Court rules liquidators can pursue PwC globally over Evergrande collapse

Hong Kong’s High Court has blocked PwC International from withdrawing from a lawsuit brought by the liquidators of China Evergrande Group, opening the door for the accounting giant to face global liability over its role in auditing the property developer before its spectacular collapse.

The ruling means liquidators can continue pursuing claims alleging negligence and misrepresentation in PwC’s auditing of Evergrande’s financial statements from 2017 to 2020. The total damages sought come to roughly 57 billion yuan, or approximately $8.4 billion, with PwC International potentially on the hook for up to 38 billion yuan.

What the court actually said

Deputy High Court Judge Patrick Fung was notably unimpressed with PwC’s defense. He characterized the evidence the firm presented as “inadequate and unsatisfactory,” ruling that further discovery and a full trial are needed to resolve the matter.

PwC had argued that its Hong Kong and China affiliates were independent entities with no direct ties to Evergrande. The court wasn’t buying it.

The liquidators, Eddie Middleton and Tiffany Wong of Alvarez & Marsal, were appointed following Evergrande’s liquidation order in early 2024. They have been methodically building cases against former executives and auditors as part of broader recovery efforts for creditors left holding the bag on one of the largest corporate failures in history.

The Evergrande backstory

China Evergrande Group defaulted on its debts in late 2021, revealing estimated liabilities exceeding $300 billion. The default sent shockwaves through China’s property sector and triggered a rolling crisis that dragged down other major developers.

Evergrande’s founder, Hui Ka Yan, was sentenced to life in prison on fraud-related charges on August 20, 2026, just days before this court ruling.

The accounting firm is already dealing with separate regulatory fallout. A contentious HK$1 billion settlement arose from complaints filed with the Hong Kong Securities and Futures Commission, though the liquidators are currently challenging that settlement, suggesting they believe PwC’s financial accountability should extend well beyond that figure.

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