Two recent HK High Court cases may have opened the door to relaxing HKs legislative restrictions on surrogacy and possibly formal law review and reform. The issue of criminal liability under s. 17 Human Reproduction Technology Ordinance Cap. 561 ("HRTO") was highlighted in detail in my two articles ("My Articles") published in 2018: the Lexis Nexis International Family Law Journal article, "Avoiding the cross hairs - criminal liability arising from surrogacy arrangements in Hong Kong and the UK" ([2018] 1FL 95), and in the Hong Kong Lawyer in May 2018, Complexities in Hong Kong Surrogacy Law. Unlike in other areas of family law, surrogacy legislation is uniform throughout the three legal jurisdictions in the UK.

Both cases were presided over by the Hon. Au-Yeung J:

FH v WB [2019] HKCFI 1748 ("FH") - judgment date 15 July 2019; and

A & B (Parental Order: s12 Parent and Child Ordinance (Cap.429)) [2019] HKCFI 1749 (the "A case") - judgment date 14 October 2019.

These are the first cases in which the issue of criminal liability under s. 17 has been fully recognised and addressed. As explained in My Articles, the only two reported surrogacy cases in HK up to the date of publication of those articles - D (Parental Order) [2014] HKEC 1948 and S v J (Surrogacy: Wardship) [2017] HKEC 1998 - had not done so, and the conflict between the criminal liability imposed by s. 17 HRTO on the one hand, and the authorising of expenses section under s. 12 of the Parent and Child Ordinance Cap. 429 ("PCO") on the other, remained (then) as a much-misunderstood trap. This is what I call the Authorisation of Expenses Trap ("AET"): in FH, the judge recognised for the first time the tension between s. 12 PCO and s. 17 in that connection.

In FH, the intended parent ("IP") parental order applicants, FH and MH, were married US citizens and HK permanent residents. They had been introduced to a surrogacy agency in California which, in turn, introduced them to WB and HB, a married couple, with whom they entered into a gestational carrier agreement with WB as the gestational carrier.

The California court declared the applicants genetic and legal parents of the twins and WB and her husband, HB, not to be legal parents of the twins. On the twins' birth certificates, issued in California, the applicants were recorded as their parents.

In mid-January 2018, FH made an application to renew the twins' dependent visas. In the course of answering the requisitions of the Director of Immigration (the "Director") through solicitors, FH disclosed to the Director that the twins were born out of a surrogacy arrangement and his intention to bring the application for a parental order.

The IPs did not know that they needed a HK parental order. Despite having taken California legal advice the court held that, FH only became aware of the need for a parental order after he received a letter from the Director on 20 February 2018 asking for, among other details, antenatal check documents and pregnancy photos of MH during her pregnancy with the twins and five family photos taken on the day of birth of the twins, and different periods thereafter."

FH then sought HK legal advice and discovered that, because the Californian orders were not recognised, a parental order was needed under HK law, regardless of the California position. He also was advised that it would be difficult to seek independent visas for the twins without first establishing parentage over them under HK law. And, crucially, without dependent visas or a parental order, the twins could not be enrolled into a kindergarten in HK.

The court highlighted the other consequences of not making a parental order (which are so often overlooked) and stressed that a parental order has the effect of strengthening the chance of a child born through surrogacy becoming a HK permanent resident. It referred to the UK case of In A v P [2012] Fam 188 in which that court described the consequences of not making the order:

The court found that, it is not in the best interests of a child that he be granted only a visitor's or dependent's visa while the commissioning parents have right of abode in HK. A parental order has the effect of strengthening the chance of the child becoming a HK permanent resident.

Mr FH and Mrs MH had two significant hurdles to overcome:

For both hurdles, the court found a pragmatic workaround.

Under s. 12(2) PCO

In order to obtain a parental order, PCO s. 12(2) requires married IPs to apply for a parental order, within six months of the birth of the child. The IPs were outside the six-month limit.

The court found that the six-month time limit in s. 12(2) PCO was not ambiguous, but strict adherence to it can lead to an absurdity: a child could have two sets of legal parents. the child will have no identityAt the same time, the surrogate mother may have given up, or, (as in the present case,) never had parental rights to the child in the jurisdiction where she has given birth.

The court found that, given the significance of a parental order, the Legislature could not have intended such consequences on the child who has not chosen the manner through which he came into this world, and the childs welfare is the first and paramount consideration.

It decided it had the power to extend the time, having regard to the welfare principle and principles of statutory interpretation, and applied the UK case of Re X (A Child) where the court extended the time limit. The welfare of a child prevails over his/her parents delay.

The court also decided there was further authority to extend the time by interpreting s. 12(2) in a way which was compatible with two other HK statutes:

Criminal Liability

Under s. 17 HRTO and the AET

Section 39 HRTO makes violation of s. 17 HRTO a criminal offence punishable with a fine of HK$25,000 and six months' imprisonment on first conviction. It is a summary offence, with a time limit of six months "from the time when the matter of such complaint or information respectively arose" for prosecution: s. 26 Magistrates Ordinance, Cap. 227.

It appears that the IPs did not know they might have committed a criminal offence in contravention of s. 17 HRTO because the court stated, it was on the court's own motion that HRTO was referred to - to ascertain what type of payments under surrogacy arrangements were regarded as illegal and to see if the Applicants ought to be referred to the Department of Justice for prosecution. As I stressed in my HK Lawyer article, there is no equivalent offence which incriminates IPs under UK law.

The court determined that an offence had been committed but that prosecution was time-barred because, this is a summary offence, with a time limit of six months from the time when the matter of such complaint or information respectively arose for prosecution: s26 of the Magistrates Ordinance, Cap. 227 and the IPs took part in negotiating with a view to making the gestational carrier agreement. They made payments on four occasions - on 24.12.2014, 30.4.2015, 27.10.2015 and 10.12.2015. Prosecution was plainly time-barred.

For the first time the court effectively recognised the AET situation - as a tension between s12 PCO and s17(1) HRTO:

The court refused to reinterpret/read down ss. 17 and 39 HRTO. It decided that, as prosecution was time-barred, it did not need to do so and after a rigorous review of the expenses paid, item by item, authorised all the expenses totalling US$108,198 (approximately HK$840,000).

The court heavily relied on a number of key factors in the case in making its final determination including that FH and MH had made no attempt to defraud the authorities (including the Director).

The court recognised that, The UK counterpart of s12(7) was the former s2(1) of the Surrogacy Arrangements Act 1985. That UK provision forbade commercial surrogacy but did not have the extra-territorial effect of s17 of HRTO. The judgment does not record that surrogate mothers and IPs in the UK do not commit an offence in the UK even if a payment (of the type that would be illegal under HK Law contrary to s. 17 HRTO) is made in the UK: whereas payments made by or to middle-men in the UK in such cases do. This is the reason why there is no discussion in UK cases as to whether or not IPs have committed a criminal offence.

The judge stated, that the mischief that HRT Bill targeted at was the commercialization of surrogacy which could give rise to abuse and the legislation was to penalize both the payor and payee. The intention of the Legislature was not to stop a married couple like the Applicants who had a genuine need to resort to surrogacy and used their own sperm and egg.

So the question was left open as to what would happen where there are IPs who have committed an offence contrary to s. 17 HRTO but where their offences have not yet been time barred. The judge stated that,any question on reading down HRTO should be left to a more appropriate case in future. But she did indicate that s. 12 PCO and ss. 2 and 17 of HRTO needed to be reviewed (see below).

In the A case, this was a similar scenario, but with a Mainland China connection, reaffirming most of the legal principles above. The Applicants were a married couple, and had lived in HK together since 2008. They were both permanent residents of HK. They entered into a surrogacy arrangement via a surrogacy agency in Mainland China, with E acting as the surrogate mother in a hospital using ovum from an anonymous female donor and sperm of A. The Applicants obtained Es consent to make an application for a parental order. As in FH, the Applicants were making the application out of time and there was an issue of the Applicants having contravened s. 17 HRTO. Again, that was dealt with by a direction that prosecution was time-barred, and all the expenses were then authorised after a thorough review.

FH is the lead judgment and the A case judgment cross-refers to FH, and vice-versa.

Urgent Need for Surrogacy Law Review and Reform

I have been calling for international regulation/reform of surrogacy law since 2002:

Since then, we have finally had the first welcome calls for review/reform of surrogacy law from the HK judiciary.

In FH, Au-Yeung J indicated that, s12 PCO and ss2 and 17 of HRTO are in need of review: If it is desired to control commercial surrogacy arrangements, those controls need to operate before the court process is initiated (ie at the border or even before): Re L (Commercial Surrogacy) [2010] EWHC 3146 (Fam), 10. Better still, the control should operate, if that be the intention of the Legislature, before the surrogacy arrangement was entered into. She also stated that, In May 2018, the UK government has requested the Law Commission of England and Wales and the Scottish Law Commission (The Commission) to review the laws concerning surrogacy. From both these comments and the general thrust of both her judgments it is reasonable to infer that the judge possibly might be indicating some support for the initial recommendations of The Commission of a Surrogacy Pathway - The new pathway to legal parenthood which involves pre-conception protocols and legal parentage for IPs from birth.

In the Court of Appeal, Zervos JJA, in HKSAR v Yeung Ho Nam [2019] HKCA 384 tackled the issue of discriminatory and unconstitutional HK legislation. Zervos JJA stated:

37. One of the fundamental core principles that bind us together as a society is that all are equal before the law. From this core principle flows the right that a person should not be discriminated against because of, amongst other things, gender or sexual orientation.

49. There needs to be a proper and effective review of the laws and policies that discriminate against same-sex relationships, which should not be left for the courts to ultimately resolve through lengthy legal proceedings....

50. There have been occasions where the courts have given jurisdiction to a party to mount a challenge against a law where there is a clear and apparent issue as to its constitutional validity. This was seen in the case of Leung v Secretary for Justice ... The Court made the point back then that if a law is unconstitutional, the sooner this is discovered the better, and that it was undesirable or prejudicial to force interested parties to adopt "a wait and see attitude" before dealing with a matter. The Court also noted that courts in HK are duty bound to enforce and interpret the Basic Law so that if any legislation infringes the Basic Law (or the Bill of Rights), that law must be held invalid.

By criminalising participation in commercial surrogacy arrangements, not just for commercial actors, but even for IPs, s. 17 has driven and continues to drive surrogacy arrangements underground. This creates a situation where children born through such arrangements are denied even the most basic protections of the law - including even a court order conferring parental locus on the IP or IPs.

The blanket exclusion of all same sex couples from accessing surrogacy services under s. 12 PCO is very arguably incompatible with the following constitutional rights: Article 25 (BL) states that all HK residents shall be equal before the law. And Article 22 (HKBOR) states that, All persons are equal before the law and are entitled without any discrimination to the equal protection of the law.

Insofar as a challenge to s. 17 HRTO is concerned, the court may also think it unlikely that a person directly affected by s. 17 will come forward, given that this would effectively mean risking a criminal prosecution in order to challenge the offence-creating provision. For IPs in such a situation they might well fit within Zervos JJs criteria above and, if so, it might well consequently be undesirable or prejudicial to force them to do so. It also might well be that in those cases that it should not be left for the courts to ultimately resolve them through lengthy legal proceedings.

Respectfully, if the Secretary of Justice decides to act on this powerful and much-needed call from the judiciary for a review of HK surrogacy law, and on its call to find a solution to deal with any discriminatory and unconstitutional legislation by avoiding costly court proceedings, consideration of the implementation of an HK Surrogacy Pathway - along the lines of the initial recommendations of The Commission - might possibly be a good place to start - involving pre-conception protocols and legal parentage for the IPs from birth. And for both heterosexual and same sex couples.

Go here to read the rest:
An update on the Complexities of Hong Kong Surrogacy Law. Parental Orders, Criminal Liability and the Authorisation of Expenses Trap in Hong Kong: Has...