12 May 2015

Planting the Seeds for an International Rule of Law -The Commercial Court of England and Wales and the SICC

Reproduced from Practical Law with the permission of the publishers. For further information visit www.practicallaw.com or call 0207542 6664.

Contributed by Shaun Leong

 

The Singapore International Commercial Court (SICC) was launched on 5 January 2015 to complement international commercial arbitration services provided by the internationally recognised Singapore International Arbitration Centre and international commercial mediation services provided by the newly launched Singapore International Mediation Centre. The Commercial Court of England & Wales (Commercial Court), has more than a century old pedigree. This article compares the key features of the two courts, but ventures to surmise a common role which both courts may play in time to come.

The origins of the Singapore International Commercial Court and the English Commercial Court

The Singapore International Commercial Court (SICC) was launched at the Singapore's Opening of Legal Year Ceremony on 5 January 2015 to complement international commercial arbitration services provided by the internationally recognised Singapore International Arbitration Centre and international commercial mediation services provided by the newly launched Singapore International Mediation Centre.

Since 2009, Foreign Direct Investment (FDI) inflows into Asia have grown by 29.2% from US$315 billion to US$407 billion accounting for 30.1% of global FDI inflows in 2012 (United Nations Conference on Trade and Development (UNCTAD) World Investment Report (World Investment Report) 2012, Page 38 and World Investment Report 2013, Page xiii). (See also Report of the Singapore International Commercial Court Committee, November 2013). The Asian economy is expected to expand to at least three times its size from US$10.71 trillion to US$34.88 trillion from 2010 to 2020 (UOB Economic-Treasury Research Report, November 2012). The UOB Report also points out that the Asian economy will account for 32% of global GDP in 2020, up from 17% in 2010. Asia accounted for more than 30% of world trade in 2010, and is expected to account for 35% of world trade by 2020 (Profiting from Asia's Rise and from New Global Trade Flows, Boston Consulting Group). (See the Honourable the Chief Justice of Singapore Sundaresh Menon, International Commercial Courts: Towards a Transnational System of Dispute Resolution). With the growth in transnational trade comes the expectation that there will be an increasing need for dispute resolution services in the region. The SICC aims to service this need created by this.

The genesis of the Commercial Court of England & Wales (Commercial Court), which has more than a century old pedigree, is quite different. Towards the end of the 19th century, there was huge dissatisfaction among the mercantile community, especially in the City of London, with the administration of commercial justice in England because it took too long and was too expensive (R Hooley, The Commercial Court in England, Commercial - gional de formation professionnelle des avocats d'Alsace, Palais de l'Europe, Strasbourg, 4-6 December 1995, Council of Europe (R Hooley, The Commercial Court in England)). There was public criticism that the inefficiencies resulted in "a denial of justice" (Sir Sidney Waterlow, Report of the Judicature Commission, 1874). In response, the Queen's Bench set up, for the first time, a Commercial List in February 1895 dedicated to the administration of commercial cases. The first case on the list concerned an international case regarding a claim for an account brought by Flemish cloth manufacturers against their London agent. (See R Hooley, The Commercial Court in England.) About 75 years later, the Commercial Court was formally established in 1970 (as a distinct sub-division of the Queen's Bench Division) to be a specialist court with commercial expertise for the efficient and effective resolution of commercial disputes. From adversity arose a success story over the years, as the Commercial Court gained international repute among local and foreign litigants as an efficient court housed by commercially minded judges, which renders sound judgments of high quality. Today, the Commercial Court sits side by side with a thriving international commercial arbitration practice in London and plays an important role in entrenching London's status as a financial and business hub.

Their distinct origins underlie and influence the key differences between the Commercial Court and the SICC. This article compares the key features of the two courts, but ventures to surmise a common role which both courts may play in time to come as the SICC embraces its role.

Jurisdiction

Subject matter jurisdiction

While both the SICC and the Commercial Court are specialist courts set up to resolve commercial disputes, the subject matter jurisdiction of both courts are similar but not the same. The Commercial Court hears any claim arising out of the transaction of trade and commerce. This includes claims relating to:

  • A business document or contract.
  • The export of import of goods.
  • The carriage of goods by land, sea, air or pipeline.
  • The exploitation of oil and gas reserves or other natural resources.
  • Insurance and re-insurance.
  • Banking and financial services.
  • The operation of markets and exchanges.
  • The purchase and sale of commodities.
  • The construction of ships.
  • Business agency.
  • Arbitration.

(CPR 58.1(2).)

The SICC hears claims which arise from a relationship of a commercial nature, whether contractual or not, including the following transactions:

  • Any trade transaction for the supply or exchange of goods or services.
  • A distribution agreement.
  • Commercial representation or agency.
  • Factoring or leasing.
  • Construction works.
  • Consulting engineering or licensing.
  • Investment, financing, banking or insurance.
  • An exploitation agreement or a concession.
  • A joint venture or any other form of industrial or business cooperation.
  • A merger of companies or an acquisition of one or more companies.
  • The carriage of goods or passengers by air, sea, rail or road.

 (Order 110, rule 1(2)(b) of the Singapore Rules of Court (Cap 322, R 5, 2006 Rev Ed) (ROC).)

 The primary difference between the two courts is the Commercial Court's specific role as the supervisory court for London-seated arbitrations, which complements and supports the thriving international commercial arbitration practice in London. Arbitration related court applications and matters are heard by the Commercial Court in the first instance. This is not the case for the SICC, where the supervisory role remains, at least for the time being, with the High Court of Singapore. This might not be immune to change in the future, given that the criteria of an "international" dispute in the SICC is almost identical to the definition of an international arbitration under the International Arbitration Act (Cap. 143A) (IAA) (section 5(2), IAA). There is therefore consistency in subject-matter jurisdiction as prescribed for by the SICC and the scope of the IAA. As it presently stands, however, unless litigants expressly choose to refer their arbitration-related court proceedings to the SICC (or if the matter is transferred from the Singapore High Court to the SICC under the transfer mechanism), the SICC has no jurisdiction over IAA court cases.

International cases

The SICC is set up to hear and determine disputes which have very little or no connection with Singapore. It is not meant to determine disputes with a substantial domestic component, which would properly be heard in the High Court of Singapore. The SICC has jurisdiction to hear an international case where one of the following applies:

  • The parties to the dispute have, by a written jurisdiction agreement, agreed to submit the dispute for resolution by the SICC and, at the time the agreement was concluded, the parties have their places of business in different states.
  • None of the parties to the claim have their places of business in Singapore.
  • A substantial part of the obligation of the commercial relationship between the parties is to be performed in a place which is situated outside of any state in which any of the parties have their place of business.
  • The place with which the subject matter of the dispute is most closely connected with is situated outside of any state in which any of the parties have their place of business.
  • The parties to the claim have expressly agreed that the subject matter of the claim relates to more than one state.

The Commercial Court's jurisdiction is not so limited to hearing only international cases, though in practice it hears a substantial number of cases which are international in nature. Indeed, since 2010, around 80% of all cases each year involved at least one foreign litigant and all litigants are foreign in almost 50% of all cases. A study published in 2014 revealed that, between April 2013 and March 2014, more than 75% of Commercial Court users are from outside the United Kingdom with 24% of cases from Europe, 11% from the Middle East and North Africa, and about 11.5% from Eurasia including Russia and Kazakhstan (Portland Legal Disputes practice study, Who uses the Commercial Court?). (For more information on the meaning of "foreign", see Ministry of Justice Series 2015, Factors Influencing International Litigants' Decisions to Bring Commercial Claims to the London Based Courts.)

Consensual jurisdiction

The jurisdiction of many municipal courts is founded upon some form of substantial connection between the dispute and the jurisdiction. This applies to the Commercial Court as well (CPR 6.32-6.35), although a significant proportion of its case load derives from the consent of parties. (The Honourable the Chief Justice of Singapore Sundaresh Menon, International Commercial Courts: Towards a Transnational System of Dispute Resolution).

The SICC seeks to attract disputes that have little or no nexus with Singapore. As such, the jurisdiction of the SICC is primarily consensual in nature. Parties must have consented to refer disputes to the SICC, either pre-dispute via a SICC dispute resolution clause in their contract or by forming a post-dispute agreement. The dispute resolution clause in the relevant contract should refer specifically to the Singapore International Commercial Court because a jurisdiction clause referring disputes to the High Court of Singapore does not constitute an agreement to submit to the jurisdiction of the SICC (Order 110, rule 1(2)(c), ROC).

However, in the following two exceptional circumstances the court may assume compulsory jurisdiction:

  • Once a case has been commenced in the SICC, a third party may be joined by a court order without the third party's consent (Order 110, rule 9, ROC), provided that the traditional jurisdictional gateways have been met, for example, where the party sought to be joined has presence in Singapore, or where the cause of action relates to a contract made in Singapore or where the breach occurred in Singapore (Order 11 rule 1, Order 15 rule 3(2), Order 16 rule 3(3), ROC).
  • Cases from the High Court can be transferred to the SICC even if all parties object, after having heard the objections from the parties.

In theory, there could therefore be a case where non-consenting third parties are joined to a case which was transferred from the High Court. It is envisaged that this would not happen often (if at all), in line with the underlying philosophy of the SICC to primarily exercise consensual jurisdiction.

In England and Wales, parties may apply to transfer a case from other lists to the Commercial Court (Practice Direction (PD) 58.4.1-4.2).

Forum non conveniens and choice-of-law rules

Traditionally, the High Court of Singapore would regard the existence of a jurisdiction clause as a strong factor, but not a conclusive one, to take into consideration in determining the appropriate forum to hear the dispute. If there is a clause that confers the exclusive jurisdiction to hear the dispute on a foreign court, the Singapore courts may exercise their discretion to assume jurisdiction only if strong cause can be shown that the matter should not be placed before that selected foreign court and should instead be determined by the Singapore courts (Orchard Capital I Ltd v Ravindra Kumar Jhunjhunwala [2012] SGCA 16). On the other hand, the treatment of arbitration clauses is quite different. It is mandatory for the Singapore courts to stay court proceedings in favour of international arbitration if the dispute is found to fall within the scope of the arbitration agreement, unless the agreement is shown to be null, void, inoperable or incapable of being performed (section 6, IAA). There is no discretion, whether strong cause is shown or not, for the court to assume jurisdiction over the dispute in such cases (Tjong Very Sumito and other v Antig Investments Pte Ltd [2009] 4 SLR(R) 732).

The treatment of SICC dispute resolution clauses may be more inclined towards the mandatory position accorded to arbitration clauses. The rules prescribe that the SICC must not decline to assume jurisdiction in an action on the sole ground that the dispute between the parties is connected to a jurisdiction other than Singapore, if there is a written jurisdiction agreement between the parties (Order 110, rule 8, ROC).

Indeed, arguments made by the party disputing the SICC's jurisdiction on the basis that the dispute is substantially connected with a foreign jurisdiction may not hold much (if any) weight before the SICC, as the SICC is tailor-built to attract and resolve disputes which have very little or no connection at all with Singapore. If the SICC is to be an international court in the truest sense, the doctrine of forum non conveniens is likely to have little relevance.

For the same reasons, the concept of the lex fori may require detailed consideration. To the extent that the juridical basis of the SICC would necessarily lie within the province of Singapore's legal framework, Singapore's choice-of-law rules would still have compelling force. However, the decisions and judgments rendered by the SICC may over time be applied by commercial courts of other jurisdictions such that its decisions and judgments may in time find a place within an international and autonomous body of law, independent from any existing set of domestic legal norms. Where this happens, the traditional choice-of-law analysis may not necessarily apply with as much force in the SICC.

Rules and procedures

Forum hearing interlocutory matters

All interlocutory applications are heard and determined by a judge in both the Commercial Court and the SICC. This obviates a layer of appeals from the registrar (in the High Court) or master (from the Queen's Bench Division) to the judge, and has the advantage of efficiency from having the same judge manage the case throughout.

Case management

Just as in the Commercial Court, cases in the SICC are expected to be managed robustly with the use of case management conferences. Case management conferences are conducted by a judge in the Commercial Court. This would generally be the case in the SICC, although registrars could assist with case management conferences from time to time. All parties attending a case management conference must complete a case management information sheet in the Commercial Court (Admiralty and Commercial Courts Guide (ACC Guide), paragraph D8.5) or a similar proposed case management plan form in the SICC (paragraph 81, SICC Practice Directions). Other key case management tools common to both courts are the use of a Case Memorandum where parties are required to set out a short and uncontroversial description of what the case is about, and a short and uncontroversial summary of the material procedural history of the case (ACC Guide, paragraph D5.1; paragraph 79, SICC Practice Directions). In addition, each party is required to prepare a list of the principal issues of fact and law in a structured manner (for example, by reference to headings or chapters), including a section which sets out the common ground facts or issues agreed upon by parties (ACC Guide, paragraph D6.1; paragraph 80, SICC Practice Directions).

Default judgments

Default judgments are available in the Commercial Court (CPR 58.8). In the SICC, the Singapore Rules of Court (Cap 322, R 5, 2006 Rev Ed) would by default apply to all proceedings in the SICC subject to any specific rules expressly provided for in Order 110 of the Rules of Court (Order 110, rule 3, ROC). As such, the judgments in default mechanism under Order 13 of the Rules of Court is applicable to the SICC.

Multi-party proceedings

The Commercial Court has specialised rules to deal with multi-party disputes (ACC Guide, Section L1). In particular, the court has broad powers to manage a multi-party dispute, including powers to consolidate proceedings, dispense with statements of case, direct parties to serve outline statements of case, direct that certain cases or issues be determined before others and to stay other proceedings in the interim (ACC Guide, paragraph L.2). The SICC has similar powers, including the power to consolidate matters (Order 4, ROC), to order causes of action to be joined (Order 15, ROC), and more general case management powers (Order 34A, ROC).

Foreign law

As set out in a 2015 report by the Ministry of Justice, litigation in the Commercial Court under a foreign law is considered rare. In fact, a main reason that international disputes are litigated in the Commercial Court is parties' preference to select English law as the governing law of their dispute (Ministry of Justice Series 2015, Factors Influencing International Litigants' Decisions to Bring Commercial Claims to the London Based Courts).

In the SICC, unlike the conventional High Court proceedings, there is no requirement to prove foreign law as fact (Order 110, rule 26, ROC). This means that costs and time need not be expended on having foreign law expert opinions, and the SICC would not invariably adopt the artificial presumption that the foreign law is equivalent to Singapore law if the former is not proved. The SICC can simply receive submissions on points of foreign law with assistance from foreign counsel and foreign law authorities. In addition, an international judge with the requisite expertise in the question of foreign law can be appointed to hear the case.

Disclosure

The disclosure framework in the Commercial Court is similar to that of the Singapore High Court but different from the disclosure framework in the SICC. In the Commercial Court, the process of standard disclosure requires parties to disclose documents which are relied upon, and documents which adversely affect either party's case or support another party's case (CPR 31.5; ACC Guide, paragraph E2.2). This parallels the process of general discovery in the Singapore High Court (Order 24, rule 1, ROC). The Commercial Court may dispense with or limit standard disclosure where appropriate (ACC Guide, paragraph E2.1(ii)). Specific disclosure is also available in the Commercial Court where the court may direct a party to carry out a thorough search for and disclose any documents which it is reasonable to suppose may adversely affect his own case or support the case of the party applying for disclosure, or which may lead to a train of enquiry which has either of these consequences (CPR 31.12; ACC Guide, paragraph E4.2). This parallels the process of specific discovery in the Singapore High Court (Order 24, rule 5, ROC). The Lord Chief Justice of England and Wales asked in late 2013 for a study to be made of the challenges faced by the Commercial Court. The study found that more than 20% of the respondents expressed concerns over the case management and disclosure process (Law Society Gazette, News focus: Commercial Court). The study also found that the rising cost of litigation in the Commercial Court was a huge point of concern, and about 23.5% of the respondents found the court's use of technology to be unsatisfactory.

In the SICC, the documentary disclosure framework of the High Court has been disapplied (Order 110, rule 21, ROC). There is therefore no process of general discovery. Instead, there is a more flexible and less onerous disclosure regime which is broadly based on the discovery framework found in the International Bar Association (IBA) rules. A litigant has no obligation to disclose documents which are immaterial to the outcome of the case where it would be an unreasonable burden to produce them, or where the court finds it compelling to prevent disclosure in order to protect commercial, technical or confidential interests (Order 110, rule 17, ROC). Disclosure would not be ordered where it could be shown (with reasonable likelihood) that documents have been lost or destroyed (Order 110, rule 17(2)(b)(iv), ROC). The court may take into consideration principles of "procedural economy, proportionality, fairness or equality" in deciding whether to order disclosure (Order 110, rule 17(2)(b)(vii), ROC). In addition, the court may order that any rule of evidence found in Singapore law (such as those under the Evidence Act (Cap. 97)) be disapplied, and replaced with other appropriate rules of evidence, including those more familiar to civil law jurisdictions (Order 110, rule 23, ROC).

Confidentiality

Proceedings in the Commercial Court are not confidential, in line with the constitutional principle of open justice. The exception, which rarely happens in practice, would be if confidentiality is genuinely necessary in the interests of justice (Bank Mellat v Her Majesty's Treasury (Nos. 1 and 2) [2013] UKSC 38 and UKSC 39).

In the SICC, court proceedings can be made confidential on the application of a party. The court may order that the dispute be heard in camera, or that no person can reveal or publish any information or document relating to the case, and that the court file be sealed. (Order 110, rule 30, ROC.) The SICC may make a confidentiality order to protect commercial interests, especially in "offshore" cases as well as cases where parties have entered into a confidentiality agreement (Order 110, rule 30(2), ROC). Where the SICC judgment is of major legal interest, the SICC could publish the judgment with appropriate redactions (Order 110, rule 31, ROC).

Appeals

There is no separate "SICC Court of Appeal" to hear appeals from the SICC. Appeals will be heard by the Court of Appeal of Singapore (the apex Court in Singapore) and administered under a dedicated SICC list of appeals. A bench of up to five judges comprising both local and international judges (as listed below) may sit to hear a SICC appeal.

Parties can, by consent, customise and restrict the scope of an appeal against a decision of the SICC. The rules prescribe that, "In relation to any agreement between the parties to restrict or limit the right to appeal: (a) If the parties agree in writing to waive, limit or vary the right to appeal against any judgment or order of the Court, an appeal may be brought only to the extent as agreed between the parties. (b) If the parties agree in writing that there shall be no appeal against any judgment or order of the Court, such judgment or order shall be binding on the parties and no appeal shall lie against it" (paragraph 139(3), SICC Practice Directions).

The precise ambit of restricting the scope of appeal or review is not set out in the rules, and would perhaps be clarified in a "test case". It may be that litigants seek to restrict appeals only on manifest errors of fact and/or law, or on jurisdictional grounds.

Appeals from the Commercial Court are heard by the Court of Appeal of England & Wales. The appellant must as a general rule seek permission to appeal (CPR 52.3(1)), and this may be sought from the Commercial Court or the Court of Appeal (CPR 52.3(2)). There are no equivalent provisions which relate to the restriction of the scope of appeal in the rules for appeals from the Commercial Court. Appeals may be sought to review the merits of the Court's decision on errors of fact and/or law (there are restrictions for appeals against findings of fact), although permission to appeal would only be granted if the court considers that the appeal would have a real prospect of success or if there is some compelling reason that the appeal should be heard (CPR 52.3(6)). Appeals are generally heard by a Court of 3 Lord/Lady Justices of Appeal (some cases may be heard by a Court of two). Where permission is granted, a further appeal may be made to the Supreme Court of the United Kingdom (Supreme Court Rules, Part 2), which would be heard by a Court of 5 or up to 9 Judges.

Judges

There are at present 16 Admiralty and Commercial Court judges, including Flaux J, the judge in charge of the Commercial Court (see MoJ, Admiralty and Commercial court judges list).

Along with the Chief Justice of Singapore, Judges of the Supreme Court and Senior Judge Chan Sek Keong who are on the SICC Panel of Judges, the following people appointed as international judges can sit on both the SICC and the Court of Appeal:

  1. Mr. Dyson Heydon AC QC (Australia), former Judge of the High Court of Australia.
  2. Justice Patricia Bergin (Australia), Chief Judge in Equity of the Supreme Court of New South Wales.
  3. Mr. Roger Giles (Australia), former Judge of the Court of Appeal of the Supreme Court of New South Wales and sitting Judge of the DIFCC.
  4. Dr. Imgard Griss (Austria), former President of the Austrian Supreme Court.
  5. Justice Dominique Hascher (France), Judge of the Supreme Judicial Court of France.
  6. Mr. Anselmo Reyes (Hong Kong SAR), former Judge of the Court of First Instance in Hong Kong and Judge in charge of the Construction and Arbitration, Commercial and Admiralty Lists.
  7. Professor Yasuhei Taniguchi (Japan), Professor Emeritus at Kyoto University and former Chairman and Member of the Appellate Body of the World Trade Organisation.
  8. Sir Bernard Rix (England & Wales), former judge in charge of the Commercial Court and former Lord Justice of Appeal in the Court of Appeal of England & Wales.
  9. Sir Vivian Ramsey (England & Wales), former judge of the High Court of England & Wales (Queen's Bench Division) and judge in charge of the Technology and Construction Court.
  10. Mr. Simon Thorley QC (England & Wales), a lawyer who practices in intellectual property law, and former Deputy High Court Judge in England & Wales; Deputy Chairman of the Copyright Tribunal in the UK.
  11. Ms. Carolyn Berger (US), former Justice of the Supreme Court of Delaware and former Vice-Chancellor of the Delaware Court of Chancery.
  12. Sir Henry Bernard Eder (England & Wales), former judge of the Commercial Court of England & Wales.

The inclusion of judges trained in the civil law tradition is meant to strengthen the SICC's ability to resolve disputes governed by a law from a civil law jurisdiction. This is especially pertinent given that Singapore is located in a region with diverse legal traditions.

Unlike international arbitration, parties would not be able to nominate and appoint the bench. A three-judge court would hear the case if all parties so agree, unless the Chief Justice directs otherwise, or where the Chief Justice directs that the case be heard and determined by a three-judge court (paragraph 23, SICC Practice Directions). The rules do not prescribe any limit to the number of international judges on the three-judge court.

Foreign (international) representation

Legal representation in the Commercial Court largely comprises barristers practising in London, and occasionally solicitor-advocates with rights of audience.

In the SICC, international lawyers who are not qualified in Singapore can have rights of audience before the SICC and even before the Singapore Court of Appeal (the SICC list) upon registration in offshore cases. An offshore case is one which has no substantial connection with Singapore. A case has no substantial connection with Singapore if either:

  • Singapore law is not the law applicable to the dispute and the subject matter of the dispute is not regulated by, or otherwise subject to, Singapore law.
  • Where the only connections between the dispute and Singapore are the parties' choice of Singapore law as the law applicable to the dispute and the parties' submission to the jurisdiction of the court.

(Order 110, rule 1(2)(f), ROC.)

The registration of foreign lawyers framework in the SICC would be a more liberal and faster process than the conventional framework in the High Court of Singapore. In the latter, only Queen's Counsel (from a common law jurisdiction) or a senior lawyer of equivalent standing from a non-common law jurisdiction may apply for ad hoc admission in the High Court. The decision of the High Court on the admission application is subject to an appeal to the Court of Appeal. In the SICC, parties may obtain a "pre-action" certificate to conclusively certify that its case is an offshore case which would allow for international legal representation. Where there is no such certificate and there is a dispute as to whether the case is an offshore one, the court's decision on whether it is an offshore case is a final and non-appealable decision.

In the face of the diversity in international representation, with lawyers coming from myriad legal traditions and jurisdictions, the SICC requires registering lawyers to undertake to abide by an SICC Code of Ethics. The code, which is crafted with the IBA guidelines on party representation in international arbitration in mind, seeks to ensure that international lawyers abide by a common objective benchmark for ethical conduct. Some of the key features of the code include:

  • The general prohibition against ex parte communication with the court (section 7, SICC Code of Ethics).
  • The obligation to inform the client of the need to preserve relevant documents (section 10(1), SICC Code of Ethics).
  • The obligation not to make disclosure applications or raise objections to a disclosure request for an improper purpose, such as to harass or cause delay (section 10(2), SICC Code of Ethics).
  • The obligation to advise and assist the client to take reasonable steps to ensure that they produce every document they are ordered by the court to produce (section 10(4), SICC Code of Ethics).
  • The obligation to ensure that the witness statement reflects the witness's own account of the facts (section 12(2)(a), SICC Code of Ethics).
  • The extent of communication allowed with witnesses who are under cross-examination (section 13, SICC Code of Ethics).

Enforceability

As a division of the Singapore High Court, a judgment of the SICC is a national court judgment, with the same enforceability as a judgment of the Singapore High Court. Existing reciprocal enforcement treaties with common law jurisdictions are applicable (for example, the Reciprocal Enforcement of Commonwealth Judgments Act covers the UK, Australia, New Zealand, Malaysia, Brunei, Pakistan, Sri Lanka, Papua New Guinea and India (except the states of Jammu and Kashmir), while the Reciprocal Enforcement of Foreign Judgments Act covers Hong Kong SAR). Enforcement in other countries would generally be by commencing a cause of action for a judgment sum in the enforcement court, exhibiting the SICC court judgment, subject to the other requirements of that enforcement forum. The same can be said of Commercial Court judgments.

An international arbitral award is recognised and enforceable in more than 150 countries via the New York Convention. The SICC may look at the innovative mechanism of the Dubai International Financial Centre Courts (DIFCC) to convert a judgment into an arbitration award, via parties' consensual referral of a dispute over the payment or enforceability of a judgment to a sole arbitrator administered by LCIA (DIFC Court Practice Direction No. X of 2014 amending Practice Direction No. 2 of 2012). When this dispute is determined, an award made would be enforceable under the New York Convention.

The SICC Committee recommended that Singapore considers acceding to the Hague Convention on Choice of Court Agreements to enhance the international enforceability of SICC judgments. Following from this, the Singapore Ministry of Law considered and made consultations on the recommendation. Singapore signed the Hague Convention on Choice of Court Agreements in a council meeting on 25 March 2015 (see HCCH, Singapore signs the 2005 Choice of Court Convention). This would be the first of a two-step process for Singapore to become a party to the Convention (the second step being ratifying the Convention).

At present, Mexico has ratified the Convention and the USA has signed it. The EU Council on 10 December 2014 approved the decision to ratify the Convention (EU Council Decision 2014/887/EU), and it will come into force for the EU when the instrument of ratification is deposited in mid-2015 (scheduled to take place within a month after 5 June 2015) (Article 27, Hague Convention on Choice of Court Agreements(the Convention)). It appears that Singapore is likely to ratify the Convention after it comes into force. The enforceability of the judgments from the Singapore High Court and the SICC would be enhanced if Singapore decides to ratify the Convention.

With regard to a judgment obtained from the Commercial Court, the mechanisms to enforce the judgment significantly differs depending on whether enforcement is sought in (1) an EU member state, (2) a jurisdiction which has a reciprocal enforcement treaty with the UK, or (3) a jurisdiction where no reciprocal enforcement treaty is applicable.

If an uncontested judgment of the Commercial Court has been obtained (which is one where the claim is uncontested), the judgment may be enforced in an EU member state via straightforward procedures under the European Enforcement Order mechanism without the need for a declaration of enforceability. Otherwise, the judgment may be enforced in an EU member state via the 2001 Brussels Regulation, Recast Brussels Regulation and 2007 Lugano Convention. With this, an application has to be made to the enforcement court for a declaration of enforceability, after which the specific enforcement procedures would depend on the enforcement rules of each EU member state.

Outside of the EU, a judgment of the Commercial Court may be enforced by way of registration, if the enforcement jurisdiction has a reciprocal enforcement treaty with the UK, via the Administration of Justice Act 1920 and the Foreign Judgments (Reciprocal Enforcement) Act 1933. These generally cover commonwealth countries and common law jurisdictions such as Singapore, Australia, Canada and India.

Where the EU mechanisms and reciprocal treaties are not applicable, enforcement would have to be pursued via the general law of the enforcement jurisdictions. The precise procedures would depend on the specific rules of the enforcement jurisdiction, but it would not be uncommon to expect that a cause of action for a judgment debt would have to be commenced.

Conclusion: the international significance of the London Commercial Court and the SICC

Since the advent of international commercial arbitration, the international commercial community has had the benefit of a mechanism to resolve cross-border disputes with due process (where the procedure to resolve the dispute is selected by consent), flexibility (the ability to select a tribunal with the requisite expertise and to customise the procedural arbitral rules appropriately), finality (of decisions) and certainty in enforceability within a framework that respects parties' confidential commercial interests. International commercial arbitration has thus played a fundamental role in setting the proper foundations for the rule of law to flourish in the international commercial realm. Nevertheless, this role has arguably been limited by the general confidentiality of arbitration and the lack of binding precedents among arbitral awards.

The SICC may build upon the foundations that are already laid by international commercial arbitration. To the extent that the decisions of the SICC are of a high quality, it is not impossible to imagine international commercial courts from other parts of the world giving persuasive weight to decisions rendered by the SICC, and vice versa. As it is, this is not entirely impossible even now if the facts of the cases are similar and the issues governed by the same law. With time, this could signal the beginning of a judicial chain of international commercial courts where the decisions of the Commercial Court of England & Wales, SICC, DIFCC, Qatar International Financial Courts, and perhaps upcoming International Commercial Courts (yet to be set up) would come to influence each other and gradually form a free-standing autonomous body of substantive international commercial law. Seen in this light, the SICC is an attempt to internationalise the rule of law for the benefit of the international commercial community to guide legal obligations arising from cross-border trade.

Even before the SICC was established, the Singapore courts accorded due consideration to international norms found in authorities from various jurisdictions in the determination of international arbitration related disputes. The Singapore Court of Appeal (PT First Media TBK (formerly known as PT Broadband Multimedia TBK) v Astro Nusantara International BV and others and another appeal [2014] 1 SLR 372) considered extensively English authorities to determine if an arbitrant had a "choice of remedies" between setting aside and challenging the enforceability of an international arbitration award, even if the question relates to a domestic international award. The Singapore High Court found persuasive the decisions from UNCITRAL Model Law jurisdictions to determine the threshold for finding the existence of an arbitration agreement to stay local court proceedings (The "Titan Unity" [2013] SGHCR 28), and recently gave grounds to justify why an English Court of Appeal decision (SulAmérica Cia Nacional De Seguros S.A. and others v Enesa Engenharia S.A. [2012] 1 Lloyd's Rep 671) should be departed from to determine the law governing an international arbitration agreement (FirstLink Investments Corp Ltd v GT Payment Pte Ltd and others [2014] SGHCR 12). The significance of international norms would arguably increase with the set-up of the SICC. To the extent that the arbitration-related decisions from the international commercial courts of the world influence one another, a coherent body of lex arbitralis materialis jurisprudence on principles of international arbitration could be developed with time.

Neverthelesss, there are real challenges which the SICC must overcome. The SICC is as yet an untested product. Corporates, general counsel and users of dispute resolution mechanisms would have to be convinced that the model dispute resolution clauses they have used for their international contracts in the past decades should now be amended and replaced with an SICC dispute resolution clause. Even where this could be done, it is likely to take a few years before disputes arise from such international contracts. However, with the international success of the SIAC, Singapore is not an unknown brand in the world of dispute resolution. The author spoke on the SICC and the rule of law at the Global Law Summit in London on 23 and 24 February 2015 as part of the 800th anniversary celebrations of the Magna Carta, accompanied by colleagues from across the civil and common law traditions. The audience of about 200 people were surveyed on their most preferred forum of dispute resolution. Despite the fact that the SICC is as yet an unknown product (indeed, the first SICC case which involves a US$800 million dispute between BCBC Singapore and PT Banyan Resources over alleged breaches of a joint venture agreement for the application of a patented technology to produce coal from East Kalimantan, Indonesia, was listed as of 10 May 2015), the SICC did not come in last in the survey. It gathered 9% of the audience’s votes. There therefore appears to be international recognition and assured confidence in the institutional strengths associated with Singapore and this could perhaps serve as a platform for the future development of the SICC.

Judith Gill QC +44 20 3088 3779
Partner, London judith.gill@allenovery.com
Andrew Battisson +65 6671 6089
Counsel, Singapore andrew.battisson@allenovery.com
Andrew Pullen
City andrew.pullen@allenovery.com
Shaun Leong +65 6671 6093
Associate, Singapore shaun.leong@allenovery.com

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