Hong Kong court to hear Evergrande liquidators’ lawsuit against PwC on Monday

The liquidators of China Evergrande Group’s lawsuit against PricewaterhouseCoopers (PwC) International will have their case heard in the Hong Kong High Court on Monday, according to records posted on the judiciary’s website. The one-day hearing was scheduled before Deputy Judge Patrick Fung Pak-tung of the High Court and would be open to the public, the court information showed. It concerns efforts by Evergrande’s liquidators to seek claims from PwC International over the developer’s auditing issues. It marks the latest development in the Evergrande saga. Last month, Hong Kong’s Securities and Futures Commission (SFC) reached an agreement with PwC Hong Kong to pay HK$1 billion (US$128 million) in compensation to minority shareholders of the developer, citing serious breaches of auditors’ professional duties. Separately, the Accounting and Financial Reporting Council (AFRC) fined PwC HK$300 million and imposed a six-month practice restriction, while two former partners were fined HK$10 million in total over the Evergrande audits, the regulator said in April. The AFRC found “numerous serious audit deficiencies” in PwC’s work on Evergrande’s 2019 and 2020 accounts. Alongside the fine, the accounting watchdog barred PwC from accepting new listed-company audit clients for six months. Former partners Cheung Siu-cheong and Chow Sai-keung, who oversaw quality control on the audits, were each fined HK$5 million. The Hong Kong penalties followed action by mainland China regulators in September 2024, when PwC was fined 441 million yuan (US$64.75 million) and banned for six months from auditing Evergrande’s mainland units for failures spanning 2018 to 2020. Evergrande founder Hui Ka-yan, once among China’s richest businessmen, pleaded guilty last month to charges including embezzlement and corporate bribery, according to the Shenzhen Intermediate People’s Court, which said it would deliver judgment later. Once the world’s largest developer by sales, Evergrande collapsed under liabilities exceeding US$300 billion, leaving creditors facing heavy losses and unfinished projects across China. The Hong Kong High Court ordered the wind-up of Evergrande in January 2024 after Madam Justice Linda Chan Ching-fan approved a creditor petition to liquidate the world’s most indebted property developer in the biggest such case seen in the city. Chan appointed Eddie Middleton and Tiffany Wong Wing-sze, managing directors of consulting firm Alvarez & Marsal, as joint liquidators.