Hong Kong’s arbitration edge boosts legal finance, Burford CEO says

Hong Kong holds strategic advantages as an arbitration hub in Asia, particularly due to its unique arbitration framework and growing commercial activities within China, according to a US-listed legal finance company.\nThis competitive edge was poised to stimulate more business and increase the frequency of arbitrations, driving growth in the legal finance sector, said Christopher Bogart, CEO and co-founder of Burford.\n“The Hong Kong arbitration practice has a long history and is very high quality,” Bogart said in an interview with the Post in Hong Kong.\nWith the rise of economic activity in China and the special arrangements for arbitration between Hong Kong and the mainland, the city held distinct advantages over other centres, according to Burford. The firm is publicly listed on both the New York and London stock exchanges, managing a portfolio valued at US$7.5 billion.\nIn February, mainland China introduced a new policy allowing Hong Kong enterprises in certain Greater Bay Area cities to designate Hong Kong as their seat of arbitration – previously not permitted under Chinese law.\nThe special arrangement facilitated the enforcement of Hong Kong arbitration awards on the mainland more readily than awards from other arbitration centres, according to Bogart. “That is significant,” he said.\n\nHong Kong has been actively positioning itself as a hub for arbitration and mediation. In May, the International Organisation for Mediation was established in the city to create an intergovernmental platform for resolving global disputes. Algeria, Pakistan, Indonesia, Cambodia, Belarus, Venezuela and Cuba are among its 33 founding member countries.\nHong Kong was the most preferred seat of arbitration in the Asia-Pacific and the second most preferred worldwide, according to the 2025 International Arbitration Survey conducted by the Queen Mary University of London.\nThe Hong Kong International Arbitration Centre Rules were also the most favoured set of arbitration rules in the Asia-Pacific and the second most preferred globally.\nBogart noted that the legal finance business was expanding in Asia, particularly in Hong Kong, amid rising commercial activities and increasing legal costs.\nCommercial legal finance – also known as litigation funding, litigation finance or third-party funding – enables businesses and law firms to use capital from third-party finance providers to cover costs associated with commercial litigation and arbitration.\nThis capital was typically non-recourse, meaning repayment only occurred upon a successful resolution, Bogart said.\nThe global market for litigation funding was projected to grow at a compound annual growth rate of around 11 per cent from 2025 to 2037, driven by an increase in legal disputes and the number of litigation funders, according to the analysis provider Research and Markets.\nThe market was forecast to generate about US$60 billion in revenue by the end of 2037, up from nearly US$16 billion in 2024. The North American market was expected to achieve the highest revenue, reaching roughly US$20 billion by the end of 2037 from just under US$7 billion in 2024.\n“I have high confidence that Asia will grow, given that the volume of disputers and the costs of disputes continue to go up,” Bogart said.\n