In May 2025, China launched the International Organization for Mediation (IOMed) in Hong Kong, branding it as an alternative to Western dispute resolution forums like the International Centre for Settlement of Investment Disputes (ICSID). While analysts have focused on its legal structure and geopolitical goals, less attention has been paid to what the strategic choice of the location of its headquarters signals. Once a semi-autonomous Special Administrative Region (SAR) with a globally recognized independent judiciary, the city’s legal system has since been reshaped by the introduction of the National Security Law in 2020, which criminalizes dissent and consolidates authority. Although IOMed may appeal to states in the Global South that are frustrated with existing Western institutions, its opaque structure and close alignment with Beijing raise questions about its credibility. Beyond establishing an alternative legal order, IOMed reflects Beijing’s broader efforts to rebrand Hong Kong on the international stage, without undoing the repression that necessitated the re-narrativizing in the first place.

Hong Kong: No Longer the Political Exception It Once Was

Since the return of Hong Kong’s sovereignty to China in 1997, the Special Administrative Region (SAR) has become more than just a global financial hub; it has also been a political exception within an otherwise authoritarian regime. Under the “One Country, Two Systems” framework, Hong Kong was promised a high degree of autonomy, with its legal system, independent judiciary, and civil liberties, rights not granted to citizens in mainland China. This arrangement allowed Hong Kong to flourish as a cosmopolitan city governed by the rule of law, where international norms coexisted with Chinese sovereignty. 

However, that perception was shattered after 2019, when the government proposed an extradition bill that would have allowed suspects to be sent to mainland China for trial. The proposal ignited massive pro-democracy protests, with millions fearing that the legislation marked the beginning of the end for whatever is left of Hong Kong’s self-rule. The government’s response was swift, with the sweeping crackdown on dissent, followed by the imposition of the National Security Law (NSL) in 2020. Since then, the silencing of dissent in civil society transformed Hong Kong’s reputation from a democratic, rules-based, international city into an outpost of Beijing’s ever-expanding security state, under a regime intolerant of dissent.

Since the launch of the International Organization for Mediation (IOMed) in Hong Kong this May, many scholars and analysts have rightfully argued that it is China’s attempt to create an alternative legal order. However, beyond its purpose to challenge the existing Western-led institutions, the launch of IOMed also serves a broader purpose: rebranding Hong Kong as a neutral, international legal hub, even as the political crackdown that damaged its reputation remains firmly in place.

IOMed: Mediation, with Chinese Characteristics

Hong Kong’s new “global mediation centre,” IOMed, is the “first-ever treaty-based and China-led international body that exclusively deals with settling disputes through mediation”, with the intent of “paralleling The Hague.” 

As it stands, the IOMed will focus on the settlement of three types of disputes: 1) interstate disputes; 2) international investment disputes; and 3) international commercial disputes. Furthermore, IOMed is designed to operate under the principles of “respect for state sovereignty, equality, impartiality, non-interference in internal affairs, the rule of law, and efficacy.” The rationale was that it would borrow procedural structures from the current international arbitration models, but with a distinct difference: arbitration awards can be binding and imposed upon the participants, whereas the IOMed’s awards will be on a volunteer basis, therefore non-binding. This reflects China’s official stance “against the zero-sum mentality of ‘you lose, I win’.” Instead, IOMed was established with the goal of finding a solution acceptable to both parties.

Although arbitration remains the primary method for resolving interstate disputes, particularly those involving investments, many Global South states have grown frustrated with existing platforms like the International Centre for Settlement of Investment Disputes (ICSID). These institutions are often criticized for their high legal costs, perceived pro-investor bias, and historical domination by Global North interests. For example, the legal defence costs for developing countries involved in arbitration can run into tens of millions of dollars, even in successful cases. Moreover, these states often have little influence over procedural rules or the appointment of arbitrators, many of whom hail from elite law firms in the U.S. or Europe.

Therefore, on paper, IOMed is a compelling alternative to existing institutions. Its emphasis on consensual resolution and affordability makes it especially appealing to states seeking dispute resolution mechanisms outside of Western-led legal regimes. By presenting itself as a platform that emphasizes “sovereignty,” “mutual respect,” and non-binding dialogue, IOMed taps directly into the legal and political frustrations of many countries in the Global South.

Neutrality or Narrative?

However, the same design that makes IOMed appealing to the Global South also makes it state-controlled, opaque, and ideologically aligned with Beijing’s governance model, which raises questions about its impartiality, credibility, and broader legal legitimacy. 

While IOMed is framed as a neutral platform for peaceful mediation, the West’s exclusion is clear: The known founding members of IOMed are from China-friendly nations across Asia, Africa, and Eastern Europe. Meanwhile, the signatories to the “Joint Statement on the Establishment of International Organization for Mediation” in 2022 include China, Indonesia, Pakistan, Laos, Cambodia, Serbia, Belarus, Sudan, Algeria, and Djibouti — many of whom are partners in the Belt and Road Initiative (BRI) and close to the Chinese regime. Notably absent are any Western democracies. China’s impartiality also comes into question, as Beijing has a precedent in rejecting unfavorable rulings, such as the outright rejection of the 2016 Permanent Court of Arbitration ruling that invalidated its “nine-dash line” claims in the South China Sea — a decision it dismissed as “null and void.”

Furthermore, as other scholars and analysts have pointed out, the organization’s lack of procedural transparency and the absence of an independent oversight mechanism raise concerns. These institutional design choices suggest that IOMed may function less as a genuine dispute resolution forum, rather more as a diplomatic vehicle for China to expand its normative influence under the guise of peaceful multilateralism.

Why Hong Kong?

These concerns regarding IOMed’s credibility are only heightened by the organization’s choice of headquarters: Hong Kong. Since the passage and implementation of the NSL in 2020 by Beijing, Hong Kong’s legal system has been systematically transformed, eroding the separation of powers and the impartiality of the judicial system. The NSL criminalizes vaguely defined offences like “secession,” “subversion,” and “collusion with foreign forces,” grants sweeping powers to the executive and security forces. As Amnesty International reported, “More than 80% of people convicted under Hong Kong’s NSL have been wrongly criminalized and should never have been charged in the first place.” 

In May 2024, a Hong Kong court convicted 14 pro-democracy figures in the landmark “Hong Kong 47” case, one of the largest NSL trials to date, after a closed-door trial without a jury. The trial was presided over by judges handpicked by the Chief Executive, demonstrating the direct executive interference in a judicial case. Similarly, since 2020, multiple elected lawmakers have been disqualified from office for failing to pledge “allegiance,” further narrowing the scope for political pluralism.

These developments fundamentally call into question the integrity and true independence of Hong Kong’s legal system. Hosting IOMed in a city that now operates under a national security regime, where the separation of powers is eroded and judicial outcomes in politically-sensitive cases are often perceived to be pre-determined, undermines the organization’s claim to neutrality. How can a city that no longer upholds impartial adjudication at home credibly facilitate international dispute resolution abroad?

Of course, existing international legal institutions such as the International Court of Justice (ICJ), the Permanent Court of Arbitration (PCA), and the International Centre for Settlement of Investment Disputes (ICSID) are far from perfect. They face criticisms of being dominated by the West, having uneven access. However, they operate under procedural norms designed to guarantee transparency, independence from state pressure, and enforceable outcomes. IOMed, in contrast, offers none of these guardrails, and placing it in a city with diminishing legal autonomy only heightens skepticism about its legitimacy.

The Jury’s Still Out

Although IOMed is framed as a new step towards global mediation, beyond establishing a Chinese-led legal order, it is ultimately part of a broader campaign to recast Hong Kong as an international, rules-based, neutral ground — without having to undo any of the draconian and repressive measures that led to its reputational collapse in the first place.

As a mediation body that supposedly champions neutrality, IOMed cannot function credibly from a city where dissent is suppressed or even criminalized, where the rule of law is selectively applied, and judicial independence is becoming more and more in question. If this is China’s attempt to rebrand Hong Kong as globally trustworthy, it’s asking the world to forget too much, too quickly. For now, although the optics may play well in Beijing and perhaps in some Global South capitals, whether states will genuinely trust Hong Kong again remains to be seen. 

Image credits: Wikimedia Commons / Studio Incendo via Flickr

Calleigh Pan
Calleigh is an undergraduate student at the University of Toronto and the Munk School of Global Affairs & Public Policy. Her research interests include global governance, authoritarianism, diaspora politics, and international security. She has contributed to global policy research as a Compliance Analyst with the G7 and G20 Research Groups and has editorial experience with Vox Civitas Public Policy Research Journal and the Attaché Journal of International Affairs.