Reciprocal Enforcement of Foreign Judgments (Amendment) Bill

Mr Deputy Speaker, Sir, I would like to declare my interest as a lawyer in private practice. These two Bills are presented after public consultation. The move on the part of MinLaw to consult before introducing these two Bills is to be commended.

The stated aims of these Bills are to streamline the statutory regimes for the recognition and enforcement of foreign judgments into one under the REFJA and to take the necessary steps to ensure the recognition of Singapore's civil judgments overseas on the basis of the reciprocity principle between countries.

I welcome and support these aims. As mentioned by the hon Senior Minister of State, Singapore is already a well-recognised dispute resolution hub, with the SIAC, SICC and SIMC.

In the context of the litigation in courts, the set up of SICC was a game-changer. The SICC, a division of the High Court, consist of top international jurists, in addition to the Singapore Supreme Court judges, who all have deep expertise, skill and experience to try complex international commercial disputes.

Singapore's ratification of the Convention on Choice of Court Agreements, a point that the hon Member, Mr Christopher de Souza mentioned, allows judgments issued by the Singapore Court pursuant to exclusive choice of court agreements to be recognised by signatory countries. This was a big step in achieving the policy aim of ensuring the wide recognition of Singapore judgments.

It is proposed under the REFJA (Amendment) Bill that the statutory base for recognition of a foreign judgment be enlarged. The effect of this is to allow a Singapore judgment to be similarly recognised by competent authorities in foreign jurisdictions through the reciprocity principle.

Subject to the comments that I will shortly make, I support the enlargement of the statutory base.

Before I deal with my comments on the Bills, I would like to make some suggestions on steps that can be considered to increase the attraction of Singapore's courts judgments and Singapore as a dispute resolution hub.

I had previously suggested in this House that Singapore consider the viability of entering into the Apostille Convention which deals with certification of a document's validity for legal purposes in signatory states. There are currently 117 countries which are parties to this Convention.

This would significantly cut down the costs and labour involved in legalisation of documents. I understand that the Ministry of Law is looking into this matter and would appreciate an update.

In the same vein, I would suggest that the Government consider the viability of Singapore signing the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil and Commercial Matters, in other words, the Hague Service Convention which currently has 75 countries as contracting parties.

This will enable easier service of process commencing legal action on parties situated in Convention countries. Otherwise, it may take an inordinate amount of time through the usual consular routes to serve process. And this may take between three to five years, depending on the countries involved.

Returning to the Bills, I would like to ask about the scope of recognition and enforcement of an interim and non-money judgment under the proposed amendments to the REFJA.

I note from the hon Senior Minister of State's speech that injunctions are considered. Also, orders for specific performance. May I ask, how many search orders? How about declarations?

Specifically, in the context of interim injunctions, I am heartened to note that the Bill does allow for recognition of interim freezing orders, targeting assets of a defendant in Singapore issued by a foreign court so as not to make a subsequent final judgment of the foreign court nugatory.

This is to be welcomed because previously, in my view, there was a "black hole" which a defendant can exploit because the individual may be situated in one country and have assets in another country.

The current legal position in Singapore is that the local courts may not necessarily grant an injunctive relief purely in aid of a foreign proceedings.

In an interconnected world, this makes less sense and certainly, it is not the case in respect of arbitration proceedings. Under the International Arbitration Act, the Singapore court may issue interim relief in respect of arbitration proceedings overseas. So, with this amendment, we can potentially resolve this anomaly.

And through the principle of reciprocity, I hope that the Singapore interim judgments will similarly be recognised overseas so as not to render a subsequent final judgment of the Singapore courts nugatory.

I now turn to civil forfeiture action taken by sovereign governments. There are certain jurisdictions which assert wide jurisdiction over assets wherever it may be situated. For example, we have the unexplained Wealth Orders issued by the UK courts aimed at assets overseas. These proceedings are civil in nature.

But if you look at it carefully, in reality, these Orders may be viewed as penal in nature and may not be too different from a tax judgment or a fine or other penalty which is not covered under the REFJA.

And this may also be seen as a sidestep from what would otherwise be subject matter of an mutual legal assistance treaty (MLAT) request between countries.

There could also be issues vis-a-vis bona fide third parties who may have to deal with assets that are ordered to be forfeited by a foreign court.

May I ask how the proposed amendments would deal with foreign civil forfeiture orders?

In this regard, it may be useful to consider how other jurisdictions deal with such orders. For example, in New Jersey, there is a separate piece of legislation dealing with civil asset recovery orders made by foreign courts. It does not confer automatic recognition of such orders. It will involve the Attorney-General who makes a decision in his discretion whether or not to make an application to freeze and confiscate the assets which are subject matter of the foreign civil asset recovery order.

Finally, I welcome the safeguard that is sought to be introduced in form of the proposed section 4(3A) of the REFJA under which the court may only register a non-money judgment if it is satisfied that the enforcement of the judgment would be just and convenient.

I seek an elaboration on the factors the Court is supposed to consider before deciding it is just and convenient to recognise a foreign non-monetary judgment, or if it is not, what are the circumstances in which the judge would then decide to convert it into a money judgment.

Notwithstanding my comments, I support the Bills.

Thank you, Mr Deputy Speaker. I thank the Members for supporting the Bill. I will just address the clarifications directly.

Mr de Souza asked about section 7(1) of the REFJA. Section 7(1) states that a foreign judgment to which the REFJA applies, may only be enforceable by way of registration under the REFJA. The rationale for having and retaining this provision is to preclude judgment creditors from seeking to enforce such foreign judgments, which are contemplated and covered by the REFJA, under the common law route. So, if you have a judgment that fits within REFJA's framework, then do it by way of registration and not take up Court time and seek to deploy the common law recognition.

As for foreign judgments that may be recognised and enforced under the Choice of Court Agreement, these will continue to be excluded from the reformed REFJA under section 2A of the REFJA.

The Choice of Court Agreements Act and the reformed REFJA are mutually exclusive enforcement regimes, with the Choice of Court Agreements taking precedence if it is applicable. So, if the parties have chosen by agreement a Court, the convention applies, and you use the Choice of Court Agreements Act to recognise those judgments.

Mr de Souza also asked about plans to negotiate new reciprocal arrangements. I think Mr Dennis Tan also asked several questions in this regard.

The purpose behind the amendments is to first level up in terms of the options that we have, the availability of non-money judgments, for example, to be recognised. Based on this, what will happen is we have to look at the regimes in other countries. Having regard to what Singapore's business interest would be, what serves Singapore lawyers, Singapore business community and our interest, as a whole, best in looking out for the countries that we might want to have an arrangement with, that will be the driving consideration when we look at how we negotiate and with whom we negotiate these reciprocal arrangements.

We will study their systems and we will look at them in the context of whether their system is also something that fits with what we regard as a proper legal system, and also look at the nature and type of remedies and, therefore, judgments that they have, and the grounds and principles on which they arrive at those judgments.

Ultimately, we have to remember that we have to serve the public interest in Singapore, what I mentioned earlier, and those will be the principle considerations as we do so. So whether, as Mr Tan says it is with ASEAN or with any other country in the world on this, those will be the considerations that we will have.

In terms of Mr Murali Pillai's questions on the scope of recognition and the enforcement, I think there were two questions on this. The first is what kinds of interim and non-money judgments are contemplated to be recognised. I outlined earlier the types that are considered, so freezing orders, Mareva injunctions and so on, to preserve, on the interim basis, sometimes it is also a final injunction – the parties' assets. Injunctions requiring a party to do something, which is a mandatory injunction, or to refrain from doing something else. Orders for specific performance could also be considered. Mr Pillai raised this point about declaratory judgments, those can also be recognised. We also contemplate that orders for delivery up or the recovery of property can be recognised.

But one has to also be clear that this only applies to civil judgments. So, if one is looking at delivery up or enforcement on the property, in the context of a regulatory, penal regime or in a criminal matter, then those will not be covered by this Bill.

In that context, Mr Pillai also asked about civil forfeiture actions taken by sovereign governments. The present framework, which is pre-amendment, does not cover confiscation or forfeiture orders by which assets are seized by a foreign government. The reforms that we propose in this Bill do not change that.

Even if some of these foreign proceedings may be classified, as a matter of labelling, as "civil", they are effectively in substance the enforcement of the foreign country's penal, revenue or public criminal laws. Those would not be caught under this Act and would not be enforced in this way.

This is indeed in line with the common law position that Courts will not enforce a foreign judgment if this results in whether a direct or indirect enforcement of that country's penal, revenue or public laws. However, if a regulatory action is taken for the purpose of compensating persons deprived of those funds, the resulting judgment, that means the judgement arising from that claim for compensation, would be enforceable to the extent of its compensatory nature.

As Mr Pillai also pointed out, in Singapore, the enforcement of foreign confiscation orders is dealt with under the Mutual Assistance in Criminal Matters Act (MACMA), which has the necessary safeguards in place for such requests. Under the MACMA, requests for enforcement of foreign confiscation orders have to be made through the appropriate foreign authorities to the Attorney-General, and dealt with in accordance with the Act. So, that has not changed.

Mr Pillai asked what is a "just and convenient" test in the context of the Bill, and also for an elaboration on the factors that a Court might consider before deciding that it is just and convenient to recognise a foreign money judgment.

As I mentioned earlier, we frame the way in which this would work without prescribing the factors to the Court, to leave some room for discretion. The “just and convenient” test has itself been developed judicially in the context of enforcement under the RECJA. The Courts, in that context, have looked at factors such as whether there was a delay and whether the delay had caused any prejudice to the judgment debtor, for instance; whether the judgment creditor could give a reasonable explanation for the delay in applying to register the judgment; whether the judgment creditor had been reasonably diligent in seeking to enforce it; and what is the conduct of the judgment debtor as well, has he been obstructive, and so on. These are factors that are taken into account but those would not be the only factors.

The overarching question and consideration for the Court to determine was, where did the interests of justice lie, having regard to the factual matrix of the case. The Member will be familiar with judicial authorities that espouse those principles and elaborate on them.

In addition, we anticipate that a likely scenario where it would not be just and convenient to recognise a foreign money judgment, would be possibly an injunction which applies only to within the territory of the country of the foreign court. If a judgment practically only applies to that country, then it would not be just and convenient to also enforce it in the context of Singapore.

Another scenario would be the enforcement of the non-money judgment where that scenario could expose a person to the risk of committing an illegality or to an action for breach of a rule of privilege, for example. In other words, there is an unintended but consequential impact in terms of the enforcement. Those might also be circumstances where it is not just and convenient.

There could also be potentially situations where the non-money judgment has got no equivalent in Singapore. It will then, of course, not be just and convenient for the local Court to enforce it, given that such remedy either does not exist or is not recognised in this form from the foreign courts.

So, those are some examples but I hasten to add that the categories are not closed, and we leave the Court some room to decide, whether in the context of the appropriate case and the parties, and the background circumstances of the case, whether it is just and convenient to recognise the foreign court's judgment and enforce it.

Sir, the new framework that is being proposed will enhance and streamline the regime. It focuses it into one recognised format, rather than have to deal with two different statutes. On Mr Tan's point, yes, it is the Bicentennial year but we have never let history get in the way of good efficient governance.

The Bill also provide us with more flexibility and scope to enter into new treaties, and I think the ability to recognise a variety of different non-money judgments and also a broader breadth of types of judgments, will be helpful.

In addition, and I think Mr Pillai raised two other points which he has raised in the past, the Apostille Convention and also the Hague Service Convention, those are valid points. What I can say is that we are not averse to it, we continue to study them closely, and there are several factors which go behind consideration of those conventions. We have been busy with some other convention but when there is an appropriate update on this, we will let the Member know.

Overall, I believe that this Bill strengthens our position as a centre for international dispute resolution by recognising foreign judgments, by allowing litigants and giving them more confidence to litigate in Singapore, knowing that there will be reciprocity in other parts of this world, and particularly in cases where the judgment debtor may well have assets in other parts of the world. So, on that, Mr Deputy Speaker, Sir, I beg to move.

*Question put, and agreed to.*

*Bill accordingly read a Second time and committed to a Committee of the whole House.*

*The House immediately resolved itself into a Committee on the Bill. – [Mr Edwin Tong Chun Fai].*

*Bill considered in Committee; reported without amendment; read a Third time and passed.*