Ordinarily, a winding-up petition based on the inability of a company to pay its debts will be stayed or dismissed only if the debt is disputed on bona fide and substantial grounds (“the established approach”).3 Where the disputed debt falls within the scope of an arbitration clause, however, different approaches have been adopted. The dominant approach in Hong Kong has been that advanced in Lasmos Ltd v Southwest Pacific Bauxite 4 (“Lasmos”). According to Harris J in Lasmos,5 a winding-up petition should generally be stayed or dismissed if: (1) the company disputes the debt relied on by the petitioner; (2) the contract under which the debt is alleged to arise contains an arbitration clause that covers any dispute relating to the debt; and (3) the company takes the steps required under the arbitration clause to commence the contractually mandated dispute resolution process. Under this approach, it is not necessary for the alleged debtor to dispute the debt on “bona fide and substantial grounds”. Adopting the Lasmos approach positioned Hong Kong somewhere between the approaches in other common law jurisdictions. Whereas the Singaporean and Malaysian courts will, in the absence of exceptional circumstances, stay or dismiss winding-up petitions if they are based