner one of the parties to the transaction and the relevant transaction documents.
Can a Party’s Divorce Unravel a Completed (or Pending) Transaction?
Despite the separate property regime, a divorce can technically cast a shadow over an M&A transaction already closed or about to close. This is because of section 17 of the Matrimonial Proceedings and Property Ordinance (Cap. 192) (MPPO), which empowers the court to avoid asset transfers by a spouse that are intended to frustrate potential matrimonial claims of the other spouse.
How section 17 of the MPPO works
If a party to the marriage has made, or is about to make, a disposition of property (such as a transfer of shares or payment of purchase price) with the intention of defeating the other party’s claim for financial provision, the court may make orders to set aside the disposition made or restrain the disposition from taking place. If the disposition (i) took place less than 3 years before the section 17 application or (ii) is about to take place, then so long as the court is satisfied that it has defeated or would defeat the other party’s claim for financial provision, an intention to defeat the claim is presumed.
Risk is remote in normal circumstances
While theoretically speaking every share sale and purchase can be subject to challenge under the MPPO upon the counterparty’s divorce, the risk of it being set aside should be rather remote for most arm’s-length transactions:
When Should Spousal Consent be Considered?
When the alarm bells ring
There are, however, circumstances which might put a party to the transaction on enquiry. For example:
In such situations, legal advice should be obtained on whether to request a spousal consent or waiver from the counterparty before entering into the transaction.
What spousal consent can and cannot do
A signed consent or waiver given by the counterparty’s spouse is unlikely to oust the jurisdiction of the family court or completely prevent the spouse from challenging the transaction under section 17 of the MPPO. Nonetheless, evidence that the transaction was entered into with the spouse’s consent may make it significantly more difficult for the spouse to argue later that the transaction was intended to defeat financial provision claims. In the case of a resulting trust claim, it may also help establish the purchaser’s status as a bona fide purchaser for value without notice, strengthening the “equity’s darling” defence.
Standard protections in M&A deals
Situations warranting a request for spousal consent are expected to be relatively rare. It is not standard practice in Hong Kong to make such a request for every M&A transaction. In the absence of red flags such as those mentioned above, asking a counterparty to provide – and have their spouse sign – a document that contemplates marital breakdown and division of assets between them may be seen as unreasonable and even offensive.
For a purchaser, apart from conducting the necessary legal due diligence, the standard protection is to request customary warranties and indemnities in relation to the vendor’s good title to the shares, free from any third‑party interests. The purchaser can bring a claim for a breach of warranty and/or seek indemnities from the vendor.
For a vendor concerned about the purchaser’s ability to pay, the common solution is to request a guarantee from a person or entity of sufficient financial standing, or a security over other assets.
Does it Make any Difference if the Counterparty has a Matrimonial Domicile in Another Jurisdiction?
Hong Kong follows the lex situs rule for the creation and transfer of property: in general, the validity and effect of a transaction are governed by the law of the place in which the target property is sited. For shares in a Hong Kong company, their transfer should be governed by Hong Kong law and should follow the formalities under Hong Kong law, which does not require any spousal consent of the parties.
However, where a counterparty does not have any or sufficient connections with Hong Kong, that may give rise to other considerations. For example, if the counterparty later breaches the sale and purchase agreement but has no other assets in Hong Kong and has not provided any security, the innocent party may need or choose to enforce a Hong Kong judgment against the counterparty’s foreign assets. It is uncertain whether (and if so, the extent to which) this can be done if the counterparty’s spouse has an interest in those foreign assets under the foreign matrimonial property regime. In such cases, legal advice should be obtained in Hong Kong and the relevant jurisdiction. Therefore, in case there is any serious doubt as to the counterparty’s ability to fulfill its contractual obligations or satisfy a Hong Kong judgment in case of any breach, a party may consider the necessity of other solutions, such as obtaining a guarantee, security or perhaps the counterparty’s prior spousal consent to enforcement against foreign assets in the first place.
Conclusion
While it may be the practice in some jurisdictions to request the counterparty’s spousal consent for a commercial transaction, it is not normally required and adopted for a Hong Kong M&A deal. In certain circumstances, however, such as where a share transaction is to be made at a substantial undervalue or the counterparty’s spouse is known to have contributed to the acquisition of the target company with his/her funds or to the improvement of its value as outlined above, legal advice should be obtained to mitigate the legal risks.
Disclaimer :
This material is provided for general information only. It does not constitute legal or other professional advice nor constitute any lawyer-client relationship between Sit, Fung, Kwong & Shum and any user or browser. No liabilities are assumed arising from any reliance on the information in this material.
Sit, Fung, Kwong & Shum is a Hong Kong law firm and does not practice or provide legal advice on the laws of other jurisdictions. References to the laws and practice of any other jurisdictions in this material are provided for general reference and comparative purposes only, and do not constitute any advice, opinion or representation on the law or practice in those jurisdictions.
Background
A decade ago, during my time as a biomedical engineering student at Imperial College London, Hong Kong’s strategic priorities were largely centered on finance and real estate development, with comparatively limited emphasis on innovation and technology-driven growth. In recent years, however, fostering innovation and technology has become one of Hong Kong’s key priorities. In my view, Hong Kong has strong potential to develop into one of the leading biotech hubs by leveraging its strategic position within the Greater Bay Area (“GBA”), its role as an international financial centre and its well-established, internationally respected legal system.
A key development strategy for Hong Kong is South-North dual engine (「南金融、北創科」), with the financial services continuing to develop at the Harbour Metropolis, whereas the new engine for innovation and technology will be positioned at the Northern Metropolis. The Hong Kong government is committed to accelerate the development of the Northern Metropolis which includes, among others, building new railway lines to improve connectivity to and from the area, developing the San Tin Technopole, and engaging major corporations—such as pharmaceutical companies—to establish a presence in the Northern Metropolis. The Northern Metropolis is built to attract global talents and enterprises while also cultivating local talent for the future.
What is Biotech?
“Biotech” is an abbreviation of biotechnology, meaning the manipulation of biological process, systems or living organisms to develop products that can improve human lives. However, the term “biotech” is often used to denote more than merely biotechnology but represents a much broader concept – biomedical engineering, a broad discipline that apply interdisciplinary engineering principles to improve health and function of patients through developing diagnostic, therapeutic and rehabilitative products.
Highly cross-discipline in nature
Biomedical engineering is a highly interdisciplinary and heavily regulated industry with a long, complex development pipeline that extends well beyond laboratory research. Companies must navigate scientific challenges, clinical trials, patent protection, regulatory approvals, and sustained fundraising, often operating for years without revenue. Due to high risks and low success rates, professional investors remain cautious by conducting rigorous due diligence and limiting their investment to those areas where they possess technical expertise.
Legal professionals’ roles
Legal professionals are integral to biotech companies at many stages of their development, providing guidance on intellectual property protection, regulatory and approval matters, commercial transactions, corporate structuring, capital raising, IPOs, M&A, and dispute resolution. In light of the sector’s scientific complexity, stringent regulatory environment, lengthy development cycles, and significant investment risks, lawyers play a crucial role in mitigating legal exposure while facilitating strategic expansion and successful commercialisation.
Chapter 18A of the HKEX Main Board Listing Rules
Chapter 18A of the HKEX Main Board Listing Rules sets out alternative set of listing requirements for biotech companies, waiving the traditional minimum revenue requirement. Since the introduction of Chapter 18A in 2018, pre-revenue biotech companies have been able to list in Hong Kong, subject to the satisfaction of all the relevant rules or wavier of such requirements. According to the website of the HKEX, 80 companies have listed via Chapter 18A as of end-November 2025. The significance of Chapter 18A is to provide another method for the biotech companies to raise fund besides governmental grant, private equity sale and debt. Most importantly, the Chapter 18A listing route is friendly to pre-revenue biotech companies.
It is noted that “biotech” is defined broadly under Chapter 18A to allow a wide range of biomedical engineering enterprises to be listed in Hong Kong. It is set out in paragraphs 3.3 and 3.4 of the Guidance Letter (HKEX-GL92-18) and Chapter 18A that the HKEX will consider the listing application of a biotech company which sufficiently demonstrate it has developed a biotech product beyond concept stage and such biotech product must fall within one of the four categories: (1) Pharmaceutical (small molecule drugs), (2) Biologics, (3) Medical devices (including diagnostics) and (4) “Other Biotech Products” at the discretion of the HKEX. For more information, please refer to Chapter 18A of the HKEX Main Board Listing Rules and Guidance Letter (HKEX-GL92-18) and seek professional advice.
Medical Data Sharing
Data plays a critical role in the development of biotech industry. The success of biotech products largely depends on clinical trial results, which are basically large-scale statistical analysis on safety and efficacy. Early access to extensive data helps researchers better predict outcomes, allocate resources more effectively, and avoid costly late-stage failures.
In Hong Kong, initiatives such as the Hospital Authority’s Data Sharing Portal provide clinical data from over 40 public hospitals for academic research, subject to approval and strict privacy safeguards.The Hong Kong government also launched the Electronic Health Record Sharing System (eHealth) in 2016, a consent-based platform enabling secure sharing of encrypted patient records between authorized public and private healthcare providers. On 24 December 2025, the Health Bureau expanded the “Cross-boundary Health Record” function of the eHealth app to all approximately 6.3 million users, allowing eligible records to be shared with designated medical institutions in mainland China and enabling cross-border deposit and access of medical records for follow-up care.
The above demonstrates that the Hong Kong government is actively promoting the digitalisation of medical records, which could play a crucial role in advancing the R&D of biotech products. In Hong Kong, the collection, handling and use of personal data is subject to the Personal Data (Privacy) Ordinance (Cap. 486).
The Hong Kong Centre for the Medical Products Regulation (“CMPR”)
On 26 June 2025, the Department of Health announced that the CMPR will be established by the end of 2026 and that the Department of Health will implement primary evaluation for new drug registration in phrases starting from 2026, with full implementation by 2030. The vision of the CMPR is to become a "leading, internationally renowned medical products regulatory authority” which promotes innovation, and R&D of drugs and devices by optimising medical products regulation.
Primary evaluation will be implemented in phrases in the period from between 2026 to 2030 with the scope expanding each year:
The importance of the CMPR is to establish a local regulatory authority in Hong Kong to complete a comprehensive life-cycle of medical products – R&D, funding, regulatory approval, commercialisation across Hong Kong and the GBA.
Conclusion:
Biotech is a high-risk, capital-intensive industry, but successful biotech products can deliver significant health benefits, strong patent-protected profits, and wide-ranging economic gains through job creation across the value chain. Hong Kong's robust financial and legal systems, combined with its strategic location in the GBA, position it perfectly to become a world-class biotech hub. Hong Kong legal professionals will play increasingly important roles in supporting biotech companies throughout their entire lifecycle, and backing Hong Kong to become a leading hub for capital market, regulation and dispute resolution for the biotech industry.
Disclaimer: This material is provided for general information only. It does not constitute legal or other professional advice nor constitute any lawyer-client relationship between Sit, Fung, Kwong & Shum and any user or browser. No liabilities are assumed arising from any reliance of information in this material.
Introduction
In an attempt to modernize the position of trust law in Hong Kong, consultations regarding amendments to the Trustee Ordinance (Chapter 29 of the Laws of Hong Kong) (the “Ordinance”) were made in 2009 and 2012 respectively. Such amendments finally came into effect on 1 December 2013. Different amendments were made, including, among others, the enactment of Section 41X of the Ordinance in relation to the reservation of powers by the settlor in investment or asset management functions under the trust. This provision provides, among other things, the following:
“(1) A trust is not invalid only because of the person creating the trust (the settlor) reserving to the settlor any or all powers of investment or asset management functions under the trust.
(2) If a power or function referred to in subsection (1) has been reserved by the settlor, a trustee who acts in accordance with the exercise of the power or function is not in breach of the trust.”
Section 41X only deals with the reservation of power (“Reserve Power”) by the settlor in investment or asset management functions, and no other powers or persons are provided for in the provision. While the legislative intent has made it clear that the amendment is only to put it beyond doubt that a trust would not be invalidated because of the mere fact that the settlor has reserved the settlor’s power of investment or asset management functions, questions have arisen as to whether only the settlor is allowed to reserve them?
Delegation of Reserve Power by Settlor
Position as to Trustee:
For trustees, at common law, the fundamental rule was that a trustee could not delegate a power given to him if the power reposed a personal trust and confidence in him. However, the Ordinance now expressly provides for the power of appointment of agents and the delegation of functions by a trustee. Under Section 41B of the Ordinance, the trustee may delegate to another person as his agent certain functions other than the distribution of assets, the decision on payment out of income or capital, the appointment of trustees and the power of delegation. A trustee still cannot delegate the fundamental duties and functions which should be exercised at its discretion.
Position as to Settlor:
There is no equivalent provision for the Reserve Power of the settlor. Unlike the trustee, traditionally the settlor should have dropped out of the picture when the trust is properly constituted, there is nothing which must be reserved at the discretion and control of the settlor in order for the settlor to fulfil any duty under the law, and there is no power which the settlor has to delegate in general. Accordingly, the delegation of power by a settlor (as opposed to a trustee) is not a common feature and may not be necessary in a trust.
Unlike trustees who are in the position of trust and confidence, the settlor may not have such onerous duties. Where the Reserve Power of the settlors is merely a personal right, the settlors should be able to exercise such power at their own discretion for their own benefits. We submit a settlor may delegate the exercise of power to others as it will not affect any fulfilment of duties owed to the beneficiaries. Moreover, if Section 41B of the Ordinance has specifically allowed the trustees to authorize a person to exercise one or more of their delegable functions as their agent, the settlors, who do not owe any onerous duty to the beneficiaries in general, should be subject to a lesser degree of control and they should also be able to delegate their Reserve Power as they deem necessary or desirable.
Structuring the Reserve Power and Delegation Framework:
As part of the arrangement of a trust, the Reserve Power should be expressly specified in the trust deed, which is the basic document constituting the trust. The reservation of power may also be contained in some other documents and the trustee may give effect to these documents, such as a letter of wishes, but such documents may not be legally binding themselves. Alternatively, as can be seen from the case of Zhang Hong Li v DBS Bank (Hong Kong) Limited [2019] HKCU 4372, where the Reserve Power was made by appointing a settlor as the investment advisor to the private investment company of the trust and allowing her to make the decisions, the trust arrangement may also be designed in a way that a settlor will have effective control of investment and asset management functions.
If the settlor of a trust also desires to delegate the Reserve Power, such power of delegation should also be specified in a trust instrument in order to provide for clarity. If the trustees can delegate their power through other documents, such as a management agreement, we submit settlors should also be able to delegate the Reserve Power through other documents. Since the settlors are in general able to exercise Reserve Power for their own benefits, they will naturally be able to delegate the power without being subject to constraints.
Delegation of Reserve Power of the Settlor in case of Disability
Will an Enduring Power of Attorney (“EPOA”) help in case the settlor is mentally disabled:
An EPOA enables an individual (the donor) to appoint a trusted person (the attorney) to manage their property and financial affairs should they become mentally incapacitated, thereby providing a straightforward and cost-effective way of managing property and financial affairs. Unlike a conventional power of attorney, which becomes invalid if the donor loses mental capacity, an EPOA "survives" through that transition, provided it is executed according to prescribed statutory requirements while the donor is still of sound mind and is registered. The EPOA respects the donors’ autonomy by allowing them to choose who will act on their behalf, ensures a smooth transition in the management of their affairs, and helps avoid the distress, delay, and expense associated with court applications. However, the EPOA is limited to property and financial matters, and does not extend to decisions such as those about personal care or medical treatment.
Under Section 8(1) of the Enduring Powers of Attorney Ordinance (Chapter 501 of the Laws of Hong Kong) (“EPOAO”), the EPOA only empowers the attorney to deal with the property and financial affairs of the power donor, as opposed to the health and welfare and other matters, of the donor. Clear definitions of “property” and “financial affairs” are not provided in the EPOAO. The attorney may administer and apply the property of the donor to maintain the donor and other people for whom the donor might be expected to provide for or meet their needs. However, an EPOA which attempts to confer upon the attorney wider powers and authority than permitted in the EPOAO may be considered invalid.
Effects on Reserve Power:
Since once a trust is properly constituted, the settlor of the trust ceases to have any legal or beneficial interest in the trust property, unless the settlor is also one of the beneficiaries. In the situation where the settlor has reserved only investment and asset management functions and has no other interest in the trust property, arguably, matters in relation to trust assets are no longer the property and financial affairs of the settlor, as opposed to those of the trustee and the beneficiaries. Even when the Reserve Power is substantial such that the settlor may exercise effective control of the trust property, the benefits arising from such exercise of powers are only received by the beneficiaries of the trust. Accordingly, the investment and asset management functions are not part of the property and financial affairs of the settlor and the EPOA is unlikely to be able to save the situation.
However, the situation may be different when the settlor is also one of the beneficiaries. The investment and asset management functions may concern the property and financial interests of the settlor. In any event, for the purposes of certainty, the trust deed may be drafted in a way to cater for the situation when a settlor becomes mentally incapacitated and to provide directions on the subsequent exercise of the powers of investment or asset management functions.
Will
Reserve Power in respect of investment and asset management functions is not real or personal property per se. It is a mere power and function created by the trust instrument. Section 41X of the Ordinance also only addresses the reservation of such powers to the settlor and it does not mention his or her successors. If the trust instrument does not specifically allow the powers to survive upon the death of the settlor or be exercisable by the executors or assigns, it is likely the Reserve Power naturally dies with the settlor and cannot be bequeathed by a will.?
As a general proposition, a testator can by law dispose by will of all real and personal estate to which he or she is beneficially entitled for an interest not ceasing at his or her death and which if not so disposed of would have devolved upon his or her executor or administrator. Although certain choses in action, for example, rights of action for damages or other matters which devolve on the personal representative, copyrights and other intellectual property rights can be disposed of by will, a Reserve Power in respect of investment and asset management functions does not belong to the above class of personal rights and properties conferring an interest. It is unlikely that such Reserve Power can be bequeathed by a will.
Nevertheless, there is no harm to include in the settlor’s will a testamentary wish devolving the Reserve Power to a power holder and let the trustee decide on whether or not to follow that power holder’s directions. The trust instrument may also expressly allow a successor power holder to be designated by the settlor.
Conclusion
As Hong Kong positions itself as a leading hub for trusts and family offices, modernizing its trust law to accommodate Reserve Powers will enhance flexibility for settlors and other persons whom the settlors trust, align with international practice, and strengthen its competitiveness against offshore jurisdictions. By validating Reserve Powers such as investment directions, the appointment and removal of trustees or protectors, and the variation of trust terms, Hong Kong can provide settlors with greater confidence in structuring family wealth while ensuring that trusts remain legally robust. The Ordinance may also provide for clarity on the validity of the delegation of powers of the settlors and the limit of liability of the trustees. This can enhance certainty and confidence in the trust regime in Hong Kong. Moreover, this reform will further support the growth of family office services, attract high‑net‑worth individuals seeking sophisticated succession planning, and reinforce Hong Kong’s role as a premier jurisdiction for private wealth management.
Disclaimer: This material is provided for general information only. It does not constitute legal or other professional advice nor constitute any lawyer-client relationship between Sit, Fung, Kwong & Shum and any user or browser. No liabilities are assumed arising from any reliance of information in this material.
Sit, Fung, Kwong & Shum is a Hong Kong Special Administrative Region law firm and does not practice nor provide legal advice on the laws of other jurisdictions. References to the laws position of any other jurisdictions (including but not limited to the British Virgin Islands, the Cayman Islands, Jersey, Bermuda, and Singapore) in this material are provided for general reference and comparative purposes only and do not constitute any advice, opinion or representation on the law or practice in those jurisdictions.
