RE AMBER AI LTD

HCCW 324/2026

[2026] HKCFI 4936

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) PROCEEDINGS NO 324 OF 2026

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REASONS FOR JUDGMENT

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I.  INTRODUCTION

1.  I dismissed the Petition at the hearing of 24 August 2026. Here are my reasons.

II.  THE COMPANY’S DEFENCES

2.  The Company, represented by Ms Natalie So leading Mr Leo Pang, submitted that there were two defences on which there are bona fide disputes on substantial grounds. The first was that the Consulting Agreement was a sham; the second was that the undertakings of non-competition and non-solicitation given by Mr Li (the sole shareholder and director of the Company) under the Mutual Separation Agreement (the “Undertakings”) had been breached so that no payment should be made to the Petitioner and/or Mr Li.

III.  DEFENCE OF SHAM

3.  For the defence of sham, although the parties to the Consulting Agreement were the Petitioner and the Company, the Company’s case was that it was a sham and the payments stated to be paid to the Petitioner were intended to be part of the termination payment paid to Mr Li for termination of his employment with the Company.

4.  To prove an allegation of sham, being a serious allegation, cogent evidence is required. In this evaluative assessment, I considered the following:-

(1)  This defence was not raised at the first opportunity but was raised only quite some time after the service of the Statutory Demand. This undermined the credibility of the defence.

(2)  The sham was allegedly to evade legal obligation such as obligation to pay tax. However, no evidence has been adduced to explain with more precise terms how such evasion would be achieved. This undermined the credibility of the defence.

(3)  In §3 of the general indorsement of the Writ of Summons in HCA 504/2026 (the “General Indorsement”) commenced by the Company against the Petitioner and Mr Li, the relief sought there for rescission and/or termination of the Consulting Agreement, or essentially a declaration of the invalidity of the Consulting Agreement due to lack of consideration, assumed the validity of the Consulting Agreement and/or did not mention anything about sham. This undermined the credibility of the defence. Further, raising an inconsistent allegation in court proceedings may constitute abuse of process.

(4)  The Company still made the payment in March 2026 despite the allegation that it discovered the breach of the Undertakings (to be explained below). However, the Company’s evidence was that the parties were negotiating and thus payment was still made in good faith. This in my view was neutral factor.

(5)  The Consulting Agreement was a retrospective agreement. It was retrospective in the sense that by the Consulting Agreement, the parties confirmed that the Petitioner had already provided services to the Company and its affiliates. This, in my view, appeared unusual, because in the normal course of business, there would be some agreement for services to be provided, and/or some invoices issued with a subsequent document to consolidate all the issued invoices.

(6)  While in its reply affirmation, namely, the 3^rd Affirmation of [Mr Li], Mr Li on behalf of the Petitioner, attempted to explain how the services were agreed to be provided, and what services under the Consulting Agreement were, in my view, it was inherently improbable that Mr Li as an employee of the Company, would have separately to incorporate the Petitioner to provide with the Company apparently the same or at least similar services which he himself as the employee was obligated to provide.

(7)  In any event, to explain the services stated in the Consulting Agreement, it was only in its reply affirmation that certain documents like the AM Agreement and the term sheet were produced. For the term sheet, it was not executed, but in the reply evidence, the Petitioner explained that it was due to internal delays and coordination issues, and said that the relevant parties carried out the term sheet eventually: see §10 of the 3^rd Affirmation of [Mr Li]. The Company simply had no chance to reply to such allegation, and any reply (even if the Company asked for a chance to reply) would, in my view, tend to suggest bona fide dispute. Similarly, in its reply evidence, the Petitioner said that the type of the structure for the services under the AM Agreement and the term sheet was “common in the asset management industry” and “commonly implemented through separate management and incentive or co-investment vehicles”: see §9 of the 3^rd Affirmation of [Mr Li]. This “common” practice, raised only in the reply evidence, also tended to suggest bona fide dispute.

(8)  The amount of the service fees, namely, USD 7 million, coincided with the amounts mentioned by Mr Li in his discussions with the Company for his termination. This lent force to the defence.

(9)  Although the Consulting Agreement and the Mutual Separation Agreement were two separate documents, they were executed at or around the same time. This was consistent with and supported the Company’s allegation that the Consulting Agreement was not a consulting agreement but actually part and parcel of the Mutual Separation Agreement. That said, I was aware of the Petitioner’s argument that the termination payment would be agreed to be paid to the Petitioner under the Consulting Agreement, and therefore, there would be no inconsistency with the Company’s allegation that they were part and parcel of the termination package. This may be right, but this would beg the question of why the Consulting Agreement would have to be framed as it was.

(10)  Raising the defence of sham here was a matter also against the Company itself. This lent some credibility to such allegation or effectively the Company’s own admission.

5.  I need not be satisfied that the Company’s defence will be established, but need only be satisfied that there was bona fide dispute on substantial grounds. Having considered the above, I was satisfied that there was bona fide dispute on substantial grounds in relation to the defence of sham.

6.  The Company submitted that in any event, the parties are bound by contractual estoppel are, with respect, besides the point. If, in the first place, the Consulting Agreement was really a sham, then no contractual estoppel could stand.

7.  The Company also submitted that irrespective of the true nature of the fees was, the Company had never disputed that it is payable. However, first, on the sham defence, the one who would be entitled to receive the fees would be Mr Li, not the Petitioner. Second, the Company also explained that it was no longer obliged to pay the fees because Mr Li has breached the Undertakings.

IV.  DEFENCE OF THE UNDERTAKINGS

8.  This second point takes me to the defence of the Undertakings. It was inherently probable, and consistent with the evidence adduced before me, that there were discussions on some restrictions on Mr Li’s competition and solicitation upon the termination of his employment with the Company. Given that the Consulting Agreement and the Mutual Separation Agreement were discussed and executed at or around the same time, there was in my view bona fide dispute that the payment under the Consulting Agreement would be intended to be linked to the Undertakings, or at least there would be sufficient mutuality for the purpose of resisting the Petition.

9.  While the Undertakings were restrictions on Mr Li but not the Petitioner, and thus, any breach would on the face of it led to Mr Li’s liability but not the Petitioner’s, however, if the defence of sham would be established, this would mean that the “fees” under the Consulting Agreement were actually payable to Mr Li, and thus breach of the Undertakings would reduce the “fees” payable under the Consulting Agreement, or at least there would be sufficient mutuality to resist the debt.

10.  Having considered the above, I am of the view that there was bona fide dispute on substantial grounds in relation to the defence of the Undertakings.

11.  For the sake of completeness, assuming that under the Consulting Agreement, the sham was that the service fees, though not any fee for services, was still intended to be payable to the Petitioner rather than Mr Li, then in my view there would be bona fide dispute on substantial ground over whether the breach of the Undertakings would be a ground for not making any further payment of “fees”, or at least there would be sufficient mutuality for the Company to resist the Petition. Viewed from this angle, there was also a bona fide dispute on substantial grounds in relation to the defence of the Undertakings.

 V.  CONCLUSION

12.  In the circumstances, I dismissed the Petition.

13.  The Petitioner was warned by the Companies Court on the last occasion that if the Petitioner would insist on proceeding with the Petition despite the Company’s evidence already filed on the last occasion, there may be costs on indemnity basis. However, at the hearing before me, Mr José-Antonio Maurellet SC leading Mr Danny Tang, counsel and Mr Tony Chow, (Solicitor Advocate), drew the Court’s attention (which was not done on the previous occasion) to §3 of the General Indorsement (see §4(3) above). On §3 of the General Indorsement, in my view, the Petitioner’s pursuit of the Petition was not so unreasonable as to warrant indemnity costs. Mr Maurellet also submitted that the defence of sham was raised only in the Company’s affirmation in opposition filed and served on 10 July 2026, and thus, any costs awarded to the Petitioner should only count from that day. Having considered the matter in the round, I think there should be no order as to costs until 9 July 2026 inclusive, and any costs incurred on and after 10 July 2026 shall be paid by the Petitioner to the Company with certificate for two counsel, to be summarily assessed on party-and-party basis. For the summary assessment, the Petitioner shall lodge and serve a statement of costs within 3 days from today, and the Company shall lodge and serve a list of objections within 3 days thereafter.

14.  I also order that costs of the Official Receiver in the sum of HK$6,500 shall be deducted from the deposit.

15.  Lastly, I thank Mr Maurellet, Mr Tang and Mr Chow, counsel for the Petitioner and Ms So and Mr Pang, counsel for the Company, for their able assistance.