Three Documents and an Oral Agreement: Singapore Court of Appeal Determines if a Specific Term is Part of an Agreement
Disagreements as to the existence of contractual terms frequently occur between contracting parties. In Lim Siau Hing @ Lim Kim Hoe and another v Compass Consulting Pte Ltd and another appeal [2023] SGCA 39, the Court of Appeal was required to determine two related appeals concerning whether a specific term formed part of the agreement between the parties. Unfortunately, the agreement was primarily contained in three different documents, which – on their face – did not appear to bear an obvious nexus with each other and were not drafted by lawyers.

Mr Lim Siau Hing @ Lim Kim Hoe and Mr Lim Vhe Kai (collectively, "Lims") had appointed Compass Consulting Pte Ltd ("Compass") to structure a reverse takeover of a company ("RTO"). The Lims agreed to pay a success fee of S$1.1 million to Compass upon completion of the RTO. In addition, at a subsequent meeting, the parties agreed that Compass would be paid incentives in the form of bonus shares ("Bonus Shares") and a cash fee ("Cash Fee") for its services in respect of the RTO ("Agreement") provided certain conditions were satisfied, namely that the Lims' shares would be worth at least S$30 million and constitute at least 65% of the shares in the listed entity. The three material documents ("17 July Documents"), which contained the Agreement, were drafted by a representative of Compass and without any advice from lawyers. The parties agreed that the Agreement was partly written and partly oral. Following the completion of the RTO, the Lims duly paid the success fees of S$1.1 million. However, the Lims did not pay Compass the Bonus Shares and the Cash Fee, as the conditions had not been fulfilled.

When deciding the appeals, the Court of Appeal considered it imperative to consider the totality of the evidence surrounding the signing and preparation of the 17 July Documents and found that the 17 July Documents were meant to collectively evidence an oral agreement that was reached between the parties. The Court of Appeal agreed with the Lims and found that the Bonus Shares and the Cash Fee were not due to Compass as the agreed conditions relating to the RTO had not been fulfilled.

Kelvin Poon SC, Mark Cheng and Tan Tian Hui of Rajah & Tann Singapore LLP successfully represented the Lims, the Appellants in the appeal and Respondents in the cross-appeal.  

When does a Wine Become a "Prosecco"? Singapore Court of Appeal Sets out Approach to Geographical Indications Applications
Most of us are familiar with "Champagne" or "Bordeaux" wines. These are known as Geographical Indications ("GI"), which are signs or marks used to identify that certain goods originate from a particular region or territory, where a given quality, reputation or other characteristic of the goods is essentially attributable to their geographical origin. In the intellectual property regime, GIs play an important consumer protection role, much like trademarks do, but are far less explored in terms of judicial consideration.

In Consorzio di Tutela della Denominazione di Origine Controllata Prosecco v Australian Grape and Wine Incorporated [2023] SGCA 37, the Singapore Court of Appeal ("Court") considered an application for the registration of "Prosecco" as a GI in respect of wines in Singapore. This was the first time the Court of Appeal had to consider the operation and interpretation of various provisions under the Geographical Indications Act 2014 ("GIA"). The appeal concerned section 41(1)(f) of the GIA, which provides that a GI should not be registered if it contains the name of a plant variety or an animal breed and is likely to mislead the consumer as to the true origin of the product.

The Court allowed the application to register "Prosecco" as a GI, finding that the grounds of opposition had not been made out. In reaching its decision, the Court provided insight on how it would consider GI applications, the purpose of GI protection, and the proper approach to section 41(1)(f) of the GIA.

This Update provides a summary of the case and highlights the key elements of the Court's decision.  

CCCS Greenwashing Study and Upcoming Guidelines
Greenwashing has gained considerable prominence in recent times. This naturally followed the growth and importance of environmental sustainability in the global landscape. Greenwashing practices refer to conduct that deceives or misleads consumers on the alleged environmental benefits of products or services. The Competition and Consumer Commission of Singapore ("CCCS") has just issued a report from a commissioned study on greenwashing in online marketing ("Greenwashing Study"), which reviewed environmental claims made on over 1,000 products offered on the 100 most visited e-commerce sites by Singapore residents in October 2022, and seeks to provide guidance on next steps. We set out an overview of the key findings from the Greenwashing Study, the practices that CCCS may potentially cover in its upcoming guidelines, and the potential impact on businesses. 

Significant Investments Review Bill Tabled in Parliament - New Investment Management Regime for Entities Critical to Singapore
On 6 November 2023, the Significant Investments Review Bill ("Bill") was introduced in Parliament. The Bill sets out a new investment management regime which seeks to strengthen the resilience of Singapore's economy and enhance Singapore's national security by ensuring the continuity of critical entities. Moreover, to provide a level playing field for all investors, the new investment regime will apply to both local and foreign investors. The approach of the new law is to address national security threats whilst still preserving Singapore's attractiveness to foreign investors.

To achieve this, only entities that are critical to Singapore’s national security interests will be designated under this new regime ("Designated Entities") and be regulated, rather than adopting an entire sector approach for regulation. Entities that have not been designated but have acted against Singapore's national security interests may also have their transactions reviewed under certain circumstances. This means that the designation is not finite and could potentially be undertaken ad hoc.

The Bill complements existing sectoral legislation, which extends to entities in sectors such as banking, insurance, telecommunications and utilities, where approvals are required for acquisitions that cross certain pre-fixed thresholds. The nature of the approval varies from sector to sector, with some akin to detailed market information being provided and the fact of competition not being affected being established. The approval approach for transactions involving a Designated Entity remains to be seen.

In this Update, we consider the key aspects of the Bill.  

First of its Kind Generative AI Evaluation Sandbox for Trusted AI
Trust is at the core of most, if not all, successful ventures, initiatives and relationships. This human concept extends to the digital realm, and the advancement of artificial intelligence ("AI") solutions into an ever-increasing number of everyday tasks brings the issue of trusted AI models clearly into the limelight.

Seeking to ensure that generative AI is utilised in a safe and responsible manner where trust is sustained, the Infocomm Media Development Authority ("IMDA") and the AI Verify Foundation announced, on 31 October 2023, the first of its kind Generative AI Evaluation Sandbox ("Sandbox"). The Sandbox will bring together key global players to build capabilities in the testing and evaluation of generative AI and is part of efforts to have a common standard approach to assess generative AI. The Sandbox utilises a new draft Evaluation Catalogue that sets out common baseline methods and recommendations for Large Language Models ("LLMs").

In this Update, we briefly explore the risks associated with generative AI models, the key aspects of the Sandbox and how Rajah & Tann can help you successfully navigate the myriad of issues relating to the adoption of AI solutions to meet your business needs.