China: Singapore slings: The new cocktail of dispute resolution procedures in Singapore

Last Updated: 9 July 2015
Article by Justin McDonnell and Natalie Caton

Already a hub for international arbitration and mediation, the launch of the Singapore International Commercial Court ("SICC") on 5 January 2015 cemented Singapore as a prime destination for resolving international commercial disputes. Singapore is an ideal location particularly for those doing business in the Asia-Pacific region. Singapore's Chief Justice Sundaresh Menon stated that the Court aimed to 'build upon and complement the success of [Singapore's] vibrant arbitration sector and make [Singapore's] judicial institutions and legal profession available to serve the regional and the global community.'

The opening of the SICC means there are now three institutions in Singapore capable of resolving international commercial disputes: the SICC, the Singapore International Mediation Centre ("SIMC") and the popular Singapore International Arbitration Centre ("SIAC"). SIMC and SIAC administer complementary resolution procedures with the new arbitration-mediationarbitration protocol allowing for mediation within the framework of arbitration. Distinct from these procedures, the SICC is litigious in nature but draws from the best international arbitration practices.

Overview of the SICC

The SICC is a division of the Singapore High Court and must operate in accordance with the Court's rules. Its purpose is to hear claims of an international and commercial nature.

As with arbitration, the SICC derives its jurisdiction from a written agreement between the parties. Ideally, an agreement to submit to the SICC will be made predispute, when contracts are negotiated and entered into. While parties may also agree to submit a dispute to the SICC after it arises, the difficulty with this approach is reaching agreement in such.

A significant difference to the arbitration process is that, in certain circumstances, a claim can be transferred from the Singapore High Court to the SICC. So, by submitting to the jurisdiction of the Singapore courts your dispute may ultimately be referred to the SICC.

The SICC judiciary includes judges of the Singapore High Court as well as international jurists including Mr Dyson Heydon AO QC, former judge of the High Court of Australia. Claims before the SICC will be heard by either a single judge or a panel of three judges. The number of judges on the bench is determined by the Court and particular cases may be heard by specific judges if they have expertise in that area. This is similar to the arbitral practice of parties nominating arbitrators based on their specific legal qualifications or knowledge, however, parties before the SICC do not have the ability to nominate the judiciary representatives who will determine their case.

Foreign Representation

One clear benefit of the SICC is that foreign lawyers may appear as counsel in proceedings commenced in the SICC, and in subsequent appeals. This is a unique feature of the SICC as foreign advocates and solicitors are generally not allowed to appear in courts of a country they are not qualified in. For a foreign lawyer to appear in the SICC he or she must register with the SICC Register of Foreign Lawyers.

Comparison between the SICC and SIAC

The SICC is an appealing option amongst a suite of viable dispute resolution processes. Indeed, it takes several cues from arbitration and seeks to marry these with the best of Singaporean Court practices. For example, proceedings before the SICC may remain confidential on application of a party. There are also differences between the SICC and SIAC. As a court based dispute resolution process, the SICC allows wider rights of appeal than arbitration and the publication of the SICC decisions enables the development of legal precedent.

Enforcement

Still in its infancy, the SICC isn't perfect.There are questions related to the enforceability of a SICC judgment outside Singapore. In this regard, arbitration surpasses the SICC because most countries are signatories of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

The ability to enforce the SICC judgments outside Singapore is complicated because it depends on the legislation of the place where enforcement is sought. By way of example, in Australia, the enforcement of foreign judgments is governed by the Foreign Judgments Act 1991. This Act lists Singapore as one of the countries with whom Australia has reciprocal enforcement arrangements. The effect of this is that the SICC judgments are enforceable in Australia in accordance with the provisions of the Act. While there are also conventions which provide for the recognition of foreign court judgments, they have not been widely adopted.

The view of the SICC is that as the court's jurisdiction is based primarily on consent, there should, in theory, be no need to resort to enforcement measures. However, for commercial parties, doubts as to the enforceability of a SICC judgment may be a major disincentive to utilize the services of the SICC.

The SICC is still a young institution and its effectiveness and popularity are yet to be determined. Its launch means there are now three forums available in Singapore for international dispute resolution. This diversity in dispute resolution forums is being reflected in the Asia-Pacific region more generally, and dispute resolution is becoming a matter of taste.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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