Legal Updates for March 2022疫情两年后，新加坡高等法庭对视频作证持何态度？ꟷꟷ 从新加坡高等法庭最近驳回外国证人以视频连线方式出庭作证请求一案谈起
在全球从新冠疫情逐渐复苏的环境下，新加坡高等法庭普通审判庭近期在 Wang Xiaopu v Koh Mui Lee and others [2022] SGHC 54 一案(“本案”)中针对海外证人申请通过视频连线的方式出庭作证这一问题作出了指导。需要注意的是，法庭强调，海外证人不应 “盲目” 以新冠疫情作为证人无法亲自到新加坡法庭参加庭审的理由。这是逐步回到 “常态” 的信号。
在这篇评论中，我们将探讨法庭在本案中的论述，以及本案对有意申请视频作证的海外证人的潜在影响。请点击这里阅读我们关于本案的中文评论。
Returning to the "Norm" – Singapore High Court Issues Guidance on the Giving of Evidence via Video-link amidst COVID-19 Pandemic
The General Division of the Singapore High Court in Wang Xiaopu v Koh Mui Lee and others [2022] SGHC 54 ("Wang Xiaopu") recently issued guidance on applications for overseas witnesses to give evidence via video-link in the context of the global recovery from the COVID-19 pandemic. Significantly, and as a signal of a return to the "norm", the Court cautioned against the "blind" citing of the COVID-19 pandemic as the reason why an overseas witness is unable to testify in person at trial before the Singapore courts.
In this Update, we explore the Court's reasoning in Wang Xiaopu as well as potential implications which litigants with overseas witnesses seeking to give evidence via video-link should be aware of. Please click here for our Update in English.
Singapore Court of Appeal Settles Controversy on When a Grant of Security to Cover Existing Indebtedness May Amount to a Transaction at an Undervalue
Upon the insolvency of an individual or company, the Court has the power to set aside transactions at an undervalue entered into by the insolvent party when or as a consequence of which it becomes insolvent. In Rothstar Group Ltd v Leow Quek Shiong [2022] SGCA 25, the Singapore Court of Appeal conclusively ruled on two longstanding questions relating to the law of undervalued transactions. The first is whether the grant of fresh security by an insolvent party for its existing indebtedness can ever amount to an undervalued transaction. The Court held that it cannot. The second is whether there is a difference if the grant of fresh security by an insolvent party is for the existing indebtedness of a third party. The Court held that there is – in this situation, the grant of security could amount to an undervalued transaction.
The case involved applications to set aside a legal mortgage entered into by a company and its shareholder as security for moneys owed by an associated company. The Court of Appeal allowed the applications and discharged the legal mortgage with prospective effect. The applicants were represented by Lee Eng Beng SC, Sim Kwan Kiat, Chua Beng Chye, Raelene Pereira, Torsten Cheong, Wong Ye Yang, Yeoh Su Yi, and Foung Han Peow of Rajah & Tann Singapore LLP.
Code of Conduct for Leasing of Qualifying Retail Premises (Updated 15 March 2022)
The Singapore Business Federation introduced a Code of Conduct for Leasing of Retail Premises in Singapore ("COC") on 26 March 2021. The COC was updated on 15 March 2022, with the amendments expected to take effect from 1 June 2022. The COC aims to provide a set of guidelines for landlords and tenants of Qualifying Retail Premises to enable a fair and balanced position in lease negotiation, and to provide such landlords and tenants with a governance framework to ensure compliance with an accessible dispute resolution framework.
This Update summarises the key features and principles of the COC, as well as the updates in the 15 March 2022 version.
MAS Notices on Financial Measures Relating to Russia Sanctions: Impact on Financial Institutions in Singapore
On 14 March 2022, the Monetary Authority of Singapore ("MAS") issued two MAS Notices to all financial institutions ("FIs") in Singapore detailing the financial measures imposed by the Singapore Government against designated Russian banks, entities and activities in Russia and fund-raising activities benefiting the Russian government and related parties.
- Notice SNR-N01 Financial Measures in Relation to Russia ("MAS Notice SNR-N01") sets out the activities and transactions that FIs are prohibited from engaging in.
- Notice SNR-N02 Financial Measures in Relation to Russia – Non-prohibited Payments and Transactions ("MAS Notice SNR-N02") sets out payments and transactions that are excluded from the scope of the financial measures in MAS Notice SNR-N01.
Taking effect on 14 March 2022, the MAS Notice SNR-N01 and the MAS Notice SNR-N02 apply to all FIs, including all banks, finance companies, insurers, capital markets intermediaries, securities exchanges and payment service providers (including digital payment token service providers). Failure to comply with the requirements in the MAS Notices is an offence.
This Update highlights the impact of the MAS Notices on FIs, summarising the key prohibited transactions and relevant exclusions for FIs' noting and necessary action.
The Future of Security in Digital Spaces – What New Compliance Obligations Can Online Platforms and Businesses Expect?
At the 2022 Committee of Supply Debates, the Minister of Communications and Information, Mrs Josephine Teo, presented a speech setting out the priorities of the Ministry in governing and securing Singapore's digital spaces, and gave an indication of what changes and enhancements may be expected in the digital regulatory and compliance framework, including: (a) the introduction of Codes of Practice against harmful online content; (b) the review of the Cybersecurity Act and update to the Cybersecurity Code of Practice; and (c) the strengthening of data protection safeguards.
In this Update, we look at the proposed changes and initiatives in the above areas and the new compliance obligations that may be expected in the near future. We also explore how these changes may affect online platforms and businesses.
SGX-Listed Issuers Must Review, Assess and Disclose Exposure or Nexus to Sanctions-Related Risks
The Singapore Exchange Regulation ("SGX RegCo") has issued a set of guidance notes on what an issuer should do if the issuer, or any person or entity closely associated with the issuer, is exposed to sanctions-related risks. An issuer refers to a company or other legal person or undertaking (including a real estate investment trust (REIT)) whose securities have been admitted to listing on the Singapore Exchange Securities Trading Limited (SGX-ST) or are the subject of an application for. The SGX RegCo guidance was issued following from an announcement by the Ministry of Foreign Affairs on 5 March 2022 which states that Singapore is imposing sanctions and restrictions against Russia in response to its invasion of Ukraine ("Russian Sanctions").
This Update provides a summary of the SGX RegCo guidance titled "Regulator's Column: What SGX expects of issuers in respect of sanctions-related risks, subject or activity" dated 7 March 2022 and distils the steps that an issuer has to take to comply with the SGX RegCo guidance with reference to the Russian Sanctions.
Key Changes to Policies for Foreign Workforce, Lower-Wage Workers
As the economy recovers from the ravages of COVID-19, businesses are starting to increase their hiring. Against this backdrop, Minister of Manpower Dr Tan See Leng announced in his Committee of Supply 2022 speech on 4 March 2022 that Singapore would be making several key changes to strengthen the complementarity and diversity of its foreign workforce, as well as provide greater clarity and certainty to businesses on foreign workforce policies.
Apart from the Minister's speech, there have been other recent announcements by the Ministry of Manpower (MOM) relating to Singapore's foreign workforce policies, as well as additional measures to advance the well-being of lower-wage workers.
In this Update, we cover the following developments:
- Changes to requirements for Employment Passes ("EP")
- Benchmarking of the minimum qualifying salary for EP holders; and
- Introduction of the new Complementarity Assessment Framework (COMPASS).
- Changes to requirements for S Passes
- Benchmarking of the cost of hiring an S Pass holder with reference to the qualifying salary and levy rates.
- Changes to restrictions in hiring foreign employees
- Updates to foreign workforce policies for the construction and process sectors, including phasing out the Man-Year Entitlement (MYE) framework;
- Introduction of the new Non-Traditional Source (NTS) Occupation List for the services and manufacturing sectors to allow businesses to hire S Pass holders on Work Permits; and
- Launch of the Manpower for Strategic Economic Priorities (M-SEP) scheme to allow qualifying firms some flexibility in hiring S Pass and Work Permit Holders ("WPHs").
- Other changes
- Enhanced coverage of mandatory medical insurance for S Pass and WPHs to better protect employers, who are liable for their employees' medical bills; and
- Introduction of the Progressive Wage Mark accreditation to support local lower-wage workers.
Court Rejects Bank's Claim for the Recovery of Monies Paid Under a Letter of Credit on the Basis of Fraud
The recent collapse of major oil traders in Singapore has resulted in a slew of litigation proceedings commenced by banks seeking to recover monies paid to beneficiaries under letters of credit. In Credit Agricole Corporate & Investment Bank, Singapore Branch v PPT Energy Trading Co Ltd [2022] SGHC(I) 1, the Singapore International Commercial Court upheld the independence principle in respect of letters of credit, applying a strict formulation of the fraud exception, i.e. that a bank is only entitled to refuse payment out under letters of credit where the beneficiary acts dishonestly, as opposed to recklessly, in the presentation of documents for payment.
The bank in this case had refused payment out under a letter of credit on the basis of fraud in the underlying round-tripping transactions. However, the Court found against the bank, finding that the beneficiary had not acted dishonestly, and was not required to make further queries regarding the transactions. This Update provides a summary of the decision and its implication on banks dealing with letters of credit and instances of suspected fraud.
Singapore Court Issues First "Persons Unknown" Order in Decision Involving Cryptocurrency
The cryptocurrency market has grown exponentially, with a global market value of about $2 trillion, and yet, its regulation and legal status continue to be subject to much debate and uncertainty. Are cryptocurrency assets considered to be property in the eyes of the law? Where does one even begin to seek legal remedy for stolen cryptocurrency in the borderless nature and anonymity of the internet?
These were some of the novel issues before the Singapore High Court in CLM v CLN and ors [2022] SGHC 46. In this exceptional case, the Court granted the first reported freezing injunction against "persons unknown" in Singapore for S$9.6 million worth of cryptocurrency assets stolen from the Plaintiff. The Plaintiff was successfully represented by our Fraud, Asset Recovery and Investigations team, led by Danny Ong and Jansen Chow of Rajah & Tann Singapore LLP.
New Simplified Track for Intellectual Property Litigation
The Ministry of Law ("MinLaw") has announced in a press release of 23 February 2022 that it will be implementing a new Supreme Court of Judicature (Intellectual Property) Rules 2022 ("new Rules"). The new Rules introduce (among other things) a simplified optional track for Intellectual Property litigation referred to as the "Simplified Process for Certain Intellectual Property Claims" ("Simplified Process").
The new Rules are expected to come into force on 1 April 2022. MinLaw has made available a draft version of the new Rules ("draft Rules") for interim reference, but the draft is subject to changes as it is currently undergoing the vetting process. This Update provides a brief summary of the Simplified Process as contained in the draft Rules.
Bills of Lading Signed by or on Behalf of the Master – Is it an Owner's Bill or a Charterer's Bill?
The identity of the contractual carrier in a bill of lading contract is a matter of importance. A bill of lading issued by shipowners (i.e. an owner's bill) is preferable, as it allows a cargo claimant to arrest the vessel carrying the cargo, as opposed to a bill of lading issued by a voyage or time charterer of the vessel (i.e. a charterers' bill). It is common in international trade for bills of lading issued to state they are signed by or on behalf of the Master, without expressly stating the identity of the contractual carrier, and for such bills of lading to be treated as having been issued on behalf of the owner (or demise charterer) of the vessel. However, the position under PRC Law may not be as clear as it may first appear.
The Supreme People's Court of the People's Republic of China has issued a judgment (2016 Supreme Court Civil Application No 530) in which it held that a bill of lading issued on behalf of the Master, but which did not otherwise identify the carrier, should be treated as having been issued on behalf of the time charterers (and not the owners) of the vessel. This Update looks at the reasoning of the decision and assesses the impact of the decision under PRC law, and whether a cargo claimant seeking recourse under a bill of lading may be deprived of its right to arrest the carrying vessel before the PRC Courts.
SGX RegCo's Expectations on Business Valuations & Disclosures
In the Regulator's Column on 1 March 2022, the Singapore Exchange Regulation sets out its expectations on valuations and what companies listed on the SGX-ST ("listed companies") must disclose about a valuation.
This Update highlights what listed companies and their boards of directors must be mindful of regarding business valuations of significant transactions and disclosures concerning valuations.
MAS Issues New MAS AML/CFT Notice for Financial Institutions Dealing in PSMs, Various Revised AML/CFT Notices for Financial Institutions and Variable Capital Companies
To better address money laundering and terrorism financing risks in the financial sector, the Monetary Authority of Singapore ("MAS") has issued:
-
A new MAS Notice on anti-money laundering and countering the financing of terrorism ("AML/CFT") for financial institutions dealing in precious stones, precious metals and precious products ("PSM AML/CFT Notice"); and
- Various revised MAS AML/CFT Notices applicable to FIs and variable capital companies,
collectively, "MAS AML/CFT Notices". The MAS AML/CFT Notices take effect on 1 March 2022.
The MAS AML/CFT Notices follow MAS' earlier consultation on this topic in July 2021. MAS also issued, on 1 March 2022, its Response to Feedback received on that consultation paper.
This Update briefly highlights some of the main features of the new PSM AML/CFT Notice, as well as some of the key new/revised AML/CFT requirements in various MAS AML/CFT Notices, such as: (a) the AML/CFT requirements relating to digital token services; (b) requirements relating to higher risk shell companies; (c) wire transfer and correspondent account requirements for credit card or charge card licensees; and (d) disclosure requirement for licensed trust companies and approved trustees.
Bill Introduced to Regulate Certain Digital Token Service Providers, Harmonise and Enhance MAS Regulatory Power over FIs
The Financial Services and Markets Bill ("FSM Bill") was tabled in Parliament for First Reading to implement a financial sector-wide regulatory approach for financial services and markets. The FSM Bill will consolidate the provisions and powers that relate to the Monetary Authority of Singapore's regulatory oversight of different financial institution classes in a single Act.
The FSM Bill contains provisions on the following key areas:
- Regulation of certain digital token service providers created in Singapore for anti-money laundering and countering of financing of terrorism purposes;
- Harmonised power to impose requirements on technology risk management;
- Harmonised and expanded power to issue prohibition orders; and
- Statutory protection from liability for mediators, adjudicators and employees of an operator of an approved dispute resolution scheme.
This Update provides an overview of these key areas to be regulated under the FSM Bill.
Singapore Announces Implementation of Sanctions Against Russia
On 5 March 2022, the Ministry of Foreign Affairs issued a Press Release together with two annexed Factsheets setting out the details of the Singapore Government’s sanctions against Russia in response to its invasion of Ukraine. Broadly, the current and anticipated sanctions are as follows:
- A ban on the export, transit, and transhipment to Russia of strategic military and high technology goods which can be used for both commercial and military purposes; and
- Prohibitions imposed on financial institutions in Singapore against dealing with, among other things, four designated Russian banks as well as fund-raising activities benefiting the Russian government.
This Update highlights what exporters, shippers, financial institutions, issuers listed on the Singapore Exchange Securities Trading Limited (SGX-ST) and other organisations in Singapore should take note of in navigating the rapidly evolving legal and regulatory changes arising from the sanctions imposed by the Singapore Government and other jurisdictions against the Russian government, and its banks and related entities.
An Employee's Breach of Fiduciary Duties and the Liability of Third Parties for Dishonest Assistance
When a company uncovers schemes perpetrated by one of its employees, a key question will be what recourse is available against the employee, and whether the company may also seek recourse against the employee's collaborators. This was the situation faced by the Singapore High Court in Sumifru Singapore Pte Ltd v Felix Santos Ishizuka [2022] SGHC 14.
The Court found that the 1st Defendant employee, in his role as shipping director and given his scope of functions, owed fiduciary duties to the Plaintiff employer, and had breached these duties by perpetrating various schemes against the interests of the Plaintiff. The Court further found the 2nd and 3rd Defendants, companies owned and controlled by the 1st Defendant, to be jointly and severally liable on the basis of dishonest assistance. The Plaintiff was successfully represented by Winston Kwek, Dedi Ahmad, Li Kun Hang and Dharini Ravi of Rajah & Tann Singapore LLP.
English Court of Appeal Determines Who is an 'Operator' of a Vessel under the Convention on Limitation of Liability for Maritime Claims 1976
In December 2021, the English Court of Appeal in Splitt Chartering APS & Ors v Saga Shipholding Norway AS & Ors [2021] EWCA Civ 1880 handed down a judgment which provides clarification on the threshold which a claimant is required to meet to be considered an 'operator' of a vessel in the context of the Convention on Limitation of Liability for Maritime Claims 1976 ("LLMC 76") as applicable under English law. The findings of the English Court of Appeal will be persuasive in the Singaporean context, where the LLMC 76 (with the 1996 Protocol) is likewise in force.
Additionally, this judgment highlights the importance of ensuring appropriate contractual arrangements between various business units in a group of companies that collectively manage or operate a vessel. While the purpose of the LLMC 76 is to encourage international trade by sea carriage, what this judgment indicates is also that the courts will be slow to apply an overly broad reading to the categories of parties entitled to limit their liabilities under the LLMC 76.
Developments on Russian Sanctions: Russian Banks Banned from SWIFT by EU
On 2 March 2022, the EU announced another wave of new EU sanctions to be adopted – the exclusion of seven Russian banks from the SWIFT international payment system. This follows from the EU’s earlier sanctions on Russian individuals and entities, its ban on exports, as well as restrictions on the supply of various strategic goods and services, including items used in the oil refinery and high-tech sectors. This Update looks at the scope of the EU’s recent measures, and what parties should be mindful of, particularly in relation to relationships with Russian banks.
And Never the Twain Shall Meet? - Nature and Extent of Overlap Necessary for a Litigation Case Management Stay in Favour of Arbitration
While litigation and arbitration are conceptually separate dispute resolution mechanisms, the Singapore Courts are empowered to order a case management stay of court proceedings in favour of either actual or anticipated arbitration proceedings in appropriate circumstances, and particularly where there is some or considerable overlap between the litigation and arbitration proceedings. In CJY v CJZ and others [2021] 5 SLR 569, the Singapore High Court considered and expounded upon how much of an overlap is sufficient, particularly as the court proceedings involved only one party to the arbitration (and five other non-parties to the arbitration).
The Court granted the stay of court proceedings sought by the First Defendant, demonstrating that a complete overlap is not required for the grant of a case management stay. The First Defendant was successfully represented by Gregory Vijayendran SC and Devathas Satianathan of Rajah & Tann Singapore LLP.
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