S’pore to see increase in international arbitration work
Plans to open up sector to lure more foreign participation
By MICHELLE QUAH
(SINGAPORE) The level of international arbitration work in Singapore is set to burgeon - with latest measures to liberalise the legal industry here only serving as further impetus.
Legal practitioners are predicting that proposals announced by the government last year to deregulate the profession - in particular, those to open the industry to greater foreign participation - will significantly boost international arbitration work.
One key recommendation is to introduce a new Qualifying Foreign Law Firm scheme - under which, up to five foreign law firms will be allowed to practise Singapore law. The move will not just boost the business of foreign law firms, but the legal industry as a whole.
Drew & Napier, the first Singapore law firm to be named by Asia Legal Business as the International Arbitration Firm of the Year, sees the breadth and depth of disputes heard in Singapore increasing - signalling a growing maturity of alternative dispute resolution.
‘We have seen a significant shift in the nature of arbitrations in the last five years alone. The dispute values have risen very substantially,’ observes Drew & Napier Senior Counsel Harpreet Singh Nehal.
‘We have seen a significant shift in the nature of arbitrations in the last five years alone. The dispute values have risen very substantially.’
- Drew & Napier Senior Counsel Harpreet Singh Nehal
‘In addition, the choice of law for many of our arbitrations is no longer Singaporean law, but increasingly laws of foreign jurisdictions. This is a testimony to our country’s neutrality and high standard of the rule of law, as well as its attractiveness as a place to conduct business, even contentious business,’ he adds.
The Singapore International Arbitration Centre (SIAC) - set up in 1991 to meet the demands of the international business community for a neutral, efficient and reliable dispute resolution institution in Asia - also notes the level of international arbitration work here increasing.
The number of international cases administered by the SIAC has doubled in the last few years - from 35 in 2003, to 70 in 2007.
‘And we expect to see a further increase, going forward, with the initiatives the government has put in place,’ says SIAC Registrar, Sabiha Shiraz.
She notes that parties from China, Indonesia and India have been, and continue to be, the biggest users of SIAC’s international arbitration services.
Foreign law firms here are also bullish.
White & Case LLP Singapore partner, Bertie Mehigan, notes: ‘My personal view is that there will be more arbitration work in Singapore in the coming years. The economic growth of China, India and other Asian countries; the fact that there are very large projects and transactions across Asia involving domestic and international participants and that the legal systems and dispute resolution mechanisms in many of these growing economies lag behind Singapore will be the factors that present the opportunities to Singapore.’
And DLA Piper’s regional managing partner, Desmond Ong, says: ‘From personal experience, there are an increasing number of international arbitrations being conducted here.’
SIAC believes that cases likely to benefit from these increased opportunities will mainly be in the construction, large infrastructure projects, oil and gas sectors. The importance of Singapore as a hub for Asia has seen White & Case appointing three new partners, Chen Guan Feng, Brad Roach and Thong Huey Yann, to its Singapore office - to build on the firm’s capabilities in bank finance and restructuring, and energy and project finance sectors.
Drew & Napier also sees IT arbitrations - involving enterprise-wide software contracts - as a growth area. Senior Counsel Cavinder Bull notes: ‘Singapore has always been a preferred destination for multinationals to set up a regional office for Asia. And one aspect of having a regional office here also involves setting up a regional IT operation in Singapore. Inevitably with large software contracts, disputes will arise over areas like programming, source codes, delivery, implementation and so on.’
‘There is a lot of nitty-gritty and minutiae involving source code issues that can be quite esoteric. These matters can be broken up and examined thoroughly, often taking weeks. So arbitration is well-suited both for technical reasons and for its ability to accommodate lengthy proceedings,’ Mr Bull adds.
Intellectual property - and cases involving bilateral and multilateral investment treaties are other specialised areas where cross-border disputes are increasingly being arbitrated in Singapore.
‘We are also getting involved in more disputes involving the energy industry. With oil and coal prices escalating rapidly, suppliers are breaching supply contracts as they are no longer willing to deliver based on the earlier, much lower price stipulated in the agreement,’ adds Mr Bull.
SIAC’s Ms Sabiha concludes: ‘The increasing level of international arbitration work here will serve to benefit the legal services industry as a whole - and it will be something practitioners will look forward to.’
Source : Business Time - 25 Feb 2008
Singapore Property - Buy , Sell , Rent , Invest
Mindy Yong
(+65)91002985
mindy@mindyyong.com
Microsoft launches BizSpark to boost technology start-ups »« Singapore’s biggest employer still hiring
