In a recent decision of HD HYUNDAI INFRACORE CHINA CO., LTD v. LI ZHIWEI [2025] HKCFI 5714, the Hong Kong Court of First Instance provided significant clarity on the enforcement of Mainland Chinese judgments, particularly compensation orders arising from criminal proceedings, under the Mainland Judgments in Civil and Commercial Matters (Reciprocal Enforcement) Ordinance (Cap.645) (the “Ordinance”).
Background
The dispute arose from a fraud perpetrated against HD Hyundai Infracore China Co., Ltd. (the “Plaintiff”), resulting in a loss of approximately RMB 190 million. Li Zhiwei (the “Respondent”), one of the fraudsters, was convicted in the Mainland in 2017. In 2022, the Higher People’s Court of the Inner Mongolia Autonomous Region finalised a judgment requiring the joint and several return of the RMB 190 million to the Plaintiff.
The enforcement proceedings initially recovered approximately RMB 24.9 million and were terminated in July 2023. Following the commencement of the Ordinance in Hong Kong in January 2024, the Plaintiff applied to the Intermediate People’s Court of Wuhai City, Inner Mongolia Autonomous Region (the “IPC”) to resume enforcement proceedings. In 2024, an enforcement ruling was issued, ordering the return of the remaining RMB 162,061,811.37 (the “2024 Criminal Enforcement Ruling”). The Plaintiff subsequently initiated legal action in Hong Kong against the Respondent in December 2024, seeking to register a part (the “Relevant Part”) of the 2024 Criminal Enforcement Ruling as follows: -
“现責令李志伟 [Li]… 向被害单位艾奇蒂现代迪万伦工程机械有限公司 (原名斗山工程机械 (中国 )有限公司 ) [HD Hyundai] 退赔人民币162061811.37 元 。”
Legal Issues
The main legal challenge was determining whether an "enforcement ruling" issued by a Mainland court under the Ordinance was registrable. To address this, the Court examined the following key legal issues: -
- Whether the 2024 Criminal Enforcement Ruling falls within the definition of a “Mainland Judgment”, which means “a judgment, ruling, conciliatory statement or order of payment given or made by a court in the Mainland, but does not include a ruling given in respect of an interim measure” under section 2 of the Ordinance;
- Whether a compensation order given in criminal proceedings qualifies as a “civil or commercial matter” under section 3(1)(a) (ii) of the Ordinance; and
- Whether the 2024 Criminal Enforcement Ruling was “effective”, i.e., enforceable and non-appealable, in the Mainland.
The Court’s Analysis
The Honourable DHCJ Mr. Wong outlined the concerns of Master Hui, who had dismissed the ex parte application on 12 March 2025, on the grounds that the 2024 Criminal Enforcement Ruling appeared to be a mere administrative outcome of enforcement and therefore not a registrable judgment under the Ordinance. However, the Plaintiff lodged an appeal and adduced further evidence, including an explanatory note from the IPC and an expert report from Mr Jiang Zhe.
Regarding the nature of the 2024 Criminal Enforcement Ruling, Mr. Jiang’s expert evidence clarified that it falls under category 11 (i.e., “other matters to be settled by a ruling”) pursuant to Article 157 of the Civil Procedural Law of the Mainland (the “CPL”), rendering it a legally effective (i.e., enforceable and non-appealable) judgment in the Mainland. Further, the 2024 Criminal Enforcement Ruling involves resumed enforcement and an order for asset transfer, rather than being a mere asset-preservation ruling.
Given that the enforcement procedure is independent of the trial procedure in the Mainland, the Court held that an enforcement ruling is an independent, standalone decision rather than a mere repetition of the underlying criminal judgments. In particular, the validity of a duly issued enforcement ruling remains unaffected even if the underlying legal instrument is revoked or found to be erroneous. An enforcement ruling may also address facts beyond the scope of the underlying judgment and/or that occurred after the judgment.
In adopting textual, purposive and systematic approaches suggested by the PRC legal expert, the Court held that the Relevant Part, despite appearing before the words “裁定如下”, remained an operative part of the 2024 Criminal Enforcement Ruling.
The Honourable DHCJ Mr. Wong ordered, inter alia, the registration of the Relevant Part.
Significance
This case demonstrates the Hong Kong courts’ intention to uphold a simple and straightforward registration regime without scrutinising the evidence and documents in Mainland proceedings. It is followed by the Hong Kong courts’ deference to the IPC’s explanatory note and the PRC expert evidence when interpreting the nuances of Mainland laws, whether procedural or substantive.
Another key insight is despite the underlying criminal judgment was handed down in 2022, the Hong Kong Court accepted the IPC’s explanatory note and the PRC expert opinion and recognized that the 2024 Criminal Enforcement Ruling as an independent and standalone judgment. As noted, an enforcement ruling remains valid even if the underlying trial judgment is later revoked. Accordingly, the 2024 Criminal Enforcement Ruling (which was dated after the commencement of the Ordinance) is considered independent and therefore registrable, even where the criminal offence and conviction occurred before the Ordinance’s commencement date.
In a separate proceeding, the interlocutory injunction was granted in favour of the Plaintiff pursuant to section 21M of the High Court Ordinance (Cap.4) in May 2024, 7 months before the filing of the registration application in December 2024. This was intended to aid Mainland enforcement proceedings and the subsequent registration in Hong Kong. Coupled with the new registration regime, ancillary reliefs will hopefully ensure the effective enforcement of Mainland legal interests and assist in preserving assets.
Importantly, this case establishes a notable precedent for the application of the Ordinance, illustrating a nuanced shift from the old registration regime. The broader scope of the new registration regime provides a more effective and convenient route to recovery.
Conclusion
Mainland judgement given in proceedings that are criminal in nature and contains an order for the payment of a sum of money in respect of compensation or damages by a party to the proceedings were not covered in the old registration regime. The present case clarifies significantly on how this part of the new registration regime would actually come into place. This precedent serves as a good guidance to the practitioners for the analysis on the nature of the criminal judgments and their registrability under the new regime. It is most welcome that the Hong Kong Court in this case did demonstrate the determination to adopt a pragmatic and facilitating approach to enforcing compensation orders from Mainland criminal proceedings.
This article is co-authored by our Partner Jenny Wong and our Trainee Solicitor Jasper See.
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