While the Bloomberg story describing it may have been painfully short, the actual report released by Hong Kong’s Law Reform Commission to propose allowing multiparty litigation, is shall we say, thorough.

If adopted, the 300+ page consultation paper released last week, would add Hong Kong to the growing list of non-US jurisdictions that allow class actions.

There are a number of differences that would set Hong Kong's proposed class action procedure apart from many of the recently enacted class action statutes in other countries.

Most notably, would be the hybrid approach to determining who will be included in the class. The report recommends that the new class action regime generally would operate under an "opt-out" approach, similar to that used in most US class actions. But, and this is a big one, "[w]here the proceedings involve parties from outside Hong Kong, an 'opt-in' procedure should be the default position (that is, persons will not be included in the class litigation unless they take active steps to 'opt in' to the litigation), with a discretion given to the court to adopt an 'opt-out' procedure if the particular circumstances of the case warrant it."

To the best of our knowledge, this two track model is unique among jurisdictions allowing class actions. It may be an attempt to avoid some of the "f-cubed" issues that we are seeing in US cases, as well as allow most cases to avoid having to undertake an in-depth, country-by-country analysis of comity and other international law issues.

Also of interest, the report suggests allowing contingency fees, third-party litigation funders, and public financing, hitting all three of the major regimes that we have already seen implemented to deal with the funding of class actions.

We would be remiss if we did not note for readers that the

[R]ecommendations in the consultation paper are intended to facilitate discussion and do not represent the sub-committee's final conclusions. The sub-committee would welcome views, comments and suggestions on any issues discussed in the consultation paper, and in particular on the questions set out in Chapter 10. The consultation period will last until 4 February 2010.

Comments should be sent to:

The Secretary
The Class Actions Sub-committee
The Law Reform Commission
20th Floor, Harcourt House
39 Gloucester Road
Wanchai
Hong Kong
Telephone: (852) 2528 0472
Fax: (852) 2865 2902
E-mail: hklrc@hkreform.gov.hk

And for those readers that are still scratching their heads over the title of this post, Hong Kong Phooey was a 16-episode Hanna-Barbera animated series that first aired on ABC in September 1974.