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    02:36 PM Denise Wong (Assistant Professor, Singapore Management University)

    The Singapore International Commercial Court: A New Era in Commercial Litigation in Singapore

        

    The Singapore International Commercial Court (“SICC”) was first announced at the Singapore Opening of Legal Year Ceremony 2013 and the Report of the SICC (“the Report”) was released in November 2013. Barely a year later, legislative changes were tabled in Parliament to establish the court. This blog entry highlights key features of the SICC as well as legislative changes that have been passed in order to establish the court. It also flags a number of key issues that may require further consideration even as the foundations of the court are being laid. 

    Key Aspects of the SICC

    The SICC seeks to build on the already thriving litigation and arbitration sectors in Singapore by becoming a centre for dispute resolution with a uniquely Asian flavor (see Report of the Singapore International Commercial Court Committee, available at: http://www.mlaw.gov.sg/content/dam/minlaw/corp/News/Annex A - SICC Committee Report.pdf (“The Report”)). The court is envisaged as the third prong of a three-part strategy for Singapore to become the world’s leading hub for cross border litigation. 

    The SICC will be established as a division of the High Court, with the Chief Justice of Singapore, or a Judge as appointed by the Chief Justice, as its President. The SICC will have jurisdiction to hear cases that can be heard by the High Court in its original civil jurisdiction, and which are international and commercial in nature. It is envisaged that the judges hearing cases in the SICC will be drawn from an international panel of jurists (known as International Judges), as well as current judges of the Singapore Supreme Court (see The Report, p 13). This would mean that cases with, for example, a predominantly Indonesian focus would be heard by a judge who is familiar with Indonesian law. Proceedings in the SICC will be heard by a single judge or by three judges. Foreign counsel can also apply to represent parties before the SICC (see The Report, p 18). 

    Significantly, procedures in the SICC will not be governed by domestic rules of procedure. During the second reading of the Supreme Court of Judicature (Amendment) Bill, the Minister stated that the rules and procedure before the SICC will differ from those before the High Court in three broad areas:

    a.     First, cases before the SICC will not be bound by the rules of evidence that are applicable under Singapore law, in such cases and to the extent as provided for in the Rules of Court. 

    b.     Second, the Rules of Court may provide for different procedures and practices to be followed in the SICC.

    c.      Third, even where Singapore’s laws of evidence are applicable, the SICC may allow any questions of foreign law to be determined on the basis of submissions, without requiring formal proof by experts.

    The intention is clearly for the SICC to have practices and procedures that have a familiar feel to international practitioners. The Report states that the rules and practice directions governing the SICC will follow international best practices, and particular reference will be made to the English Commercial Court Guide (see The Report, p 16).

    Legislative Changes

    In order to establish the SICC in the manner set out above, the Ministry of Law tabled the Constitution of the Republic of Singapore (Amendment) Bill and the Supreme Court of Judicature (Amendment) Bill for First Reading in Parliament on 7 October 2014 (see Press release from Ministry of Law dated 7 October 2014, available at https://www.mlaw.gov.sg/content/minlaw/en/news/press-releases/SICC-and-legal-profession-regulatory-framework-update.html). Miscellaneous consequential amendments were also proposed to other legislation.

    The Constitution of the Republic of Singapore (Amendment) Bill provides for the appointment of the International Judges to adjudicate upon specific cases or for a specified period to hear specific cases or classes of cases as and when assigned by the Chief Justice. This bill also provides for the former judges of the Singapore Supreme Court to be appointed as Senior Judges to hear cases before the High Court (including the SICC) or Court of Appeal.

    The amendments set out in the Supreme Court of Judicature (Amendment) Bill put in place the framework for the establishment and operation of the SICC as set out above, most important of which is the establishment of the court as a division of the High Court of Singapore. This bill also provides for the SICC’s composition and powers, in particular that the court’s docket will comprise international commercial disputes, including those governed by foreign law. 

    Issues to Watch

    International Enforceability

    A key factor that will impact the SICC’s success is its user-friendliness to the disputants. Under the current framework, judgments of the SICC will be considered a judgment of the Singapore High Court. This arrangement is presumably grounded in the need for international enforceability of the SICC judgment. Lower court judgments may face difficulties with enforcement in some jurisdictions. As such, given that the success of the SICC will in part be predicated on the ease of enforceability of the SICC judgment in jurisdictions in which the losing party has assets, such a structural arrangement is essential. 

    Unlike international arbitral awards that are enforceable by way of the New York Convention, judgments of the SICC have the status of national court judgments and their enforceability would be dependent on the principles governing the recognition of foreign judgments in the relevant jurisdiction. This is undoubtedly one of the disadvantages that an SICC judgment will have as compared to an arbitral award. It is perhaps to address this key issue that the Supreme Court of Judicature (Amendment) Bill stipulates that the parties who have agreed to submit to the jurisdiction of the SICC shall, unless expressly stated otherwise, also be considered to have agreed:

      i.      to submit to the exclusive jurisdiction of the SICC,

     ii.      to carry out any SICC judgment without undue delay; and

    iii.     to waive any recourse to any court or tribunal outside Singapore against any SICC judgment and the enforcement of such judgment.

    This presumption is likely to go some way to address concerns that the SICC judgment would not be as easily enforceable as an arbitral award. However, given that parties can choose to opt out of such agreement, it may be necessary for further steps to be taken to increase the likelihood of a judgment being enforced. One option is for memoranda of understanding to be reached between the SICC and courts in other jurisdictions on enforcement issues (see, for example, the Memorandum of Guidance as to Enforcement between the DIFC Courts and the Commercial Court, Queen’s Bench Division, England and Wales, available at http://international.lawsociety.org.uk/files/MoG DIFC-UK 0113.pdf), or for agreements to be reached at regional or even international levels (See the Hague Convention on Choice of Court Agreements as an example, available at http://www.hcch.net/index_en.php?act=conventions.text&cid=98).       

    Role of the SICC in the context of International Arbitration

    The SICC, on one view, may detract from the success of arbitration as it may potentially cannibalise some of the cases that would otherwise have gone through the route of institutionalized arbitration. This issue was specifically addressed in the Second Reading speech on the Constitution of the Republic of Singapore (Amendment) Bill, where the Minister reassured that the SICC will complement existing arbitration services and broaden the suite of dispute resolution options that are available and will attract parties who would not otherwise have come to Singapore to have their disputes resolved here. Indeed, it can be argued that the SICC should instead be viewed as supporting and enhancing arbitration by playing a critical role in encouraging the harmonisation of commercial law, particularly in the Asian region. 

    The organic nature of a transnational mercantile law has meant that it has taken various guises throughout the centuries, but its existence is increasingly acknowledged and has become more of a necessity than ever before. In particular, the need for high speed dispute resolution in the globalized transactional world requires recourse not just to a highly efficient dispute resolution mechanism, but more specifically, a unified and digestible set of substantive legal norms. In this vein, there is a growing trend of thought which posits that the global business world is finally well placed to create and sustain a freestanding body of substantive commercial law. The SICC is uniquely positioned to contribute to the development of this as the judgments of the SICC will, in the usual course, be made public, which would allow a body of jurisprudence to develop in a far more sustained and systematic manner than hitherto permitted by any arbitral regime. In time, if the SICC achieves its ideal of becoming the go-to dispute resolution centre for disputants in Asia, it can concomitantly become the thought leader and champion for a regional lex mercatoria.  

    The Law of the Forum

    It is not immediately apparent what the SICC will adopt as the law of the forum. This is an important consideration, particularly since the court is specifically tasked with presiding over cross-border disputes. A lack of certainty in this area may cause difficulties in relation to challenges to the jurisdiction of the court. Where such a challenge is mounted, the issue is what ought to be the applicable law to govern the dispute. Certainty as to lex fori is also crucial in respect of choice of law, since the forum court will apply its own conflict of law rules to determine the applicable law for resolving the substantive dispute. A simple solution would be for Singapore law to be chosen as the lex fori

    In conclusion, there is still much work to be done to ensure the SICC will be become a successful fixture on the global dispute resolution scene. Nonetheless, it does seem that the right steps have been taken to meet the challenges that lie ahead and Singapore seems well placed to be one of the frontrunners in establishing a dispute resolution hub that offers a full suite of services to international disputants. 

    * This blog entry may be cited as Denise Wong, "The Singapore International Commercial Court: A New Era in Commercial Litigation in Singapore", Singapore Law Blog (7 December 2014) (http://www.singaporelawblog.sg/blog/article/64)

    ** See also D Wong, ‘The rise of the international commercial court: what is it and will it work?’ (2014) Civil Justice Quarterly, 33(2), 205-227

    *** A PDF version of this entry may be downloaded here

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