The Department of Justice's major policy objective is to develop Hong Kong as a regional legal services and arbitration centre.

Deputy Solicitor-General Stephen Wong said this at a Legislative Council (LegCo) panel meeting yesterday, assuring legislators that a lot of work had already been done over the past two years to achieve this goal.

Hong Kong and mainland authorities worked out an arrangement for reciprocal enforcement of arbitral awards according to Article 95 of the Basic law in June 1999.

Between February 2000, when the arrangement came into effect, and September this year, Hong Kong had received 71 applications for enforcement of mainland arbitral awards.

Wong informed the LegCo panel on administration of justice and legal services: "As the awards in Hong Kong can be enforced on the mainland too, the arrangement will encourage mainland enterprises and foreign investors to employ arbitration services in Hong Kong.

"This in turn will strengthen Hong Kong's role as a regional dispute resolution centre."

The Department of Justice formed a working group in September 2005 to review Hong Kong's arbitration law after receiving some complaints that it was too complicated.

After about 30 meetings, the working group will prepare a draft bill and consultation paper next year, he said. They will serve as the basis of the new legislation.

On mediation services, he said the government would actively provide these in the building and insurance sectors as well as family and employees compensation disputes.

"The best result of mediations is not having any winners or losers. By not going to court, the parties save a lot of money and time and get a mutually acceptable result," Wong said.

"With this direction in mind, we will suggest legal aid be granted to applicants for mediation services too," he added.

In accordance with phase II of the Closer Economic Partnership Arrangement (CEPA), Hong Kong lawyers can provide professional services if requested by mainland law firms to do so without the need to apply for a legal permit.

Under CEPA IV, signed in June this year, Hong Kong barristers can act as agents (in the capacity of citizens) in civil litigation cases on the mainland.

But panel member Martin Lee and Bar Association representative Anthony Ismail both wanted to know what "agents" mean, and if "citizens" can demand fees from their "clients".

Wong replied that he had written to the mainland judicial authorities in September seeking clarification on the terms and the relevant rules.

The mainland authorities have not yet answered, but Wong was sure they were working on the details.