Legal Updates

Ministry of Law launches public consultation on allowing appeals to the High Court on questions of law arising from an arbitral award and other proposed amendments to Singapore’s International Arbitration Act.

04.07.2019 | Litigation and Dispute Resolution

Background

The Ministry of Law (MinLaw) has launched a public consultation to receive feedback on proposals to amend the International Arbitration Act (“IAA”). In its consultation paper, MinLaw has invited members of the public to provide feedback on a draft IAA Bill which, most notably, proposes the insertion of provisions to provide the option for parties to incorporate a right to appeal to the High Court on a question of law arising out of an award made in the proceedings, where parties have agreed to opt in to this mechanism.

Proposed Amendments to IAA

One of the key proposals in the public consultation which MinLaw has invited feedback on concerns proposed amendments which would give a party to arbitral proceedings (where IAA applies) a right to appeal to the High Court on a question of law arising out of an award made in the proceedings.

Under the current IAA framework, a party to arbitral proceedings does not have a right to right to appeal to the High Court on a question of law, and may only apply to the High Court to set aside an arbitral award on limited grounds, such as lack or excess of jurisdiction, procedural irregularity, fraud, corruption and breach of natural justice.

Under the new sections 24A to 24D proposed under Clause 6 of the draft IAA Bill, parties have an option to incorporate a right to appeal to the High Court on a question of law arising out of an award. Parties would have to agree in writing to opt-in to this mechanism and also obtain leave of court. The application for leave of court must be filed within a specified time limit.

The draft IAA Bill also contains the following proposed amendments:-

  • Introducing a default mode of appointment of arbitrators in multi-party situations;
  • Allowing parties by mutual agreement to request the arbitrator or arbitrators to decide on jurisdiction at the preliminary stage; and
  • Recognizing that an arbitral tribunal and the High Court have powers to enforce obligations of confidentiality in an arbitration;

MinLaw has also invited feedback on the following other proposals contained in the public consultation:-

  • Allowing parties to, by agreement, waive or limit the annulment grounds set forth in Section 24(b) of the IAA and Article 34(2)(a), but not to the annulment grounds in section 24(a) and Article 34(2)(b); and
  • Empowering the High Court to order costs of the arbitration following a successful application under section 24 of the IAA or article 34(2) of the Model Law to set aside an award, whether wholly or in part.

The consultation period commenced on 26 June 2019 and will run up to 21 August 2019. All feedback must be submitted to MinLaw by 21 August 2019, either by post or email.

Comments

Unlike the mechanism for appeals under the Arbitration Act, where parties may exclude the right to appeal by agreement, the right of appeal contemplated under the draft IAA Bill requires parties to make a deliberate choice for the High Court to supervise the arbitral proceedings with regards to matters of law.

This approach resonates with MinLaw’s focus on providing parties with a greater suite of options to tailor an international agreement to suit their unique purposes.

This could be a satisfactory compromise between parties who may prefer court supervision on matters of law in arbitral proceedings, and parties who prefer to not have appeals on arbitral awards in the interests of having finality in the arbitral process.

Companies in industries which tend to resolve disputes through arbitration should take this opportunity to consider if they would be inclined to opt-in to this right to appeal mechanism in the event that these contemplated changes are eventually enacted.

For further enquiries or discussions, please feel free to contact our team below.

Authors

Edgar Chin, Jonathan Thio

 

 

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