From 1 August 2008, an important new mechanism for the recognition and enforcement of judgments between Hong Kong and the People's Republic of China came into effect.  It is a key development which has important implications for parties when negotiating contracts and considering choice of court provisions, and will have a significant impact on transactions between Chinese and non-Chinese parties.

In Hong Kong, the Mainland Judgments (Reciprocal Enforcement) Ordinance ("Ordinance") gives effect to the Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters by the Courts of the Mainland and the HKSAR pursuant to Choice of Court Agreements between Parties Concerned made between the PRC's Supreme People's Court and the Hong Kong government on 14 July 2006 (the "Arrangement").

In the PRC, the Supreme People's Court has issued a Judicial Interpretation ("SPC's Judicial Interpretation") setting out the procedures to be undertaken in the PRC for enforcement of Hong Kong judgments by PRC courts.  The SPC's Judicial Interpretation also took effect on 1 August 2008.