## [International Arbitration Newsletter - January 2019 | Regional Overview: Asia Pacific](/en_GB/new/international-arbitration-newsletter-january-2019-regional-overview-asia-pacific) # International Arbitration Newsletter - January 2019 | Regional Overview: Asia Pacific 01 / 28 / 2019 - - [](https://www.linkedin.com/sharing/share-offsite/?url=https://www.garrigues.com/en_GB/new/international-arbitration-newsletter-january-2019-regional-overview-asia-pacific) - []() - []() Previous Next **The most relevant Asia Pacific updates from the global International Arbitration and ADR practice group at Garrigues.** ### **CHINA** **US-based startup Faraday Future settles CIETAC dispute** US-based start-up **Faraday Future**, one of the world´s leaders in intelligent electric cars, has announced recently that it settled an HKIAC arbitration it initiated with its Chinese investor after it generated two emergency arbitrator awards. The dispute related to a claim of Faraday against **Season Smart**, the Hong Kong arm of Chinese real estate giant **Evergrande** , accusing it of withholding payments promised to the company in an attempt to gain control of its Chinese operations and intellectual property. The California start-up said it needed the money to finance the production of a new electric vehicle, the FF91, which is scheduled for delivery later this year. **CIETAC to hear music-streaming dispute** Chinese businessman **Hanwei Guo** has brought a claim before the China International Economic and Trade Arbitration Commission (**CIETAC**) alleging he was defrauded and coerced into selling his stake in a music-streaming business that hopes to raise US$1.23 billion in an initial public offering in the US. Hanwei Guo says he was an early investor in what is now **Tencent Music**, China’s largest music-streaming service. His claim is against the company, its co-president **Guomin Xie** and others. The case relates to an investment of US$26 million in Tencent between 2012 and 2013 when it was known as **Ocean Music**. In return Guo received a 50% interest in Ocean Music's operating company and options for 48 million shares in various related entities. Guo says he was promised the company would be profitable within two years and would go public within three. However, Guo says he was later told that the business was in financial difficulties and that he should sell his stake to minimise his losses, despite the fact that Ocean had without his knowledge obtained backing worth US$100 million from other investors. Guo seeks the return of his equity stakes in the Ocean Music companies and more than US$14 million in compensation for economic loss. ### **INDIA** **Gas migration award challenged by India** The Delhi High Court has set aside an UNCITRAL award in favour of Indian energy company **Reliance Industries** and its foreign partners, Canada’s **Niko Resources** and UK´s **British Petroleum, (BP)**. The dispute relates to gas block KG-D6 in the Bay of Bengal. India’s **Oil and Natural Gas Corporation (ONGC)** claimed that Reliance and its partners had unfairly profiteered from gas that came from neighboring fields in the Bay of Bengal. The court accepted ONGC’s claims and held that it was entitled compensation amounting to USD 1.55 billion. **India requests arbitration proceedings to be heard by Delhi High Court** On 9 January 2019 the Delhi High Court agreed to hear a request filed by the Indian **Ministry of Defence** seeking to halt an ad hoc arbitration over a dispute relating to the supply of helicopters filed by **Agusta Westland** in 2013. The Indian government based its request on the ongoing criminal cases before the trial court. The justice asked Agusta Westland and the Defence Ministry of India to file their affidavits with five weeks. The case will be heard by the Delhi High Court on 28 February 2019. Agusta Westland, an Anglo-Italian helicopter company, agreed to supply 12 high-end helicopters to the India in 2010. Having paid 30% of the amount and acquired three helicopters of the 12, the government withheld further payment in February 2013 due to the suspicion of bribery by Agusta Westland and its parent company, **Finmeccanica**, to procure the deal in 2010 and the arrest of executives of the companies in Italy. Agusta Westland filed the arbitration against the Indian government in October 2013, contending that the Ministry of Defence cannot unilaterally freeze payments. In Italy, prosecutors investigated the companies of the alleged bribes until a “negligible fine” was paid by Agusta Westland. Two former executives of Agusta Westland were sentenced to at least four years imprisonment in 2014 but the convictions were overturned in the later appeal trial. In India, **Christian Michel**, one of the alleged middlemen responsible for securing the deal in 2010, has been in police custody since his extradition from Dubai in December, 2018. The criminal proceedings against Agusta Westland before the trial court are still underway in India. ### **HONG KONG** **Hong Kong government publishes code of practice for third-party funding** The Hong Kong government has announced the publication of a code of practice for third-party funding of arbitration, and also announced amendments to Hong Kong’s arbitration ordinance which will come into effect on 1 February 2019. The Hong Kong Department of Justice says the legislation will create greater certainty that third-party funding of arbitration in Hong Kong is not prohibited by the common law doctrines of maintenance and champerty and that “this will add to the attractiveness of Hong Kong as an international arbitration centre.” The new legislation introduces a regulatory framework for the funding of arbitration and mediation based around a code of practice – with the code to be developed following a public consultation. 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