On 10 January 2017, Singapore's Parliament passed the Civil
Law (Amendment) Bill 2016, allowing third-party litigation
Civil Law (Amendment) Bill 2016
The key features of the Civil Law (Amendment) Bill 2016 are:
Abolishes the common law tort of
champerty and maintenance in Singapore.
Allows third-party funding in certain
categories of dispute resolution proceedings. They will be set out
in the Civil Law (Third Party Funding) Regulations.
Allows conditions to be imposed on
third-party funders. Funders who do not comply with these
conditions will not be able to enforce their rights under their
third-party funding contracts.
Allows lawyers to recommend
third-party funders to their clients, provided the lawyers do not
receive any direct financial benefit from such recommendation.
Lawyers are allowed to advise on, negotiate and draft third-party
funding contracts for their clients, as well as to act for their
clients in any dispute arising out of the third-party funding
Civil Law (Third-Party Funding) Regulations 2016
The Civil Law (Third-Party Funding) Regulations 2016, which will
set out the parameters for the third-party funding allowed in
Singapore, are likely to be similar to those on which the Ministry
of Law invited feedback on 30 June 2016.
The key points of that draft regulation are:
It prescribes that the categories of
dispute resolution in which third-party funding is allowed are
international arbitration proceedings, and court and mediation
proceedings related to an international arbitration.
It sets out the qualifications for
qualifying third-party funders, which are:
The third-party funder's
principal business is third party funding.
The third-party funder must have
access to funds immediately within its control, including within a
parent corporation or a subsidiary to fund dispute resolution
proceedings in Singapore.
The funds referred to in b. must be
invested pursuant to a third-party funding contract to enable the
funded party to meet the costs of the dispute resolution
Singapore as Centre for Dispute Resolution
The passing of the Civil Law (Amendment) Bill 2016 is part of
Singapore's push to become a centre for dispute resolution.
With these changes in the law, Singapore likely becomes a more
attractive forum for parties to have their disputes heard,
especially now that they can have recourse to third-party funding,
which allows them to mitigate the risks of litigation, manage cash
flow and pursue meritorious claims that they might not be able to
pursue without sufficient funding.
If you have any questions about this Alert, please
contact Tham Wei Chern, any of the attorneys in the Duane Morris
& Selvam LLP Singapore office or the attorney in the firm with
whom you are regularly in contact.
Disclaimer:This Alert has been
prepared and published for informational purposes only and is not
offered, nor should be construed, as legal advice. For more
information, please see the firm's
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