24 January, 2018
On 9 January 2018, the Singapore Parliament passed amendments relating to the Singapore International Commercial Court (SICC).
The Supreme Court of Judicature (Amendment) Bill (No. 47/2017) (Bill) principally aims to: (1) clarify the extent of the SICC's jurisdiction; and (2) streamline the SICC's procedure.
The SICC was established in 2015 as a division of the High Court to decide international commercial disputes (including those governed by foreign law with only tenuous connections to Singapore). Our earlier article, which summarizes the key features of the SICC, may be found here. In its first three years, the SICC has heard 17 cases, which raise diverse issues and involve parties from various jurisdictions.
The latest amendments, together with the strategic expansion of the SICC bench (to include four new eminent international jurists from Australia, Canada and England), anchor the SICC's reputation as a neutral venue for international and commercial litigants and underpin Singapore's ongoing endeavor to become a leading centre for the resolution of international commercial disputes.
The 2 main amendments of the Bill are summarized below.
First, the new section 18D(1) of the amended Act, provides that:
"…the Singapore International Commercial Court (being a division of the High Court) has jurisdiction to hear any proceedings relating to international commercial arbitration that the High Court may hear and that satisfy such conditions as the Rules of Court may prescribe."
This clarifies that the SICC is empowered to hear any case relating to international commercial arbitration. In this regard, the Bill makes consequential amendments to section 80(2A) of the amended Act to allow the Rules of Court to prescribe: (i) what constitutes an international commercial arbitration; and (ii) the conditions that arbitration-related proceedings must satisfy to be heard by the SICC.
Currently, the High Court has jurisdiction to hear certain matters regarding international commercial arbitration and domestic arbitration. For example, parties can apply to the High Court to stay court proceedings, to set aside an arbitral award issued in Singapore, to challenge the jurisdiction of the arbitral tribunal and to enforce an award.
This amendment enables parties to make an application to the SICC for cases arising from international commercial arbitration for consideration by a world class bench of judges. A case may also be transferred to the SICC from the High Court (and vice versa) in accordance with the transfer requirements set out in the Rules of Court.
It is intended, however, like the usual arbitration-related applications before the High Court, that only Singapore qualified lawyers from Singapore law practices will be allowed to argue these cases.
Foreign lawyers, who may be registered to represent parties in an "offshore case" (as defined under the Rules of Court), will not be able to appear before the SICC for international commercial arbitration matters. This is notwithstanding that the original contract, which was the subject matter of the arbitration, may have been governed by a foreign law and that the foreign lawyers had represented the parties in the arbitration.
There is a pragmatic rationale for this approach: In her Second Reading Speech on the Bill, the Senior Minister of State for Law and Finance, Ms. Indranee Rajah, explained that the Singapore International Arbitration Act (IAA), which governs international commercial arbitration, is a Singapore Act, with features that are tailored for the Singapore arbitration landscape. Singapore lawyers are therefore adept at the interpretation and application of the IAA provisions, which is based on a well developed body of local jurisprudence.
Second, clause 3 of the Bill removes the option of applying for a pre-action certificate.
The pre-action certificate is a novel feature of the SICC (and without precedent in the procedures of the courts of Singapore or England). It is designed specifically to give the parties an early, preliminary indication from the SICC on key issues (regarding jurisdiction, legal representation etc.).
At the SICC's inception, it was envisaged that potential parties should have the option of applying for a pre-action certificate to certify that the intended action is international and commercial in nature, and can therefore be heard by the SICC.
However, the Singapore Supreme Court has not received positive feedback on the utility of the pre-action certification procedure. As such, and since users and counsel are now more familiar with the SICC and its procedures, it was removed.
Comments
By allowing the SICC to hear matters relating to international commercial arbitration, these latest amendments provide litigants with the benefit of having an experienced and internationally renowned bench of jurists hear and determine their arbitration-related court applications.
This will naturally go a great way toward enhancing the SICC's reputation and Singapore's popularity as a seat of arbitration more broadly.
It is worth mentioning that, while international commercial arbitration comes under the IAA and domestic arbitration is governed by the Arbitration Act (AA), parties can by agreement opt for one or the other statute to govern their arbitration. Thus, an international commercial arbitration can come under the AA, and a domestic arbitration can come under the IAA, if parties so agree.
The amendments to the Rules of Court should clarify exactly what is meant by international commercial arbitration.
For further information, please contact:
Leng Sun Chan SC, Principal, Baker McKenzie
lengsun.chan@bakermckenzie.com
