It has now been two years since the Singapore International Commercial Court (“SICC”) was established as an alternative forum to resolve international commercial disputes in Singapore. There are three institutions in Singapore capable of resolving international commercial disputes – it is a veritable cocktail of dispute resolutions services.

London may still dominate cross-border commercial litigation, but it is no longer the default. The SICC has proven that it is able to quickly resolve complex disputes of substantial value. Rebecca LeBherz and Zoe Walker examine where the SICC is now, and what it achieved in its first two years.

A flavour of the SICC’s judgments so far

Since its launch, the SICC has handed down eight judgments, some involved Australian parties and judges.

BCBC Singapore Pte Ltd & Anor v PT Bayan Resources TBK & Anor [2016] SGHC(I) 01

The first decision of the SICC involved Australian, Indonesian and Singaporean entities. It was a US$800 million contractual dispute with a complex factual matrix, which related to a novel coal mining process. The matter was originally heard in the High Court of Singapore but was transferred to the SICC 4 March 2015 and argued in November 2016. The first hearing related to contractual construction and issues of Indonesian law, while some issues were left to be determined at a later stage.

The hearing concluded six days earlier than expected on 26 November 2015. The SICC handed down its decision 12 May 2016 – just over a year after it was transferred from the Singapore High Court to the SICC and less than six months after it was heard.

Teras Offshore Pte Ltd v Teras Cargo Transport (America) LLC [2016] SGHC(I) 02

This ongoing case has involved several claims and counterclaims that arose in relation to liquefied gas projects in, or close to, Queensland, Australia. The parties were from Singapore and the United States. Two applications were decided by Justice Henry Eder:

  • The first related to an application that the SICC declare the matter as an “offshore case”, which would enable foreign legal representation. Eder J decided that whether or not an action is an “offshore case” must be determined by reference to the particular action, not just the dispute. The fact that witnesses, premises, documents and servers were located in Singapore was found to indicate a “procedural or administrative” connection with Singapore, but not a “substantial” one. Further, Eder J found that the following factors were irrelevant:

a) that the Plaintiff was a Singapore company;

b) that the Plaintiff had assets in Singapore that were not the subject of dispute; and

c) that money had passed through the Plaintiff’s bank account in Singapore.

Interestingly, in accordance with the Rules of the Court, it was noted that even though the contracts were governed by Singapore law and the parties had submitted to the jurisdiction of the Court, those were not factors that created a substantial connection. The case was declared to be an “offshore case”.

  • An application for summary judgment, which was dismissed because the issue required a determination on factual issues and could not be determined summarily.

Reasons for Eder J’s decision were handed down 15 days after argument.

Telemedia Pacific Group Ltd & Anor v Yuanta Asset Management International Ltd & Anor [2016] SGHC(I) 03

Justice Patricia Bergin, former Judge of Appeal of the Supreme Court of New South Wales, delivered a judgment of over 200 pages 14 months after the case was transferred to the SICC by consent and only four months after it was argued. The case was complex and involved parties from companies incorporated in the British Virgin Islands and the individuals behind them, citizens of Hong Kong and the Dominican Republic. The dispute arose from the breakdown of a securities and investments joint venture. The Plaintiffs’ primary claim was based on breach of contract and fiduciary duties. In response, the Defendants’ denied those claims and counterclaimed, arguing the Plaintiffs improperly used joint venture funds.

Lawyers from all nations

Since its commencement, judges have been appointed to the SICC from both common and civil law countries all over the globe, including Singapore, the United States, Australia, Austria, France, England, Hong Kong and Japan.

The judges have diverse academic and juridical backgrounds, but all have a commercial focus. Some examples are:

  • Justice Chan Seng Onn (an acting Singapore High Court Judge) was previously Singapore’s Solicitor-General, but also holds a Masters of Science in Industrial Engineering.

  • The Honourable Justice Carolyn Berger has over 30 years’ experience on the bench in Delaware – arguably, America’s busiest corporate law jurisdiction.

  • The Honourable Justice Dominque Hascher is currently a Judge of the Supreme Judicial Court in France and has been the General Counsel and Deputy Secretary General of the International Chamber of Commerce International Court of Arbitration.

Just as the bench is international, so too are the legal representatives that can appear before it. Foreign lawyers must be granted either a full or restricted registration to appear before the SICC. A full registration enables a lawyer to appear and plead in any “relevant proceeding”, which means the parties have, jointly, requested foreign representation, or where the Court has ordered the case be treated as an “offshore case” (see Teras Offshore v Teras Cargo above). A lawyer with a restricted registration, however, may only make submissions, in certain cases, on matters of foreign law as permitted by the SICC.

In the SICC’s inaugural case, Indonesian lawyers were granted restricted registrations and made submissions on specific questions of Indonesian law and even addressed the Court directly. This is particularly interesting as, typically, lawyers do not have the right to appear before foreign courts. In total, 76 foreign advocates have been granted full registrations, including 13 Australian barristers.

Timing

Just as the first three cases delivered by the SICC were handed down expeditiously, so to were the ones that followed. All other decisions have been handed down within three months of the hearing – some have been handed down less than a month after being argued.

Benefits of the SICC

The SICC has been well received by the international legal community due to the quality of judges and judgements. The SICC provides a number of advantages, especially when compared to arbitration which has drawn criticism in recent years for being expensive and subject to delays.

Other interesting benefits of SICC proceedings include that:

  • parties can apply for the proceedings and judgment to remain confidential.

  • third parties can be joined – a procedure not available in arbitration because arbitration clauses bind only the parties that agreed to them, which means parties that ought to be involved in the resolution of a dispute may not be obliged to join.

  • the Singapore rules of evidence do not, in all cases, have to be applied and questions of foreign law can be decided by submission rather than proof, which may, in some cases, expedite proceedings.

  • the SICC’s judgement turnaround is proving to be quick and reliable.

What might hinder the long-term success of the SICC?

One foreseeable issue with SICC decisions is that they are only enforceable if the country in which enforcement is being sought has a treaty with Singapore decreeing that foreign judgments are to be recognised and enforced. Currently, Commonwealth countries and the US have reciprocity arrangements with Singapore.

That concern may be allayed if the Hague Choice of Court Convention, which came into force 1 October 2015, gains traction. It provides for signatory States to respect choice of jurisdiction clauses and so further legitimises international litigation and the decisions handed down by international commercial courts, like the SICC. Few States have signed the convention, and even less have ratified it. This is compared to the popular support of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, which has been ratified by 157 States.

Even so, the SICC has attracted complex and high-value disputes and its share of the market is likely to continue to expand.