Introduction

Letters of request are judicial mechanisms which enable the taking of evidence and/or the production of documents between jurisdictions in the form of a letter issued by a requesting court to a receiving foreign court. Outgoing letters of request are ordered by Hong Kong courts and sent abroad, and are derived from the courts' inherent jurisdiction. In contrast, the regime governing incoming letters is exclusively statutory and conferred by the Evidence Ordinance (Cap.8), introduced to give effect to the Convention on the Taking of Evidence Abroad in Civil or Commercial Matters, concluded at The Hague on 18 March 1970 (Hague Evidence Convention).¹

The Hague Evidence Convention establishes methods for providing testimonies and/or documents between signatory states in cases where evidence is sought from a different jurisdiction for use in proceedings. Whilst the Convention continues to apply as between Hong Kong and other contracting states, the Hague Evidence Convention ceased application between post-handover Hong Kong and the Mainland, as they are now parts of the same country. The Arrangement on Mutual Taking of Evidence in Civil and Commercial Matters between the Courts of the Mainland and the HKSAR (Mutual Arrangement) was later concluded in 2016 to achieve "an arrangement in line with the spirit" of the Hague Evidence Convention, providing for the "mutual taking of evidence in civil and commercial matters" under Article 6.²

The use of the letter of request procedure is thus essential for cross-border cases, falling within the implied powers of a court to enable the production of documents and evidence.³ However, what happens when the documents and evidence over which disclosure is sought are potentially subject to regulatory restrictions on their transfer out of the jurisdiction? The Court of Final Appeal has provided important guidance on this question in its recent decision in Tenwow International Holdings (in liquidation) v. PricewaterhouseCoopers [2025] HKCFA 17.

Background

The first plaintiff, Tenwow International Holdings Limited (P1), was an investment holding company incorporated in the Cayman Islands and listed in Hong Kong, which was wound up by the Cayman Islands court in March 2021. The second plaintiff, Nan Pu International Limited (P2) was incorporated in Hong Kong, a wholly-owned subsidiary of P1, and went into liquidation in June 2021.

The first defendant PricewaterhouseCoopers (D1) was the auditor for Tenwow from 2013 to 2017, while the second defendant PricewaterhouseCoopers Zhong Tian LLP (D2) was responsible for carrying out the audit work for Tenwow Group companies in the Mainland. D2 held various documents relating to the audits in question in its Shanghai office.

The plaintiff's liquidators alleged that the defendants were negligent in carrying out the audits of P1, which the defendants denied and contended that the audits were carried out with the care and skill of a reasonably competent auditor. This meant that the audit working papers were highly relevant as evidence to the court.

Before litigation commenced, P1 requested working papers from D1 for the engagements by the plaintiffs between 2013 and 2017. In May 2020, D1 responded that, as regards the relevant documents located in the Mainland, they were prevented as a matter of PRC law from disclosing them without permission from the Mainland regulators. In May 2023, the defendants proposed a joint application for a letter of request for the audit working papers documents to be transmitted to Hong Kong. This proposal was rejected by the plaintiffs. In November 2023, D2 received a letter from the Ministry of Finance, requiring it to comply with Mainland requirements.⁴

D1 proceeded to apply to the Court of First Instance for a letter of request to be issued by the Hong Kong courts to the Shanghai High People's Court (SHPC) for assistance so that D2 could produce the auditing working papers for the litigation in Hong Kong. The application was refused by the Court of First Instance, but this decision was later reversed by the Court of Appeal. The plaintiffs appealed and the matter was referred to the Court of Final Appeal (CFA).

There were two questions before the CFA. Firstly, does the Hong Kong Court's jurisdiction for issuing letters of request extend to securing production of documents by parties to the proceedings, where those documents are enumerated in a party's list of documents and prohibited from production without requisite approval? Secondly, does a request for a Mainland court to facilitate regulatory approval for producing documents in Hong Kong proceedings as part of general discovery fall within the scope of Article 6 of the Mutual Arrangement?

Decision on the first ground of appeal

The appellants argued that it was wrong in principle for the Hong Kong courts to issue a letter of request for the purposes of general discovery as this fell outside the courts' inherent jurisdiction. It was argued that an outgoing letter of request may not be issued unless it is for the purpose of obtaining material and admissible "evidence" within the meaning of s.76(3) of the Evidence Ordinance.⁵The working papers which were the subject of the appeal were not directly material to an issue in the litigation and therefore did not constitute "evidence" within the meaning of the Evidence Ordinance.⁶By virtue of the "equivalence" principle (i.e. that the courts should not make an outgoing request in circumstances in which, had it been incoming, it would not be given effect to), the plaintiffs submitted that the limitations on outgoing letters of request should also be applied to incoming letters of request.⁷

The CFA rejected the appellants' position that the Hong Kong courts' inherent jurisdiction should be limited to preclude the issue of letters of request in the present case, for the following reasons:

• The court's inherent jurisdiction is necessarily broad and flexible in order to meet the needs of justice. Against this important context, the CFA noted that the audit working papers were relied upon by D2 extensively in defence of the professional negligence claim against it. The documents were therefore critical to the determination of the underlying subject matter of the litigation.⁸
• The equivalence principle advanced by the appellants should be rejected. Whilst there were clearly limits on the issue of a letter of request common to both outgoing and incoming requests, to elevate these common limits to a principle requiring equivalence in all respects was to overstate the position and would be inconsistent with the Charman v. Charman decision relied upon by the appellants.⁹Furthermore, the "do unto others" approach was not a rule of law nor one that demanded symmetry, particularly where it had been established by evidence that a foreign court is the appropriate channel by which to seek the necessary approval.
• The outgoing letter of request would not be a subjugation of the Hong Kong court's power to regulate discovery procedures to the Mainland court. PwC ZT was bound to comply with its own discovery obligations and the letter of request did not act as a substitute for these obligations.

Decision on the second ground of appeal

The appellants argued that the request for a Mainland court to facilitate regulatory approval for producing documents in Hong Kong proceedings does not fall within the scope of Article 6 of the Mutual Arrangement. The appellants submitted that a letter of request for the working papers concerned was in the nature of general discovery and therefore outside the scope of the meaning of "evidence" under Article 6, where the meaning of the word "evidence" should be guided by its meaning in the context of the Hague Evidence Convention. The appellants referred to the fact that the PRC had made a declaration pursuant to Article 23 of the Hague Evidence Convention that it would execute letters of request for the discovery of documents only if the documents were clearly enumerated and of direct and close connection with the subject-matter of the litigation.¹⁰

The CFA did not accept the appellants' arguments and affirmed the decision of the Court of Appeal that a letter of request fell within the terms of the Mutual Arrangement. The CFA stated the following reasons in support of its decision:

• The Mutual Arrangement is not a statute and lacks the force of law, and the courts should therefore not approach its interpretation in an unduly strict or formalistic manner. Its text is broad and permissive, and its purpose is to promote judicial cooperation between the Mainland courts and those of the HKSAR.¹¹
• The difference under Article 6 in the wording of the scope of assistance that may be requested by the Mainland courts to Hong Kong courts versus that of the Hong Kong courts to the Mainland courts is to be expected in light of the different legal systems in operation in the Mainland and Hong Kong. The phrase "provision of documentary evidence" as stated in the Mutual Arrangement should not be treated as equivalent in its meaning to s.76(3) of the Evidence Ordinance.¹²
• The appellants' reliance on the PRC's declaration in accordance with Article 23 of the Hague Convention did not affect this conclusion. That declaration was made in the context of general discovery, in contrast to the present case concerning a different situation where a party's own documents had been clearly enumerated and identified in its list of documents but had been subject to a prohibition against production without approval under the law of the place where they were located.¹³
• The Court of Appeal had found, in relation to Mainland law, that there was no blanket prohibition on the removal of audit working papers unless they involved state secrets, national security or significant public interest. Therefore, once there is "reason to suppose the Mainland court would be receptive to the request", the Hong Kong courts should consider factors which are within their discretion, to determine whether the application for the letter of request should be supported or refused.¹⁴

Commentary

The CFA's judgment affirms the powers of the Hong Kong courts to issue outgoing letters of request as a valid method of addressing regulatory barriers to the disclosure of material evidence in cross-border proceedings. The judgment also illustrates the Hong Kong courts' pragmatic, cooperative approach in facilitating the judicial cooperation between the Mainland and Hong Kong.

The judgment is welcome guidance for litigation and insolvency practitioners who are navigating the potential transfer of material documentary evidence out of the Mainland in light of the evolving regulatory framework across areas including state secrets laws, cybersecurity and data protection. One expects, in light of the CFA's decision, to observe the greater use of letters of request in cross-border disputes, especially where Mainland documents are critical to the outcome of Hong Kong litigation.

It should be noted that, after the appeal hearing in the instant case, a letter from the SHPC was provided to the CFA, which declined the order to produce documents and returned the letter of request to the Hong Kong court. However, the CFA observed that the SHPC's decision was based on the audit working papers not yet being cleared for export by the relevant Mainland regulatory authorities and that, were such approval forthcoming, the implication from the SHPC was that it would implement the Mutual Arrangement in response to a fresh letter of request.¹⁵

The CFA acknowledged that, as a matter of practicality, upon the matter being returned to the trial judge, the trial judge might take the view that an adjournment of the trial was necessary in order to afford the parties a realistic opportunity to seek the necessary Mainland approvals with a view to securing the transfer of the audit working paper to Hong Kong.¹⁶ The CFA's commentary, in this respect, underlines the importance of careful case management by the courts of Hong Kong, amidst an area of regulatory complexity, in order to facilitate the just resolution of disputes.

Acknowledgements to interns Bill Lam and Timothy Cheng for research and contribution to this article.

1. [2025] HKCFA 17 at [27]
2. Ibid [58]
3. Ibid [40]
4. Ibid [14]
5. Ibid [30]-[31]
6. The appellants cited, in support of their position, the House of Lords’ decision in Rio Tinto Zinc Corporation v. Westinghouse Electric Corporation [1978] AC 547 at 619F, where Viscount Dilhorne held that the word “evidence” in the equivalent statutory provision in the Evidence Act 1975 was to be interpreted in the same way as the word “testimony” had been interpreted in the Foreign Tribunals Evidence Act 1856, namely as “direct evidence for use at a trial as contrasted with information which may lead to the discovery of evidence”: see Radio Corporation of America v. Rauland Corporation [1956] 1 QB 618 at 646
7. In advancing the equivalence principle, the appellants cited and relied on Panayiotou v. Sony Music Entertainment (UK) Ltd. [1994] Ch 142 and Charman v. Charman [2006] 1 WLR 1053. In Charman, Wilson LJ (as he then was) said: “It would be unconscionable for the English court to make an outgoing request in circumstances in which, had it been incoming, it would not give effect to it; nor could the foreign court reasonably be expected to give effect to the English court’s request in such circumstances. ‘Do unto others as you would be done by’, as Lord Denning M.R. reminded us, in this context albeit obiter, in Rio Tinto Zinc Corporation v. Westinghouse Electric Corporation [1978] A.C. 547 at 560H.”
8. Ibid [39], [46]-[47]
9. The CFA noted that the English Court of Appeal rejected the existence of a limitation that an outgoing letter of request could not be issued in matrimonial financial relief proceedings because the documents sought could not at that stage be proved to exist. Ibid [52]
10. Ibid [66]-[68]
11. Ibid [75]
12. Ibid
13. Ibid [76]
14. Ibid [78], [80]
15. Ibid [91]-[101]
16. Ibid [104]