Legal Updates for June 2020
COVID-19 (Temporary Measures) Act 2020 Extended to Leases/Rental Agreements for Commercial Equipment and Commercial Vehicles
The COVID-19 (Temporary Measures) Act 2020 ("Act") provides for, among other things, targeted and temporary reliefs for individuals and businesses that are unable to perform certain contracts due to the uncertainties brought about by COVID-19. These temporary relief measures apply for six months from 20 April 2020 to 19 October 2020.
On 20 June 2020, the Act was amended to (1) extend the temporary relief measures under the Act to leases or rental agreements for commercial equipment and commercial vehicles; and (2) give effect to part of the changes set out in the COVID-19 (Temporary Measures) (Amendment) Act 2020. These changes aim to enhance the temporary relief measures for an inability to perform a scheduled contract specified in the Act.
This Update provides a summary of the changes to the Act that took effect on 20 June 2020.
Employment Agencies to Comply with New Licence Conditions for Fair Hiring
With effect from 1 October 2020, the Ministry of Manpower will require all employment agencies in Singapore ("EAs") to comply with the fair recruitment requirements set out in the Tripartite Guidelines on Fair Employment Practices ("TGFEP") when recruiting on behalf of their clients. The TGFEP contains fair and merit-based employment guidelines that all Singapore-based organisations are expected to abide by.
These new guidelines will be imposed as new licensing conditions on the EAs, and non-compliance may result in demerit points, suspension or revocation of an EA licence or prosecution.
This Update highlights the new licence conditions that EAs must comply with to ensure fair hiring.
Modalities for Court-to-Court Communication in Cross-Border Insolvency Proceedings
On 19 June 2020, the Singapore Supreme Court issued Registrar's Circular No. 7 of 2020, which implements the Modalities of Court-to-Court Communication ("Modalities") published by the Judicial Insolvency Network. The Modalities serve to supplement the Guidelines for Communication and Cooperation between Courts in Cross-Border Insolvency Matters ("Guidelines"). While the Guidelines deal with court-to-court communication in parallel proceedings, the Modalities prescribe the mechanics for initiating, receiving and engaging in such communication.
This development further enhances the Singapore courts' ability to effectively manage cross-border insolvency proceedings. This Update provides a summary of the key features of the Modalities and the Guidelines.
MAS to Revise Exemption Framework for Cross-Border Business Arrangements of Capital Markets Intermediaries
To facilitate business arrangements between financial institutions in Singapore ("Singapore FIs") and their foreign related corporations ("FRCs"), the Monetary Authority of Singapore ("MAS") has put in place a framework since 2002 that permits these FRCs to provide cross-border financial services to customers in Singapore without being subject to the licensing requirements in Singapore ("FRC Framework"). Under the current FRC Framework, an arrangement between a Singapore FI and its FRCs for the FRCs to provide cross-border financial services in Singapore ("FRC Arrangement") must be approved by MAS on a case-by-case basis.
On 5 June 2020, MAS announced that it will proceed with its proposal to move the approval approach under the FRC Framework to an ex-post notification approach ("New FRC Framework").
This Update provides an overview of the new FRC Framework and the revised conditions thereunder. The conditions under the New FRC Framework will be set out in legislation and Singapore FIs with existing FRC Arrangements will be given an appropriate transition time to submit the notification required under the New FRC Framework. MAS is expected to seek further feedback on details of the New FRC Framework.
Singapore Issues First National Standard on Guidelines for E-Commerce Transactions
E-commerce is a vital and growing section of the retail industry, with online retail making up a fast-increasing proportion of the total retail sales in Singapore. Enterprise Singapore and the Singapore Standards Council have thus launched the first national standard, Technical Reference 76 ("TR 76"), on guidelines for e-commerce transactions. TR 76 serves as a practical guide for e-retailers who sell directly to customers online, as well as online intermediaries such as e-marketplaces. It may also be relevant for third-party service providers, retailers providing online catalogues and parties looking to start their own online businesses. The guidelines provide comprehensive end-to-end coverage of the e-commerce transaction process. This Update highlights the key aspects of TR 76 and discusses how it may impact or benefit online businesses and e-retailers.
A QUICK ANTI-CORRUPTION GUIDE FOR BUSINESSES IN ASEAN, CHINA & JAPAN
International corruption has been estimated to cost a massive $3.6 trillion annually in the form of bribes and stolen money, amounting to over 5% of global GDP. It has been listed by the United Nations as one of the biggest impediments to achieving its 2030 Sustainable Development Goals, and governments worldwide have criminalised corruption in an effort to stem the losses.
Rajah & Tann Asia's member firms and regional desks hail from the jurisdictions of Cambodia, China, Indonesia, Japan, Lao PDR, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam. This Publication brings together our lawyers from the above jurisdictions to answer the following questions on anti-corruption efforts:
- What is the principal anti-corruption legislation in your country?
- Who is the authority in charge?
- Does the principal legislation have extra-territorial effect?
- Is there a different threshold in bribery offences in the public and private sector?
- Is there a duty to report bribery offences?
- What are the key offences under the principal legislation?
- What are the penalties for the key offences?
- Are there defences to the key offences?
- If a body corporate commits an offence under the principal anti-corruption legislation, would the officers of the body corporate be liable?
- Are Deferred Prosecution Agreements an option in your country?
- Are there any other key anti-corruption initiatives in your country?
- What is the enforcement trend of anti-corruption laws in your country?
Sustaining the Financial Sector Through Sustainable Finance
Sustainable finance is the practice of integrating environmental, social and governance ("ESG") criteria into financial services to bring about sustainable development outcomes. The Monetary Authority of Singapore ("MAS") has in recent years been incorporating sustainable finance into its policies and schemes, and encouraging financial institutions to adopt it as a pillar in their business. This Update looks at the existing ESG regulatory framework and the initiatives that local and international Financial Institutions should take note of, as well as the upcoming MAS Environmental Risk Management Guidelines and the green and sustainability loan grant scheme.
Public Consultation on Proposed Licence Conditions and Code of Conduct for Collective Management Organisations
The Ministry of Law and the Intellectual Property Office of Singapore are conducting a public consultation ("Consultation") on the proposed licence conditions and Code of Conduct for collective management organisations ("CMOs"). The public consultation period is from 3 June 2020 to 30 June 2020. Currently, there is no regulation or independent oversight over the governance and management of CMOs, and as such no minimum standard which CMOs have to adhere to in their dealings with members and users. The objective of the Consultation is to ensure that the Proposed Licensing Scheme fosters a well-functioning collective management ecosystem. This Update highlights the key features of the Proposed Licensing Scheme.
The Acquisition of Minority Shareholding Without Control Can Trigger Notification Requirements
Can a simple investment trigger a merger investigation? Looking at two recent cases from the UK and Australia, this update discusses the onus put on businesses to assess holistically whether an investment which does not confer de jure nor de facto control should nevertheless be notified to the competition regulator for authorisation. The approach here is applicable across multiple countries, including Singapore.
Telemedicine before, during and after COVID-19: Key Considerations and Issues
The acceleration in the use of telemedicine is expected to be one of the lasting changes to lifestyles as a result of the COVID-19 pandemic. As defined by the Ministry of Health (Singapore), telemedicine refers to the provision of healthcare services over physically separate environments via information technology, and it includes the exchange of information for clinical purposes between healthcare providers and patients through text messaging, web or mobile applications. In this Update, we discuss the regulatory framework in respect of telemedicine in Singapore and highlight some issues that healthcare providers, employers and patients should note in the implementation of telemedicine.
Going Forth: Singapore's Fortitude Budget for Employers, Tenants, and Businesses
With the end of the circuit breaker period on 1 June 2020, the Singapore government has laid out a three-phase approach towards the resumption of normality. Phase One commenced on 2 June 2020 and is expected to last for at least four weeks, although this will be reassessed in mid-June 2020 with a view to shortening it. It is marked by a restart of some economic activities that do not pose a high risk of transmission, such as manufacturing and office work. Telecommuting must still be adopted to the maximum extent. Some major sectors, such as retail and dining-in, will not be permitted to reopen until Phase Two.
As progression to the next phase depends on the COVID-19 situation rather than a fixed timeframe, many businesses remain uncertain as to when they can reopen. On 26 May 2020, the Minister of Finance Mr Heng Swee Keat ("DPM Heng") announced the fourth Budget, christened the Fortitude Budget, to provide further relief in these times of economic uncertainty.
In this Update, we cover key aspects of the Fortitude Budget that relate to employers, tenants, and businesses.
Fast Lane for Essential Business and Official Travel Between China and Singapore
On 3 June 2020, the Ministry of Trade and Industry (MTI) and Ministry of Foreign Affairs (MFA) jointly announced that fast lane arrangements will be in place to facilitate essential business and official travel between Singapore and China. The fast lane arrangements will be established between Singapore and six Chinese provinces and municipalities (Chongqing, Guangdong, Jiangsu, Shanghai, Tianjin and Zhejiang).
Under the fast lane arrangements, residents in Singapore who are seeking to make essential travel to China must be sponsored by either a company or a government agency in China, while residents in China who are seeking to make essential travel to Singapore must be sponsored by either a company or a Singapore Government agency.
From 8 June 2020, a traveller sponsored by a government agency for essential business or official travel to Singapore may submit an application under the fast lane arrangements. Applications for company-sponsored travellers may be submitted in a later phase.
This Update highlights the key requirements of the fast lane arrangements which relate to: (1) applications for approvals by the relevant authorities and visas; (2) pre-departure health measures; (3) post-arrival health measures; and (4) controlled itinerary.
Responsible AI Adoption for FIs – "Fairness Metrics" and Other Legal and Compliance Issues
Artificial Intelligence ("AI") and Data Analytics solutions are increasingly used in the financial sector to improve business processes, mitigate risks and facilitate stronger decision-making. It is critical that AI and Data Analytics solutions are employed responsibly and effectively.
The Monetary Authority of Singapore announced on 28 May 2020 that the first phase of the Veritas initiative will commence with the development of fairness metrics in two use cases of credit risk scoring and customer marketing.
This development highlights the criticality of having an AI and Data Analytics policy for financial institutions ("FIs") and the key legal, commercial and compliance issues and action items FIs should take note of when employing AI and Data Analytics solutions in their operations.
What Constitutes Fraud and Unconscionability in a Construction Dispute?
The Singapore courts have recently issued decisions dealing with fraud and unconscionability in the context of construction disputes, providing further guidance on the applicable principles.
In this Update, we take a look at the key aspects of these judgments and their implications.
- In CFA v CFB  SGHC 101, the Singapore High Court examined what constitutes fraud in the context of an application to set aside a SOPA adjudication determination.
- In CEX v CEY  SGHC 100, the Singapore High Court sets out a framework for evaluating whether an injunction restraining a call on the performance bond should be granted on the ground of unconscionability.