Amendments to Modernize and Streamline Singapore’s International Arbitration Laws

On October 5, 2020, Singapore’s Parliament passed the International Arbitration (Amendment) Bill (the “Bill”) to amend Singapore’s International Arbitration Act (Cap. 143A) (the “Act”). The amendments strengthen Singapore’s legal framework for international arbitration, thereby enhancing its status as an international disputes hub and preferred seat of arbitration. 

The Bill, which was tabled on September 1, 2020, formally adopts two of the four proposals on which the Singapore Ministry of Law (the “Ministry”) sought public feedback from June to August 2019:

• a default mode of appointing arbitrators in multiparty situations, where the underlying arbitration agreement does not specify a procedure to do so (a new s. 9B in the Act); and
• explicit recognition of both tribunals’ and the Singapore High Court’s powers to enforce confidentiality obligations by giving directions or making orders (a new s. 12(1)(j) and revised s. 12A(2) in the Act).

The remaining two proposals, which remain under study by the Ministry, are briefly set out below.

After the Presidential Council for Minority Rights scrutinizes the Bill and once it receives the President’s assent, it will come into operation on a date that the Minister of Law appoints by notification in the Gazette.

Default mode of appointing arbitrators in multiparty situations

The new law introduces a default mode for appointing arbitrators in multiparty proceedings where the underlying agreement does not specify a procedure to do so. It sets out clear processes and timeframes that the parties should adopt in appointing a three-member tribunal. In essence, all claimants and all respondents must, respectively, agree to appoint an arbitrator within a specified timeframe. The two party-appointed arbitrators will then appoint a presiding arbitrator. If they are unable to land upon an agreement, the “appointing authority” (i.e., the President of the Court of Arbitration of the Singapore International Arbitration Center (SIAC) or such person appointed by the Chief Justice to exercise these powers)¹ shall, upon the request of either party, do so instead. 

Difficulties may arise in applying this where, for instance, there is ambiguity in classifying parties as either claimants and respondents, such as where multiple counterclaims and cross-claims are involved. The default mechanism resolves this by providing that in the event a party-appointed arbitrator is not selected within the specified timeframe, the “appointing authority” must, upon the request of any party, appoint all three arbitrators and designate any one of the arbitrators as the presiding arbitrator.

Prior to this, the Act, which last underwent substantive amendments in 2012, addressed only the process for appointments in two-party disputes (i.e., one claimant and one respondent). This amendment is timely, as multiparty arbitrations are becoming increasingly common, particularly in respect of joint venture, oil and gas exploration, and merger and acquisition disputes.² As such proceedings can be complex in nature, this default mechanism circumvents the possibility of these becoming stalled or delayed in the event that parties are unable to agree on the appointment of the arbitration tribunal.

As this default mechanism largely mirrors those set out in the SIAC, new International Chamber of Commerce (ICC), and Hong Kong International Arbitration Center (HKIAC) rules in respect of multiparty appointments,³ it is likely to be most relevant to ad hoc arbitrations or where institutional rules without such mechanisms are chosen to administer the arbitration.

Arbitral tribunals’ and the Singapore High Court’s power to enforce confidentiality obligations

Under Singapore law, the parties and the arbitral tribunal have an implied duty not to disclose confidential information obtained in the course of arbitral proceedings or to use such information for any purpose other than the dispute unless the parties agree otherwise. The parties may also undertake express confidentiality obligations in either their arbitration agreements or by virtue of the institutional arbitration rules they have selected. Certain rules, such as the SIAC and HKIAC rules,⁴ spell out such obligations.

While the Bill does not independently create or codify any such obligations, it strengthens parties’ ability to enforce existing confidentiality obligations, by officially recognizing that arbitral tribunals and the Singapore judiciary have the power to “make orders or give directions” to ensure that such obligations are fulfilled. This is akin to the enforcement powers that the ICC rules grant to arbitral tribunals.⁵ This recognizes the importance of confidentiality to arbitration. Interim orders by both Singapore-seated and foreign tribunals can now be enforced in the same manner as court orders, provided that leave of the High Court is obtained. If the tribunal has yet to be constituted, the High Court can make orders to enforce these obligations directly.

Remaining two proposals under study by the Singapore Ministry of Law:

Two other proposals put forward for public consultation remain under review by the Singapore Ministry of Law. These proposals contemplate: