ACT 3154 Notes 1
ACT 3154 Notes 1
ACT 3154 Notes 1
The Basic Law is supreme over other legal sources (legislation, common law and equity)
Article 11(2): No law enacted by the legislature of the Hong Kong Special Administrative
Region shall contravene this Law.
Some legislations have been invalidated (declared to be invalid) under this article since
1997.
Example: A minor provision in the Securities (Insider Trading) Ordinance (Cap 395) was
invalidated by the Court of Final Appeal in Koon Wing Yee v Insider Dealing Tribunal
(2008) 11 HKCFAR 170
The Basic Law has more impact on human rights (in particular right of abode) and
political system of HKSAR. However, it has very little conflict with business law of
HKSAR.
[D] Legislation 立法
What is legislation?
Legislation is the law passed by the legislature 立法机关(the Legislative Council in Hong
Kong).
Legislation is in contrast with judge made law(the law made by judge 和中国的不同之
处,在中国 judge 只 apply the law) (common law and equity)
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(电子版香港法例 HK e-legislation <elegislation.gov.hk>)The process of legislation is
as follows:
1. Drafting bills
2. Notice of intention to present a bill
3. Presentation and publication of bills
4. Passage of a bill through the Legislative Council
a. First reading
b. Second reading
c. Third reading
5. Chief Executive’s signature and promulgation
6. Commencement
7. Reporting to the Standing Committee of the National People’ Congress 人 大 常 委
(NPCSC)
In some branches of law, common law dominates e.g. Contract Law, Tort Law, Agency
Law. In other branches of law, legislation dominates e.g. Company Law.
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Company Law
Companies (Winding Up and Miscellaneous Provisions) Ordinance (cap.32)
Companies Ordinance (cap.622)
William the Conqueror unified England in 1066 extracted the law common to the whole
country. It is the reason why it is called common law.
Common law are simply rules made by the judges in the common law courts and
developed over many centuries.
Equity means that body of law developed in courts of equity (Court of Chancery was the
most important one) in the 12th century in response to the defects of common law as a
supplement to the Common Law.
Equity is mainly civil law. Equity rules are similar to common law as both of them are
legal principles made by the judges. When compared with common law, equity rules are
fairer and more flexible.
The impact of equity is mainly on contract law, land law and trust law.
In contract law, equity provides more remedy which is called equitable remedies (common
law only provides the remedy of damages:
i) Recission 撤銷合約(cancellation of the contract)
ii) Injunction 禁制令(to stop the breach of the contract)
iii) Specific performance 強制履行令(to order a party to the contract to perform
the contract)
In 1873, all the courts were directed to apply the principles of both the common law and
the law of equity.
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Precedent- a previous judicial decision- a previous case
Principle of law – “ratio decidendi” of the case (or ratio)- the principle underlying the
decision in the case or the reason for the decision
The principles of law under common law and equity are applied by the courts in all
subsequent cases through the doctrine of precedent. In general, lower courts are bound by
the decision of the higher courts. All the courts will usually follow their own previous
cases.
Ranking of Law
Basic Law (a constitutional document)
Legislation
Equity
Common Law
Examples:
When basic law and legislation are in conflict, basic law prevails.
When legislation and equity are in conflict, legislation prevails.
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d. Click the Westlaw Asia (you can also find the HK cases in this website)
e. Enter the parties’ names, etc., that will lead you to the relevant court case.
The judiciary consists of the courts and the tribunals ( 審 裁 處 ). Tribunals are informal
courts using informal procedures and are usually specializing in certain types of cases.
We have to know the jurisdiction of the courts. Jurisdiction to hear a case
審判權 means the authority to hear and determine matters in legal proceedings brought
before a court or tribunal.
Jurisdiction is divided into original 原訟 and appellate 上訴 jurisdiction.
Court Jurisdiction
The Court of Final Appeal (CFA)( 終 審 法 Unlimited appellate jurisdiction to hear
院) appeal from CA and CFI
The Court of Appeal (CA)(上訴法庭) Unlimited appellate jurisdiction to hear
appeal from CFI and DC
The Court of First Instance (CFI)( 原 訟 法 Unlimited Appellate jurisdiction to hear
庭) appeal from CFI and DC
unlimited original jurisdiction
The District Court (DC)(區域法院) Original jurisdiction in civil case- 3 million
dollars
Original jurisdiction in criminal case-
maximum penalty of 7 years imprisonment
Students are encouraged to check with textbooks (pg.40 D.K.) and references to
understand the jurisdiction of the courts and route of appeal.
Parties may also resolve their disputes by alternative dispute resolution (ADR).The most
typical examples are arbitration 仲 裁 and mediation 調 解 . The advantages of ADR
alternative include:
i) lower cost;
ii) more efficient
iii) more flexible
iv) confidential
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[G] The legal profession
Tend to be case centred and hence judge Tend to be a codified body of general
centred, allowing scope for a discretionary abstract principles which control the
pragmatic approach to the particular exercise of judicial discretion.
problems
Case law is an independent source of law Judges apply the law in a code (Criminal
Code and Civil Code)
Judges are bound by precedents Judges are not bound by precedents
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Money laundering refers to the carrying out of transactions involving funds or property
that are owned or controlled by terrorists or transactions that are linked to terrorist
activities
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vi) when the financial institution doubts the veracity or adequacy of any information
previously obtained for the purpose of identifying the customer or for the purpose of
verifying the customer’s identity.
Such requirements include verifying the customer’s identity on the basis of documents, data or
information and verifying the identity of the beneficial owner, which is defined to be
anyone owns or controls, directly or indirectly, including through a trust or bearer share holding,
more than 25% of the issued share capital of the client .
Section 4: Any public servant who solicits or accepts any advantage as an inducement to
or reward for performing duties shall be guilty of an offence; the offeror of the
advantage shall also be guilty of an offence.
Section 5: Any public servant who solicits or accepts any advantage as an inducement
to or reward for giving assistance or using influence in matters relating to
a contract shall be guilty of an offence; the offeror of the advantage shall
also be guilty of an offence.
Section 10: Any prescribed officer who maintains a standard of living or has assets not
commensurate with his official emoluments shall be guilty of an offence.
Private sector
Section 9: No agent (usually an employee) shall solicit or accept any advantage
without the permission of his principal when conducting his principal’s
affairs or business.
No agent (usually an employee) shall solicit or accept any advantage without the
permission of his principal (usually the employer) when conducting his principal's affairs
or business; the offeror of the advantage is also guilty of an offence.
In the Ordinance:
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"Entertainment" means the provision of food or drink, for consumption on the occasion
when it is provided, and of any other entertainment provided at the same time, for example
singing and dancing. Although the acceptance of entertainment does not breach the
POBO, individual departments will still stipulate the conditions for staff’s acceptance of
entertainment.
Public servants are those who work for the Hong Kong SAR government and specified
public bodies (公共機構) in Hong Kong, including the Legislative Council, the Executive
Council, the District Board., various boards / commissions / committees, etc. established
by the government, the government-funded universities, the government-funded
companies like Kowloon-Canton Railway Corporation, the public utilities like China
Light and Power Company, and for the purpose of the ordinance, some important non-
government institutions like the Stock Exchange of Hong Kong Limited (section 2 and
schedules 1-2), etc., as well as certain prescribed officers (訂明人員) like, in addition to
the civil servants, the principal officials (政府主要官員) and judges (section 2).
Prescribed officers are subject to Sections 3, 4, 5 and 10 of the POBO while employees of
public bodies (e.g. power company, bus company, hospital, etc) are subject to Sections 4
and 5
Readings
Acknowledgment
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Arthur McInnis and Stephen Chan, “Legal System of Hong Kong”, D.K. Srivastava, ed.,
Business Law in Hong Kong (Hong Kong: Sweet & Maxwell Asia, 5th ed., 2017)
Anne Carver, Hong Kong Business Law (Hong Kong: Longman, 6th ed., 2004)
Danny Gittings, Introduction to the Hong Kong Basic Law (Hong Kong: Hong Kong
University Press, 1st ed., 2013)
Slapper & Kelly, The English Legal System (Cavenish 8th ed 2006)
Peter Wesley-smith, An Introduction to the Legal System of Hong Kong (Hong Kong:
Oxford University Press, 2nd ed., 1993).
Website of the Hong Kong judiciary (www.judiciary.gov.hk)
Website of the ICAC (www.icac.gov.hk)
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