eOASIS is Rajah & Tann Singapore LLP's legal information website for clients, containing business and legal information prepared from a practitioner's viewpoint. It has four different modules, updated regularly, and materials range from commentaries on the latest legal developments to key legal and business information.

What's new on eOASIS

In this second issue of 2019, we discuss various developments, including the new laws relating to taxation on transfer pricing and e-commerce businesses, as well as energy labeling requirements on motorbikes in Vietnam, signing of double-taxation agreements involving Cambodia, and new laws involving weapons of mass destruction and dual-use items in Thailand. With the trade tensions in the world today and the increased need for businesses to be cost-efficient, we also set out a note as to how businesses can benefit from free trade agreements in the context of Malaysia. We also set out a reminder in relation to export of strategic goods from Singapore, in particular to the scope and implication of the ‘catch-all’ provision of such export. 

The Rajah & Tann team comprising Patrick Ang, Jared Kok, Derek On and Torsten Cheong has secured a significant victory before the Court of Appeal in the long-running dispute between the shareholders of the Samwoh Group. In Liew Kit Fah and others v Koh Keng Chew and others [2019] SGCA 78, the Court of Appeal, reversing the High Court’s decision, held that shares which are ordered to be purchased following a compromised oppression suit where liability was not admitted are liable to be discounted to reflect their fair market value. The Court of Appeal’s judgment contains important and authoritative guidance on the proper approach to valuing shares ordered to be sold in this context, when the sale would be treated as one between a willing buyer and a willing seller, and consequently the kind of discounts which would be applicable for the purposes of determining the fair market value of the shares. 

The Payment Services Act 2019 ("PS Act") will come into force on 28 January 2020 (except three provisions setting out related amendments to other Acts), and will repeal the Payment Systems (Oversight) Act and the Money changing and Remittance Businesses Act to consolidate the regulation of payment services under a single legislation. In addition, the PS Act will expand the scope of regulated payment services to keep up with new technological developments in payment services and the various risks they pose. It adopts a licence-based framework for payment service providers and a designation regime for payment systems. 

The Rajah & Tann team led by Danny Ong and Yam Wern-Jhien, specialists in international litigation, has clinched another significant victory on behalf of the MAN group in the Singapore chapter of the long-running litigation against the Skaugen group arising from the supply of marine diesel engines manufactured by MAN.

In MAN Diesel & Turbo SE and anor v IM Skaugen SE and anor [2019] SGCA 80, the Singapore Court of Appeal reversed the decision of the High Court and ordered the service of writ on the MAN entities outside jurisdiction to be set aside, effectively spelling the end of the Singapore chapter of this long-running litigation.

The case is of both practical and academic importance, as it contains authoritative guidance on the role of an appellate court in the review of decisions on jurisdictional issues, the relevance of subsequent events in an application to set aside service out of jurisdiction, how multiple inter-related claims are to be treated in the jurisdiction inquiry, how the availability of the Singapore International Commercial Court (SICC) features in the forum non conveniens analysis, and the test to be applied when assessing where a tortious cause of action arises for purposes of the jurisdiction gateway analysis. 

On 25 November 2019, the Singapore National Environment Agency ("NEA") launched a public consultation on the new domestic controls pertaining to the new requirements regarding the transboundary movement of plastics waste under the Basel Convention on the Control of Transboundary Movement of Hazardous Wastes and Their Disposal ("Basel Convention"). The public consultation ends on 15 December 2019.

The Basel Convention sets out Prior Informed Consent ("PIC") procedure for the transboundary movement of hazardous waste and other controlled wastes. Presently, solid plastic wastes are not considered as hazardous waste unless they contain hazardous substances. Certain plastic waste will eventually be subjected to the PIC procedure.

This will mean that domestically, companies involved in the transboundary movement of such plastic waste will be required to adhere to the PIC procedure, obtain a Basel Permit from NEA, as well as obtain a Bank Guarantee. These new control measures will tentatively come into effect on 1 October 2020.  

On 29 November 2019, the Competition and Consumer Commission of Singapore ("CCCS") announced that it has applied to the State Courts for an injunction under the Consumer Protection (Fair Trading) Act ("CPFTA") against Fashion Interactive Pte. Ltd. and its owner for engaging in an unfair practice (a "subscription trap") on its e-commerce website, myglamorous.sg. This is the first time that the CCCS formally sought a court order against an errant retailer for engaging in an unfair practice under the CPFTA since it took over the enforcement of the CPFTA in April 2018. 

On 28 November 2019, the Singapore Exchange Regulation issued a consultation paper titled "Review of the Tools Used to Deal with Market Manipulation Risk" seeking feedback on its proposal to remove the minimum trading price framework and the expectations of the Singapore Exchange Limited in relation to companies applying to exit from the financial watch-list. The consultation closes on 27 December 2019. 

In Lim Chit Foo v Public Prosecutor [2019] SGCA 70, the Singapore Court of Appeal had to determine an important question relating to the conduct of criminal proceedings: whether the decision to stand down charges is purely within the Prosecution's discretion, or whether it is subject to the supervisory jurisdiction of the court. This decision clarifies the court’s scope of authority with regard to the management of charges which have been stood down. 

Resisting the recognition and enforcement of an arbitral award can be a challenging endeavour. There are limited grounds on which enforcement can be opposed, and the courts have thus far taken a pro-arbitration position of non-interference. However, in ST Group Co., Ltd. & 2 Ors v Sanum Investments Limited [2019] SGCA 65, the Singapore Court of Appeal demonstrated when it would refuse enforcement of an award in the context of a wrongly-seated arbitration. Francis Xavier S.C., Tee Su Mien and Edwin Tan of Rajah & Tann Singapore LLP were instructed counsel before the Court of Appeal, successfully resisting the enforcement of the arbitration award.  

In Lau Jian Bang v Public Prosecutor [2019] SGHC 254, the High Court substituted the two-week imprisonment sentence handed to the Appellant with the maximum fine of S$5,000 on each of his two charges under section 8 of the Remote Gambling Act ("RGA"). Crucially, the High Court found that imprisonment was an inappropriate punishment for first time remote-gambling offenders who are punters. This decision is significant as it sets out a clear sentencing framework for offenders under section 8 of the RGA, superseding all previous sentencing precedents (which the High Court felt were inconsistent). The High Court's decision also explored the legislative intent behind criminalising remote gambling activities, and whether such intent could only be fulfilled by imposing custodial sentences on offenders. 

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