The Hong Kong arms of the Big Four have got the rule of law wrong

By Michael Skapinker

Who would PwC, Deloitte, EY and KPMG prefer to appear before – China’s judges or Hong Kong’s?


The Hong Kong arms of the Big Four accountants, in their recent advertisement, attacked the pro-democracy Occupy Central movement, saying it could have a “negative and long-lasting impact on the rule of law”.

Lord Patten, the last British governor of Hong Kong,also expressed his fears about what was happening to the rule of law. In his view, it was not pro-democracy campaigners who threatened it but Beijing, with its recent “white paper”, which said that Hong Kong’s judges should be“patriotic”.

“Judges under the rule of law are independent and there shouldn’t be any question of them being instructed or pressed to subordinate their views of due process and what is legal to some other political considerations,” Lord Patten said.

Clearly, the Hong Kong arms of PwC, Deloitte,EY and KPMG – which received support from China’s ambassador to the UK – and Lord Patten don’t mean the same thing by the “rule of law”. What does it mean?

The most commonly-cited authority is AV Dicey in his Introduction to the Study of the Law of the Constitution, first published in 1885. To Dicey, the rule of law meant, first, “the absolute supremacy or predominance of regular law as opposed to the influence of arbitrary power”. It meant everyone should be equal before the law, including the government.

“The ‘rule of law’ . . . excludes the idea of any exemption of officials or others from the duty of obedience to the law which governs other citizens,” Dicey wrote.

The rule of law, in this sense, supports Lord Patten’s insistence that Hong Kong judges should be independent of any pressure from China’s government. It has little to do with the Big Four’s worry,expressed in their advertisement, that Occupy Central might disrupt “key large transactions and commercial activities”.

The accountants appear to be confusing the “rule of law” with “rule by law”, which, in the words of Jothie Rajah, of the American Bar Foundation, is “state-serving law”. The “rule of law” ensures the equal treatment of all; “rule by law” ensures orderly running of society under government control.

Some might object that this formulation of the rule of law is western and excessively individualistic – but it is widely admired around the world. When I praised Dicey’s version of the rule of law in a speech to a conference of the Law Society of England and Wales this week,attended by lawyers from countries, among others, in eastern Europe, Africa and Asia, the only dissent I heard was that an American might have added the separation of powers.

I don’t believe anyone, given a choice, would prefer to live in a society where you can be jailed or have your property confiscated on the say-so of an official rather than through due process of law.

Concurrent with the rule of law is citizens’ right to protest over and discuss how they are governed, as Hong Kong’s people have been doing in their debate about how to elect their chief executive.

The Hong Kong Big Four have every right to be alarmed if people plan to invade premises and disrupt business. That is a crime in any society. But if that were their concern, they should have combined it with a recognition that people do have the right to protest peacefully, as tens of thousands did in Hong Kong last week.

They should also have supported the independence of the judiciary as a cornerstone of citizens’ and companies’ security. But while they talked about a “law-based society” and called on people to “follow the law”, they had nothing to say, in their advertisement,about how law is made and judged.

It may be that they have accepted that China plans to exert greater control and that they would like to retain Beijing’s favour.

There are businesses in other parts of the world that make the same deal, that accept the protection of a government’s strong arm in return for the chance to make money without disturbance.

That is fine when things go well. Businesses need to think how they would fare if they did not. In China, GlaxoSmithKline officials have been accused of corruption. Hong Kong business leaders who wish Lord Patten and the democracy campaigners would pipe down should ask themselves this: if something similar happened to them, who would they prefer to appear before – China’s judges or Hong Kong’s?


Introduction to the study of the law of the constitution (1889)