Regulation of the Legal Profession in Hong Kong: Overview

There are two categories of lawyers in Hong Kong:

Students must first complete a degree in law, such as the Bachelor of Laws, Juris Doctor or other recognised law qualifications from an eligible institution. They must then complete the Postgraduate Certificate in Laws (PCLL) in one of the recognised Hong Kong universities, including the University of Hong Kong, the Chinese University of Hong Kong and the City University of Hong Kong. All overseas applicants must also complete the PCLL conversion programme.

There are two routes to become a barrister or a solicitor in Hong Kong:

After completing the PCLL, prospective barristers must undertake a pupillage for a year before they can apply for full practice and they can apply for limited right to practice under the supervision of their pupil master after six months of pupillage. Trainee solicitors must complete two years of training in a Hong Kong law firm before they can apply for admission as a solicitor.

In-house barristers and solicitors must also renew their practising certificates every year. In particular, an in-house solicitor who acts in litigation or conveyancing transactions must carry an unconditional practising certificate (that is, a certificate that does not bear any condition restricting them not to practise as a solicitor on their own account or in partnership) or be supervised by a solicitor holding a current unconditional practising certificate. In-house solicitors are subject to the same rules and regulations governing a solicitor in private practice, including the requirements on completing CPD.

A lawyer admitted in Hong Kong can advise on Hong Kong law, while a registered foreign lawyer in Hong Kong can only practise the law of their jurisdiction and is prohibited from practising Hong Kong law (see Question 12).

There are no express restrictions on lawyers' area of practice but the Hong Kong Bar Association (Bar Association) and the Hong Kong Law Society (Law Society) have specified in their respective codes of conduct that a barrister/solicitor owes a duty to the client to be competent to perform the legal services. This means that they must not undertake a matter without being competent to handle it.

Barristers must abide by the Code of Conduct (Bar Code) issued by the Bar Association. Solicitors must abide by the Hong Kong Solicitors' Guide to Professional Conduct (Solicitors' Guide) issued by the Law Society.

The Bar Code and Solicitors' Guide set out the standard of conduct required for barristers and practising solicitors respectively, for example, by providing codes and guidelines on fees, conflict of interest, and duty of confidentiality.

The key legislation governing the legal profession in Hong Kong is the Legal Practitioners Ordinance (Cap. 159) and its subsidiary legislation. (see Question 5 for professional conduct rules)

Solicitors are also bound by rules and guidance issued by the Law Society by virtue of their membership. Under Article 6 of the Law Society's Articles of Association, all members are bound by the Articles of Association and all Practice Directions, rules and regulation of the Law Society.

Both barristers and solicitors have the right to conduct litigation in court.

Under the Bar Code and the Solicitors' Guide, both barristers and solicitors owe a duty to the court and they must never knowingly deceive or mislead the court. They must cease to act if it comes to their knowledge that the client has committed perjury or misled the court in any material matter unless the client agrees fully to disclose their conduct to the court.

Barristers have unlimited rights of audience to appear before all courts in Hong Kong (see Question 1).

Solicitors do not have general right of audience in courts but some rights have been acquired by statute, rule or usage of particular courts. In particular, solicitors have statutory rights of audience in the Lands Tribunal, Magistrates' Courts, Coroner's Court, the District Court and arbitration proceedings and appeals. Solicitors who have at least five years of post-qualification experience (PQE) with sufficient relevant experience in advocacy may be granted the right to appear in the Competition Tribunal, the High Court and above in civil and criminal proceedings. Except for solicitors who have been granted the higher rights of audience and in limited circumstances (that is, hearings before a Master and hearings in chambers), solicitors are prohibited from appearing in contested hearings in the High Court or the appeal courts.

Law firms in Hong Kong are organised in the following forms:

Barristers are self-employed independent legal practitioners.

While barristers usually practise in chambers, their legal, financial and professional duties are separate and distinct from other barristers sharing the same chambers.

Multi-disciplinary practices (MDPs) are not allowed in Hong Kong and neither solicitors nor barristers can share their practice with other non-legal services.

There are a few advice centres and pro bono units in Hong Kong as set out below:

The requirements of the Legal Practitioners Ordinance and its subsidiary legislation apply to community legal service providers which are held out to the public as providing legal services.

The Law Society has issued guidelines on the application for exemption to the requirement of maintaining indemnity under the Professional Indemnity Rules when pro bono legal services are offered in the solicitor's personal capacity and not as part of the practice of their law firm. This may include free legal advisory schemes organised by charities and non-governmental organisations where individual solicitors have volunteered to provide legal advice to the public on a pro bono basis.

All barristers in Hong Kong are self-employed. For restrictions imposed on barristers, see Question 1.

There are no specific regulations or restrictions that apply to self-employed solicitors. Some law firms in Hong Kong do provide solicitors with the option of being self-employed; providing their services on a freelance basis. The law firm will help the self-employed solicitor to obtain their practising certificate and provide professional indemnity insurance coverage for the self-employed solicitor.

The solicitor must set up a limited company of which they will be the sole shareholder and company director. When providing legal services, the company will enter into contracts with the law firm or with the clients assigned by the law firm. The company will invoice the law firm or clients for the legal services provided, and then pay for the remuneration of the self-employed solicitor.

Foreign lawyers can provide temporary legal services in person (on a "fly-in, fly-out" basis) subject to certain restrictions. Under section 50B(2) of the Legal Practitioners Ordinance, a foreign lawyer who is not registered as a foreign lawyer with the Law Society can provide temporary foreign legal services in Hong Kong provided that they do so from within a registered foreign law firm or a Hong Kong law firm for no more than three continuous months or 90 days in any 12-month period.

Foreign lawyers cannot advise on Hong Kong law and cannot represent clients in the Hong Kong courts. However, an overseas barrister can be admitted by the Hong Kong High Court for the purpose of a particular case (see below, Bar admittance).

Overseas solicitors. Foreign lawyers must register with the Law Society as registered foreign lawyers. A registered foreign lawyer can practise the law of the jurisdiction in which they are qualified but cannot practise Hong Kong law. Hong Kong law firms can employ registered foreign lawyers as employees but they cannot admit foreign lawyers as partners of the firm.

Overseas law firms. There are three approaches that a foreign law firm can take to establish a commercial presence in Hong Kong:

Overseas barristers. An overseas barrister must first be admitted to the Hong Kong Bar before they can work as a barrister in Hong Kong.

An overseas barrister can also be admitted by the Hong Kong High Court for the purpose of a particular case. The court has unfettered discretion in deciding whether to admit an overseas barrister and in considering whether to grant in favour of an admission, the court considers the difficulty and complexity of the matter, whether the case is substantial and whether the overseas barrister can make a significant contribution because of their expertise. In such cases, the overseas barrister must be instructed together with a Hong Kong barrister.

Overseas barristers. An overseas lawyer who has been in practice for at least three years can apply for admission to become a barrister in Hong Kong after completing the Barristers Qualification Examination and finishing six months of pupillage.

Overseas solicitors. An overseas lawyer who is admitted in a common law jurisdiction and has at least two years of post-admission experience (or five years if admitted in a non-common law jurisdiction) can apply for admission as a solicitor in Hong Kong after completing the Overseas Lawyers Qualification Examination.

Registered foreign lawyers. Registered foreign lawyers working in Hong Kong law firms are required to complete the applicable statutory RME requirements in each practice year (see Question 3).

An overseas lawyer registered with the Law Society to practise the law of the jurisdiction in which they are qualified in Hong Kong is referred to as "registered foreign lawyer".

The legal profession in Hong Kong is self-regulated by the Bar Association and the Law Society.

The Bar Association is a professional organisation of barristers in Hong Kong. It is governed by an executive committee known as the Bar Council and its powers include:

The Law Society is a professional association for solicitors (including trainee solicitors and foreign lawyers) and its powers include:

The register of barristers and solicitors can be accessed on the website of the Bar Association (www.hkba.org/) and Law Society (https://www.hklawsoc.org.hk/en/ ) respectively.

It is mandatory for barristers and solicitors to be members of the Bar Association and Law Society respectively. The contact details of the Bar Association and Law Society can be found on their website.

The Barristers Disciplinary Tribunal is an independent body and it deals with cases referred by the Bar Council where a barrister acts in breach of the Bar Code. It consists of members appointed by the Chief Justice and can impose different forms of punishment which include striking-off or suspending a barrister and imposing a fine of up to HKD500,000.

The Solicitors Disciplinary Tribunal is an independent body and it deals with disciplinary cases brought by the Law Society against solicitors, registered foreign lawyers, trainee solicitors or an employee of a solicitor or a registered foreign lawyer in Hong Kong for alleged professional misconduct. Examples of professional misconduct include breaches of any of the provisions of the Legal Practitioners Ordinance, Practice Directions or circulars issued by the Law Society, principles of the Solicitors' Guide and other rules, principles and guidelines governing professional conduct.

The Solicitors Disciplinary Tribunal is constituted by members selected from the Solicitors Disciplinary Tribunal Panel who are appointed by the Chief Justice. It has a wide range of disciplinary powers including striking-off the name of a solicitor, suspending a solicitor and imposing a fine not exceeding HKD500,000.

Indemnity insurance is mandatory for practising lawyers in Hong Kong.

All barristers (including pupils in limited practice) must be insured under the Master Policy for professional indemnity insurance effected by the Bar Association for and on behalf of its members, at the rates and in the amounts determined by the Bar Council from time to time. The current compulsory coverage under the Bar's Professional Indemnity Insurance is HKD10 million. Barristers can top up their insurance to cover liability in excess of HKD10 million.

All solicitors' firms must be insured under the Solicitors Professional Indemnity Scheme. The statutory level of indemnity for each claim made on or after 1 October 2019 is HKD20 million. Law firms can take additional insurance to cover any liability in excess of HKD20 million. For each indemnity period, every principal in practice is required to produce a report to the Hong Kong Solicitors Indemnity Fund Limited containing particulars of the gross fee income immediately preceding the accounting year of the practice.

Under the Bar Code, a barrister cannot accept a brief or instructions or appear as counsel if:

If, after delivery of a brief or instructions on behalf of more than one client, there appears to be a conflict of interest between them, a barrister cannot continue to act for such client unless the clients consent and the barrister is able to do so without embarrassment. A barrister will be embarrassed if, for example, it is obvious that an issue contentious between the clients may arise as the matter progresses.

Chapter 9 of the Solicitors' Guide sets out the following rules on conflicts of interest:

In limited circumstances (that is, sale and purchase of a unit in an uncompleted development) and subject to certain restrictions, a solicitor can act for both the seller and buyer in the transaction.

Solicitors and barristers must cease to act when a conflict of interest or a significant risk of conflict of interest arises. In such circumstances, it is recommended that the solicitor should refer the clients to another solicitor.

If a conflict of interest arises after delivery of a brief or instructions on behalf of more than one client, a barrister cannot continue to act for such client unless the clients consent and the barrister can do so without embarrassment.

In limited circumstances (that is, in the sale and purchase of a unit in an uncompleted development) and subject to certain restrictions, a solicitor can act for both the seller and buyer in the transaction.

A solicitor or firm of solicitors must not accept instructions to act for two or more clients where there is a conflict or a significant risk of conflict between the interests of those clients.

If a solicitor has accepted instructions from two clients in a matter or related matters and a conflict subsequently arises between the interests of those clients, the solicitor must cease to act for both clients, unless the solicitor can without embarrassment and with propriety, continue to represent one client with the other's consent.

A solicitor can only continue to represent one client where they are not in possession of relevant confidential information and knowledge concerning the other obtained while acting for the other. Even in such a case they should seek the consent of the other client (usually through their new solicitor) and should proceed in the absence of such consent only if there is no good cause for its refusal.

Complaints about solicitors' professional conduct should be made to the Law Society and complaints about barristers' professional conduct should be made to the Bar Association.

Lawyers and law firms in Hong Kong can hold client files, money or property in the event of a dispute about their retainer or fees.

Solicitors in Hong Kong can impose a lien over a client's documents, money (other than trust money) and other properties until their costs are paid. However, it is stated in the Solicitors' Guide that the solicitor's papers should normally be released to the successor solicitor subject to a satisfactory undertaking given by the successor solicitor. The court can also make an order requiring the former solicitor to hand over the client's documents to the successor solicitor against an undertaking to preserve their lien.

In criminal matters, the retainer must be in writing signed by the firm and the client and it must include the following mandatory provisions:

In civil matters, although it is not mandatory to have a retainer letter, it is advised under the Solicitors' Guide that solicitors should prepare a retainer letter identifying the scope of service to be provided and the costs to be charged, to avoid any potential dispute with the client and the client should sign the letter in confirmation. Further, a written agreement signed by the client is required if the solicitor firm charges an agreed fee or intends to render interim bills.

In addition, a retainer letter generally includes the following provisions:

There are generally no separate provisions for contentious and non-contentious matters (except to the extent that the scope of service and the fee arrangement may be different).

A solicitor is under a duty to keep the client properly informed. The extent and frequency of the information supplied depends on the circumstances of each case and on the type and urgency of the matter.

A client should be informed of the name and status of the person responsible for the conduct of the matter on a day-to-day basis and the partner responsible for the overall supervision of the matter. If the matter is transferred to another person in the firm, the client should be informed.

A solicitor must obtain the client's consent before instructing a barrister. The solicitor should also inform the client of the name of the solicitor or barrister who will represent the client at a hearing.

A client should also be informed about recent changes of the law where those changes affect the subject matter of their retainer.

A solicitor should also keep their client informed on an appropriately regular basis of the approximate costs incurred to date.

Barristers are subject to the "cab-rank rule" under which a barrister is bound to accept any brief to appear before a court in the field in which they profess to practise at their usual fee, having regard to the type, nature, length and difficulty of the case. Special circumstances such as a conflict of interest or the possession of relevant and confidential information may justify their refusal to accept a particular brief. Only barristers are subject to the "cab-rank rule". The underlying principle of this rule is to prevent barristers from refusing instructions from clients on political, moral or other grounds.

Solicitors can decide whether to refuse to accept an instruction. However, a solicitor cannot refuse to accept instructions based on the race, colour, ethnic or national origins, sex or religious or political beliefs of a prospective client. In addition, when deciding whether to represent a prospective client who is accused of a crime, a solicitor cannot be influenced by their own opinion of the client's guilt.

A solicitor can terminate a retainer in accordance with the terms of the written retainer. If there is no written retainer, a solicitor can terminate for good reasons and by reasonable notice. Examples of good reasons include where a solicitor cannot continue to act without being in breach of the law or rules of professional conduct, where a solicitor is unable to obtain clear instructions from a client, where there is a serious breakdown in the confidence between them or where a conflict of interest arises.

A solicitor also has a good reason to terminate a retainer if a client does not pay disbursements when required. If there is a written agreement between the solicitor and their client for payment of interim bills, a failure to pay the solicitor's costs and anticipated disbursements can justify termination by the solicitor.

Subject to exceptions authorised by custom or the Bar Council, lay clients do not have direct access to barristers. Barristers can only provide legal services to lay clients on the instructions of solicitors.

Lawyers are bound by client confidentiality rules.

Under Chapter 8 of the Solicitors' Guide, a solicitor has a legal and professional duty to hold in strict confidence all information concerning the business and affairs of their client acquired in the course of the professional relationship. This duty survives the professional relationship and continues indefinitely after a solicitor has ceased to act for a client.

Under Chapter 10 of the Bar Code, a barrister employed as counsel is under a duty not to communicate to any third person information which has been entrusted to them in confidence. This duty continues after the relation of counsel and client has ceased.

The exceptions to the client confidentiality rules are as follows:

Communications covered by legal professional privilege are protected from disclosure in judicial or other proceedings. There are two classes of legal professional privilege, namely, legal advice privilege and litigation privilege.

Legal advice privilege protects communications between a client and their lawyer which have been made for the purpose of obtaining legal advice.

Litigation privilege extends the protection to all communication between a lawyer, their client and other third parties. It protects communications that arise after litigation is commenced or contemplated and which are produced for the dominant purpose of the litigation.

In-house lawyers have the same legal professional privilege protection as lawyers in private practice. In so far as the communications related to legal advice, the communications are protected.

Barristers' fees are regulated by the Bar Code. According to the Bar Code, a barrister must be separately instructed and remunerated by a separate fee for each item of work. The Bar Code prohibits a barrister to accept a fixed salary for advising over a fixed period.

For court attendance, the barrister's fees include:

A solicitor is personally liable for the payment of a barrister's fees. In the event of a dispute relating to the barrister's fees, a joint tribunal consisting of the Bar Council and the Council of the Law Society will adjudicate the dispute. If the joint tribunal holds that a solicitor has failed to pay the fees of a barrister, the joint tribunal will refer the matter to the Law Society as a case of professional misconduct.

Regulations on solicitors' fees are set out in Chapter 4 of the Solicitors' Guide, the Solicitors (General) Costs Rules (Cap. 159G) and Part VI of the Legal Practitioners Ordinance.

There is no compulsory tariff system in Hong Kong. If a dispute arises on a solicitor's bill, the client can apply to have the bill taxed within one month of the delivery of the bill. The taxation is conducted by a taxing master and the solicitor's bill is taxed on an indemnity basis (that is, all costs are allowed except for those that were unreasonably incurred or of unreasonable amount).

For agreed fees, the solicitor must enter into a written agreement with the client covering the amount of fee and the scope of the work involved. The fee agreement must also state whether the agreed fee includes disbursement. The solicitor is bound by the agreed fees even if circumstances arise which make the work un-remunerative for the solicitor.

A contingency fee is prohibited in contentious proceedings in Hong Kong. Further, maintenance and champerty are unlawful in Hong Kong. Maintenance is the officious intermeddling with the disputes of others (without justification or excuse) by someone who has no interest in the action. Champerty is a form of maintenance where a person assists a litigant in return for a portion of the proceeds of the action.

Barristers' fees are charged as a disbursement in the solicitors' bill. The Bar Code requires that the fees for court attendance by a barrister must be agreed in advance. For other types of work, there is no requirement that a barrister must agree their fees in advance. The fees charged by a barrister depend on various factors including the complexity of the case and the seniority and experience of the barrister.

For litigation and contentious matters, it is common for solicitors to charge on a time costs basis (that is, the time spent by each solicitor multiplied by their agreed hourly rate). For non-contentious matters, solicitors can charge the client an agreed fee, on a time costs basis or a percentage basis.

A written fee agreement signed by the client and the solicitor is required for criminal matters, agreed fees and interim bills. Under the Solicitors' Guide, solicitors should prepare a retainer letter identifying the scope of service to be provided and the costs to be charged to avoid any potential dispute with the client, and the client should sign the letter in confirmation.

The holding of client funds is regulated by the Solicitors' Accounts Rules (Cap. 159F). One of the major principles under the Rules is that a solicitor must keep client's money separate from money belonging to the solicitor or their practice. A solicitor who holds or receives client's money must without delay pay the money into a client account.

The following are the main pieces of legislation in Hong Kong on money laundering:

The provisions under the DTRPO/OSCO/UNATMO in respect of, among other things, dealing with criminal proceeds, funding terrorist activities and suspicious transaction reporting, apply to every person in Hong Kong including the legal profession. For example, under section 25(1) of DTRPO/OSCO it is an offence for a person to deal with any property which they know or have reasonable grounds to believe to be (in whole or in part, directly or indirectly) proceeds of drug trafficking or an indictable offence. The maximum penalty for this offence is 14 years imprisonment and a fine of HKD5 million.

In addition, the Law Society has issued Practice Direction P "Guidelines on Anti-Money Laundering and Terrorist Financing". Any law firm or solicitor who fails to follow the mandatory elements of Practice Direction P can be subject to disciplinary proceedings. The mandatory requirements include rules on client identification and verification, client due diligence, record keeping and staff training.

Since 1 March 2018, the customer due diligence and record-keeping requirements of the AMLO apply to legal professionals. The AMLO enables the Law Society, as the sole authority for enforcing AMLO requirements for legal professionals, to have the discretion to promulgate guidelines and determine the content of Practice Direction P. Practice Direction P has been revised with effect from 1 September 2018 in light of the amendments to the AMLO.

In Hong Kong, notaries are generally required for authentication of documents for use in overseas (for example, real estate purchases overseas). However, in Hong Kong, notaries are not required for share purchases or transfers, real estate purchases or leases, or company formation.

Notary fees are fixed and they largely depend on the complexity of the matter.

In Hong Kong, all notaries are experienced solicitors who work in law firms.

The Hong Kong Society of Notaries is the regulatory body for notaries in Hong Kong.