How to Structure Offshore Companies for Arbitration in Asia

Most cross-border deals in Asia live or die on two things: where disputes are heard and where assets sit when disputes erupt. If you’ve ever tried to enforce a judgment in a jurisdiction that doesn’t recognize it—or against an entity that owns nothing—you know the pain. Structuring offshore companies with arbitration in mind isn’t just legal housekeeping; it’s a front-loaded enforcement strategy. Below is a practical roadmap drawn from deal tables and hearing rooms across Singapore, Hong Kong, and the major offshore jurisdictions.

Why arbitration drives offshore structuring in Asia

Arbitration is the default for serious Asia deals because it solves three persistent problems: cross-border enforceability, neutral decision-makers, and effective interim relief.

• Enforceability: Awards are enforceable across most of the world thanks to the New York Convention (over 170 contracting states). Courts in New York, Singapore, Seoul, Jakarta, and Mumbai will all generally honor a properly rendered award.

• Neutral forums: Parties don’t want to fight in a counterparty’s home courts. A neutral seat like Singapore or Hong Kong eliminates that fight before it starts.

• Interim measures: Modern arbitral rules and supportive courts allow parties to freeze assets, preserve evidence, and stop rogue transactions quickly.

Institutions such as SIAC and HKIAC consistently report several hundred new cases per year, with a dominant share of international disputes. In practice, that means mainstream judges and arbitrators are familiar with the playbook for Asia deals, shareholder fights, and enforcement against offshore vehicles.

Map the dispute profile before picking a jurisdiction

The right structure depends on the disputes you are likely to face, where the value sits, and who your counterparty is. I often start with three questions:

• What is the likely dispute type?

• Shareholder and JV disputes (deadlocks, management control, oppression/unfair prejudice)

• M&A price adjustments and earn-outs

• Supply chain/long-term offtake and logistics

• Technology licensing and IP

• Project delays and construction claims

• Where are the assets you may need to grab?

• Bank accounts in Hong Kong or Singapore

• Equity in BVI/Cayman holding companies

• Onshore assets in Mainland China, India, Indonesia, or Vietnam

• Who is the counterparty?

• PRC SOEs and private groups

• Indian promoter-led companies

• Regional conglomerates with layered SPVs

• Funds, sovereigns, or development banks

Your offshore structure should line up with the dispute map: seat selection that facilitates interim protection, an arbitral clause that binds the right entities, and asset placement where awards can be enforced quickly.

Choosing the arbitration seat: Singapore, Hong Kong, or elsewhere?

The seat determines the procedural law, the supervising court, and the practical tools you can use. For most Asia deals, Singapore and Hong Kong are the workhorses.

• Singapore

• Pro-enforcement judiciary with a long track record of supporting arbitration.

• Emergency arbitrator orders are enforceable.

• Courts routinely grant injunctions and asset-freeze orders in support of arbitration.

• Familiar to Indian, ASEAN, and global parties; efficient hearings and low intervention.

• Hong Kong

• Sophisticated commercial bench; strongly supportive of arbitration.

• Unique advantage: a 2019 arrangement allows Mainland Chinese courts to grant interim measures (asset freezes, evidence preservation) in support of Hong Kong-seated arbitrations administered by designated Hong Kong institutions (including HKIAC). This is a game-changer if material assets are in Mainland China.

• Emergency arbitrator orders are recognized, and courts provide robust interim support.

• When to consider London or Paris

• If you need English or French law supervision, or a treaty framework for state-related projects.

• Useful for global commodity trades or where the parties want distance from Asia courts.

A quick rule of thumb:

• If your enforcement targets are mainly in Mainland China, a Hong Kong seat unlocks Mainland interim relief.

• If your counterparties or assets are spread across India and Southeast Asia, Singapore tends to be faster and more predictable.

• If the transaction involves state entities or specialized sectors (energy, defense), London or Paris may deliver broader comfort to all sides.

Selecting the offshore holding jurisdiction

The SPV is your enforcement chess piece. The typical choices in Asia deals are BVI and Cayman, sometimes paired with mid-tier substance in Hong Kong or Singapore.

• British Virgin Islands (BVI)

• Flexible corporate law and quick incorporations.

• Arbitration-friendly courts; stays available for arbitrable issues.

• Insolvency and winding-up proceedings are not arbitrable; courts retain control.

• Popular for holding PRC or ASEAN businesses because share charges and transfers are straightforward.

• Cayman Islands

• Standard for funds and larger holding structures.

• Courts respect arbitration but keep jurisdiction over winding-up and just-and-equitable petitions.

• Clean, predictable share pledge and security regime; widely accepted by lenders.

• Hong Kong or Singapore companies

• Useful as midcos for substance (board meetings, staff, accounting).

• Easier banking and operational oversight.

• Arbitration clauses in corporate documents are well understood and enforced.

• Other options

• Labuan for Malaysia-focused structures.

• ADGM/DIFC for MENA-Asia deals—excellent courts and arbitration support, but think carefully about counterparty preferences and enforcement points.

What actually matters:

• Where the shares are registered and how quickly they can be transferred or charged.

• How quickly you can replace directors or block a transaction in a crisis.

• Whether the courts will stay satellite litigation in favor of arbitration when appropriate.

• Whether the SPV will pass emerging economic substance tests (more on this below).

Drafting arbitration-ready corporate documents

If your arbitration clause only lives in the share purchase agreement, you’ve already lost half the battle. You need alignment across the suite:

• Shareholders’ agreement (SHA)

• Articles/constitutional documents

• Subscription and investment agreements

• Convertible notes/SAFE/loan agreements

• Security and guarantee documents

• Key commercial contracts (e.g., supply, license, services)

Core drafting points:

• Seat and rules: Choose a seat (Singapore or Hong Kong are safe defaults) and an institution (SIAC or HKIAC). Avoid ad hoc clauses unless you know exactly why you want them.

• Governing law: Specify the law of the main contract and—critically—the law of the arbitration agreement itself. Don’t leave this to implication. English law, Singapore law, or Hong Kong law are common choices.

• Tribunal: Single arbitrator for smaller deals/low value; three for high-stakes or complex matters.

• Language: Specify, usually English.

• Confidentiality: Include explicit confidentiality obligations, especially for shareholder disputes. Rules help, but a tailored clause avoids gaps.

• Joinder and consolidation: Give the tribunal the power to join affiliates and consolidate related arbitrations; make sure institutional rules support it.

• Service of notices: Specify email addresses and physical addresses; designate an agent for service if parties are in harder-to-serve jurisdictions.

Shareholder-specific mechanics that reduce disputes

• Deadlock clauses: Define trigger events and include a stepwise path (board negotiation, senior executive meeting, mediation window, then arbitration). Couple deadlock with buy-sell mechanisms.

• Valuation disputes: Decide whether valuation goes to an expert or arbitrator. If you pick an expert, draft an “expert determination” clause with finality language and a thin scope of challenge; if you pick arbitration, define valuation methodologies and disclosure obligations.

• Share transfer controls: Tag/drag, ROFR, and lock-ups need clear processes and timelines. Allow tribunals to order specific performance of transfer obligations.

• Director appointment and removal: Empower interim relief—tribunals and courts—to maintain status quo, restrain boardroom ambushes, or compel meetings.

Carve-outs and non-arbitrable issues

Some matters belong to courts:

• Insolvency, winding-up, and statutory unfair prejudice/just-and-equitable petitions (BVI/Cayman typically keep these in court).

• Regulatory approvals or filings (competition, foreign investment, sectoral regulators).

• Notarization or registries (share charges, pledges, or title transfers that require public act).

In practice, carve-out language should be tight: let courts handle only what they must, and send everything else to arbitration. A common mistake is a broad “courts have exclusive jurisdiction” clause buried in the articles that undermines the arbitration framework.

Multi-party and group structures: make sure the right entities are bound

Disputes often involve non-signatories: parent guarantors, operating subsidiaries, and founders. Close the loop early.

• Bind affiliates: Make key affiliates sign the SHA and other core contracts containing the arbitration clause. Where signature isn’t possible, include “deemed affiliate” joinder obligations triggered by receiving benefits.

• Guarantees: Backstop SPVs with parent guarantees governed by the same law and arbitration clause. Lenders expect this; equity investors should, too.

• Side letters and options: Don’t let side letters fall through the cracks. Duplicate the arbitration clause verbatim.

• Group of companies doctrine: Some tribunals extend arbitration clauses to non-signatories based on conduct and common control. Count on it only as a last resort; it’s uneven across jurisdictions.

Interim measures strategy: front-load your protection

The ability to freeze assets or stop a rogue board meeting can decide a case before it starts.

• Emergency arbitrators

• SIAC and HKIAC both offer emergency relief procedures. Applications can be decided within days, sometimes hours.

• Singapore and Hong Kong courts can enforce emergency orders or recognize them as tribunal orders.

• Court-ordered interim measures in support of arbitration

• Singapore courts are responsive to injunctions and asset freezes in support of foreign and domestic arbitrations.

• Hong Kong’s unique advantage: Mainland Chinese courts can grant interim measures in support of Hong Kong-seated arbitrations under the 2019 arrangement with designated Hong Kong institutions. If your counterparty’s key assets are in Mainland China, this feature is a decisive factor.

• India permits interim measures through courts even for foreign-seated arbitrations in many scenarios. In practice, Section 9 applications are common in Singapore-seated disputes involving Indian parties.

• Drafting for interim relief

• Include explicit language authorizing tribunals to grant interim relief and specific performance.

• Provide for emergency arbitrator recourse.

• State that parties may seek court interim relief without waiving arbitration.

From experience, the best time to think about injunctions is before the deal signs. For example, if your counterparty’s receivables flow through a Hong Kong account, structure the contract to keep that routing stable and visible; it’s easier to freeze a known account than to chase scattered flows.

Enforcement planning from day one

Arbitration only works if the award can bite.

• Place assets where enforcement is predictable: bank accounts and shares in Hong Kong or Singapore; shares of BVI/Cayman holdcos; receivables from counterparties in New York, London, or other New York Convention jurisdictions.

• Build security at signing: share charges, account charges, or escrow structures. Even equity deals can include conditional charges to be activated upon breach.

• Parent guarantees: A simple guarantee from a creditworthy parent is often the cheapest insurance policy in cross-border deals.

• Avoid the empty-pocket SPV problem: If your only award debtor is a shell, you’re bargaining from weakness. Push for cross-guarantees or periodic minimum cash covenants at the SPV.

• Mainland China enforcement: PRC courts enforce foreign awards under the New York Convention, but interim measures are easier via the Hong Kong arrangement. If Mainland assets are key, the Hong Kong seat plus HKIAC administration is your best friend.

• Southeast Asia enforcement: Indonesia and Vietnam enforce awards, but timelines and public policy objections can be unpredictable. Counterweight with assets in Singapore or Hong Kong.

A practical tactic I’ve seen pay off: require an opco to maintain its main revenue accounts in a New York Convention jurisdiction with a reliable enforcement track record. It sounds mundane, but awards enforce faster against cash than against plant and equipment.

Tax, substance, and compliance that affect arbitration

Structuring for arbitration intersects with tax and regulatory compliance more than people realize.

• Economic substance rules (BVI/Cayman)

• If your SPV is conducting “relevant activities,” it needs adequate substance: local directors, board minutes, and decision-making in the jurisdiction.

• Substance isn’t just tax hygiene; it creates contemporaneous records—meeting minutes, resolutions—that often win cases. Tribunals take well-kept board packs seriously.

• CRS/FATCA

• Automatic information exchange means your counterparty’s offshore cash trails may become discoverable sources. In a damages phase, bank statements and CRS data can help reconstruct value flows.

• Transfer pricing and intercompany agreements

• Clean intercompany pricing documentation reduces room for inflated claims or defenses. It also makes damages models more credible.

• Data laws

• PRC PIPL and localization rules can slow evidence gathering. Plan for data transfer assessments and anonymization protocols before disputes arise. Your arbitration clause can require cooperation in evidence preservation to meet local law constraints.

• Sanctions and KYC

• Sanctions risk can derail payment mechanics or bank accounts. Seats like Singapore and Hong Kong offer more pragmatic pathways than some Western venues when counterparties sit near sanctions lists, but you still need clean payment routes and alternative currencies identified upfront.

Funding, costs, and budgeting

Arbitration costs vary widely but planning beats surprises.

• Third-party funding

• Permitted for international arbitration in Singapore and for arbitration in Hong Kong, subject to disclosure rules. For cash-constrained claimants, this can shift risk and provide leverage.

• Cost allocation and efficiency tools

• SIAC/HKIAC tribunals routinely award costs to the prevailing party. Well-behaved procedure often pays.

• Early dismissal/summary procedures are available under modern rules; deploy them against unmeritorious counterclaims.

• Rough numbers

• For a USD 10–50 million claim, expect institutional and tribunal fees in the mid six to low seven figures combined. Counsel fees can match or exceed that depending on complexity. Median time to a final award in well-managed cases tends to be 12–18 months, with emergency orders available in days.

Sector-specific structuring notes

• Energy and infrastructure

• Stabilization and change-in-law clauses belong in the main contract and should be arbitrable. Pair with political risk insurance notices and step-in rights.

• Consider a BIT-eligible holding company if state action risk is meaningful. Some investors use Hong Kong, Singapore, the Netherlands, or the UK as treaty platforms—but check treaty status; several Asian states have updated or terminated older BITs.

• Technology and venture capital

• Convertible instruments need clear triggers for conversion and repayment, with arbitration covering disputes over capitalization tables and anti-dilution math.

• Board control fights are common; interim orders to restrain issuances or convene meetings are essential. Tribunals in Singapore and Hong Kong are quick to act if the clause is tight.

• Manufacturing and supply chains

• Long-term offtake and pricing indices benefit from expert determination for narrow pricing issues and arbitration for broader breaches. Make that split explicit.

A step-by-step blueprint to structure for arbitration

• Map the dispute and asset landscape.

• Identify likely disputes and where enforcement will matter most.

• Choose your arbitration seat and institution with purpose.

• Singapore for regional neutrality and broad court support; Hong Kong for the Mainland interim measures advantage; London/Paris for state-heavy deals.

• Select your holding jurisdiction with enforcement in mind.

• BVI or Cayman for the holdco; consider a Hong Kong or Singapore midco for substance and banking.

• Decide governing laws.

• Pick the law for contracts, corporate documents, and—explicitly—the arbitration agreement.

• Draft a robust arbitration clause.

• Seat, rules, tribunal size, language, confidentiality, joinder/consolidation, emergency relief, and court-interim carve-ins.

• Embed the clause everywhere it matters.

• SHA, articles, debt and security documents, guarantees, side letters, and key commercial contracts.

• Bind the right parties.

• Make affiliates sign or commit to joinder; align guarantors and security providers on the same clause and seat.

• Lock in interim protection.

• Emergency arbitrator language; recognition of court interim relief; specify service addresses and agent for service.

• Place and secure assets thoughtfully.

• Maintain accounts and shares in enforcement-friendly jurisdictions; build share charges and escrow mechanics.

• Address substance and compliance.

• Ensure corporate governance and board processes create clean records; address CRS/PIPL; line up transfer pricing documentation.

• Budget and consider funding.

• Sanity-check costs; explore funding if recovery prospects are strong but cash is tight.

• Rehearse enforcement.

• Prepare a playbook for freezing orders in the seat court and in key asset jurisdictions; identify counsel and timelines in advance.

Common mistakes and how to avoid them

• Pathological clauses

• Example: “Any dispute shall be finally settled by SIAC in Hong Kong under English law courts.” That’s not a joke; I’ve seen worse. Use tested model clauses and then tailor.

• Seat–rules mismatch

• Choosing a seat that doesn’t align with the institution or your target asset jurisdictions. As a simple check: If you need Mainland interim measures, don’t seat in Singapore; pick Hong Kong and an eligible Hong Kong-administered arbitration.

• Forgetting the arbitration agreement’s governing law

• Tribunals and courts have different default rules. Avoid interpretive fights by naming the law that governs the arbitration agreement.

• Missing non-signatories

• The subsidiary holding the plant, the founder who controls the board, or the parent with the cash are often not parties to the arbitration clause. Pull them in at contract stage.

• Conflicting clauses across the document suite

• One contract with arbitration, another with court jurisdiction. Harmonize or include a cascade rule that gives primacy to the arbitration clause.

• Overbroad carve-outs

• Carving out “urgent relief” to courts without guardrails invites forum shopping. Keep carve-outs narrow and clearly defined.

• Neglecting evidence and data transfer planning

• PRC and other data regimes can slow disclosure. Negotiate evidence cooperation and lawful transfer protocols upfront.

• Empty SPVs and no guarantees

• Awards against entities with no assets waste time. Get parent guarantees or asset security early.

Practical examples that illustrate the stakes

• Mainland assets? Pick Hong Kong.

• A consortium invested via a Cayman holdco into a PRC logistics group. The SHA used HKIAC rules with a Hong Kong seat. When a control fight broke out, the investors obtained Mainland court asset preservation orders under the Hong Kong–Mainland arrangement within weeks—freezing key bank accounts before funds could be swept.

• Indian JV? Build in Singapore + Section 9 backup.

• A Singapore-seated SIAC clause governed a JV with operations in India. When one party tried to dilute the other through a surprise share issue, an emergency arbitrator granted a status quo order within days. Counsel then secured a parallel interim injunction from an Indian court to reinforce the order onshore.

• BVI holdco? Use security early.

• In a Southeast Asia roll-up, the buyer took a share charge over the BVI parent of the opco group. When earn-out disputes arose, the charge and a quick interim order at the seat preserved the shares and prevented a value-draining transfer.

Model clause you can adapt

Use this as a baseline and tailor to your deal:

• Arbitration agreement:

• Any dispute, controversy, or claim arising out of or in connection with this agreement (including any question regarding its existence, validity, interpretation, performance, breach, or termination) shall be referred to and finally resolved by arbitration administered by [SIAC/HKIAC].

• The seat of arbitration shall be [Singapore/Hong Kong].

• The tribunal shall consist of [one/three] arbitrator[s].

• The language of the arbitration shall be English.

• The governing law of this agreement shall be [e.g., Singapore law]. The governing law of the arbitration agreement contained in this clause shall be [e.g., English law/Singapore law/Hong Kong law].

• The parties agree that applications for urgent interim or conservatory measures may be made to the courts of the seat or any competent court, without waiver of this arbitration agreement.

• The parties consent to the appointment of an emergency arbitrator and agree that any emergency decision shall be binding and enforceable.

• The tribunal shall have the power to order specific performance, injunctive relief, and measures for the preservation of assets and evidence.

• Subject to any mandatory legal duty of disclosure, the arbitration and all related proceedings and filings shall be confidential.

• The parties agree that the tribunal may permit joinder of affiliates and consolidation of related arbitrations arising out of the same transaction or series of transactions.

For shareholder arrangements, add:

• This clause binds and is intended to be enforceable by each party’s affiliates that receive any benefit under this agreement. The parties shall procure that such affiliates accede to this arbitration agreement if requested by any party.

And in your corporate documents:

• Mirror the arbitration clause in the articles to cover intra-member disputes, with a narrow carve-out for statutory winding-up and regulatory matters.

Red flags checklist before closing

• Seat and rules picked for a clear reason, documented in the term sheet.

• Arbitration agreement’s governing law stated explicitly.

• Clause mirrored across SHA, articles, debt/security, guarantees, and side letters.

• Affiliates and guarantors signed up or contractually required to accede.

• Emergency arbitrator and interim relief language included.

• Confidentiality spelled out and aligned with data-transfer and evidence protocols.

• Joinder and consolidation powers granted to the tribunal.

• Service mechanics: named email and physical addresses; agent for service where needed.

• Assets mapped and secured: share charges, bank accounts in enforceable jurisdictions, escrow if appropriate.

• Substance and governance: board processes in place; minutes and approvals to be maintained in the designated jurisdiction.

• Funding and budget plan ready; consider insurance for political risk if relevant.

What I’ve learned from doing this repeatedly

The cleanest arbitrations were won before they began—by choosing a seat with leverage, aligning the clause across documents, and placing assets within reach. Hong Kong’s interim measures link to Mainland courts remains underused by non-Chinese investors; if your value sits in Mainland China, it’s a standout advantage. In India-heavy deals, Singapore’s ecosystem and the willingness of Indian courts to support interim relief complement each other well. And in almost every shareholder fight I’ve seen, the side with stronger documentation—board minutes, notices, valuation procedures—owns the narrative.

Get the structure right, and arbitration becomes a sharp, reliable tool rather than a long bet. That’s the difference between spending 18 months chasing paper and spending a few weeks freezing the right accounts, nudging your counterparty to the table, and getting paid.