Deminor’s Edouard Fremault on litigation funding’snext growth phase in Asia

As litigation funding gains momentum across Asia, funders are navigating a patchwork of legal regimes and fast-growing demand for capital in arbitration, insolvency, and enforcement-related matters where capital and risk management are critical.  Leading arbitration hubs in the region have embraced litigation funding and local lawmakers have been agile in establishing, if legally needed, a functional and solid legal framework.

Against that backdrop, we spoke with Edouard Fremault, Chief Strategy Officer and Managing Director APAC at Deminor, about why he relocated to Hong Kong, how the APAC market is developing, and the structural issues shaping litigation funding across the region.

1. You relocated to Hong Kong to lead Deminor’s expanding APAC business. What made this the right moment to deepen your presence in the region, and what has surprised you most about the pace of growth? How does Asia fit into Deminor’s broader global strategy? 

We already had an excellent team on the ground, together with long-standing clients and trusted business partners. Those were the natural starting points for deepening our long-term commitment to the region.

We made our first investment in Asia in 2012, specifically in Japan, and opened our Hong Kong office in 2018 as the market began opening to third-party funding. What initially felt like an experiment to test whether a genuine market existed has since proven successful. The market continues to grow month on month, though, like anywhere else, it comes with its own challenges.

It was also the right moment for our development in Asia to bring additional bench depth, or “grey hair”, onto the ground. I have spent the last 17 years in the funding industry and witnessed its growth in Europe from its infancy, across many nuances of jurisdictions. While obviously different, Asia is just as fragmented as Europe in terms of legal regimes and mindsets. It would make little sense, and would be disrespectful, to replicate in Asia what we have done in Europe and think that it will work here because it worked there. Instead, these years with boots on the ground serve as a humbling learning experience on what to do, and what not to do, when entering a relatively young market in a maturing industry.

2. One of the defining features of APAC is the lack of a consistent regulatory framework for third-party funding. How does this uncertainty affect underwriting and deal structuring across the region? Are there jurisdictions where legal ambiguity is more challenging than others?

In Asia, the recurring question for lawmakers is relatively straightforward: is there a need to regulate third-party funding? In my view, the answer largely depends on legal tradition. Common law, and common law–inspired, jurisdictions have had to regulate due to the doctrines of champerty and maintenance, as illustrated by the approaches taken in Hong Kong and Singapore, which were both lean and effective. By contrast, civil law–inspired jurisdictions such as the PRC, Japan and South Korea do not face the same imperative, as these concepts of champerty and maintenance essentially do not exist in their legal systems.

That said, the absence of a formal regulatory need does not mean there should be no reflection by local authorities on potential regulation. In civil law jurisdictions in Europe for instance, regulatory development over the past 15 years has often begun with statements or recommendations from local bar associations on the use of third-party funding. We consider this approach entirely appropriate and consistently encourage dialogue with local bar associations, whether by sharing our template funding agreements or explaining how funding works in practice to demystify the concept. We are seeing similar openness in Asia, where local bar associations are receptive to these constructive exchanges, and the same should be said about arbitration centres across the region.

3. China is often cited as one of the most complex environments for litigation funding, with inconsistent court decisions on the validity of TPF arrangements. How do funders manage that risk in practice? Do you see signs of greater judicial clarity emerging, or continued fragmentation?

We see two phenomena today that impact our day-to-day activities and demonstrate how funding is being gradually embraced in PRC. First, the concrete achievements made by the legal community in PRC in promoting arbitration as a dispute resolution mechanism, with third-party funding increasingly viewed as a valuable complement to this approach, are often underestimated outside Asia. The revised Arbitration Law, which will come into force on 1 March 2026, is a good illustration of this approach. Second, we are seeing a growing number of local financial institutions seeking to enforce unsatisfied arbitral awards and court judgments outside the PRC, and both they and their lawyers recognise the added value of funding in cross-border disputes.

4. Maintenance and champerty remain live issues in parts of Asia, even as they are abolished or narrowed elsewhere. How real are these risks today for funders operating in common law and mixed legal systems? Does the relative acceptance of funding in arbitration materially reduce those concerns?

Rules are crystal clear in Hong Kong and Singapore as to what funders can and cannot do. We also see Malaysia recently regulating third-party funding in a similar vein.

5. Conflicts of interest are a recurring criticism of litigation funding, particularly the concern that funders may favour early settlements over long-term value. How does Deminor approach incentive alignment in APAC matters? Are these concerns more pronounced in certain types of cases or jurisdictions?

Like elsewhere, by discussing expectations with the client and their lawyers before signing a litigation funding agreement and ensuring both parties have a clear and shared understanding from the outset. If expectations are not aligned at the beginning, it is unlikely that interests will remain aligned over the long term. This is a fairly universal rule.

6. Enforcement is often described as the real battleground in Asian disputes. How central are enforcement, insolvency, and asset recovery considerations when Deminor evaluates funding opportunities? In markets where payment risk is high, does enforcement funding become as important as the merits of the claim itself?

“Battleground” is indeed the name of the game when it comes to enforcement in Asia-related disputes. That is the reality of the market. Effective enforcement requires robust asset tracing and the ability to move very quickly, not only within Asia, for example to secure interim injunctions in cases of asset dissipation, but also through long-term strategies that often extend to offshore jurisdictions or the United States. The good news is that both Hong Kong and Singapore possess world-class arbitration centres, each equipped with an arsenal of interim measures, including ex parte relief. Take HKIAC as an example, where it is possible to obtain a freezing order enforceable in the PRC. We are often asked whether this works in practice. The answer is yes, to a large extent, provided it is done properly.

7. Confidentiality is a cornerstone of arbitration in hubs like Hong Kong and Singapore, yet funding often triggers disclosure questions. How are tribunals and institutions balancing transparency with confidentiality obligations? Do you expect clearer rules on disclosure of funding arrangements to emerge?

As far as HKIAC and SIAC are concerned, the rules on disclosure are set in stone. Disclosure of funding arrangements and the funders’ names is the norm, and we welcome that.

8. Singapore and Hong Kong are frequently held up as best-in-class jurisdictions for litigation funding in arbitration and insolvency. What distinguishes their frameworks from the rest of the region? Are other Southeast Asian jurisdictions moving in a similar direction? 

HKIAC and SIAC are world-class, user-friendly institutions, as consistently confirmed by international surveys of arbitration practitioners. Part of their success lies in their respective nimbleness and, to some extent, in the positive and constructive competition between the two centres. Similar in ambition, yet different in approach. That said, it would be a mistake to overlook recent developments elsewhere in the region, notably in Japan and South Korea, where vibrant arbitration communities are actively working to attract cases locally, as well as the ongoing reforms in the PRC mentioned earlier.

9. Finally, which sectors are driving the next wave of funded disputes in Southeast Asia? Are you seeing sustained growth in areas like complex commercial disputes, intellectual property, cybersecurity, data breaches, and pandemic-related insolvency or contract claims?

A wide variety of crypto-related disputes are particularly prominent at the moment.

10. Anything else we’ve missed?

For a number of reasons, including cultural attitudes towards litigation and the fee structures of law firms in the region, the litigation funding market in Asia is unlikely to match the size of those in the US or the UK and will more likely be comparable to Europe.

Asia is also a market that demands agility and, above all, acceptance that a one-size-fits-all approach is not optimal.

Last but not least: Kung Hei Fat Choi! (wishing you prosperity and wealth for the new lunar year!)