Update on Seizure of Singapore's Terrex Infantry Carrier Vehicles in Hong Kong

Thank you very much. Mdm Speaker, the Ministry of Defence (MINDEF) and the Chief of Army have already disclosed the procedures used by the Singapore Armed Forces (SAF) for shipping military platforms for overseas training. Let me summarise.

Singapore has limited training areas. Each year, SAF moves over 700 military platforms using commercial carriers to all parts of the world in Asia, Australia, Europe and the United States (US). The SAF's contracts with these shipping companies and agents require them to comply with established protocols and all relevant international and local port rules. But the contracts leave it to the shipping companies to designate routes and ports, because this is their core business. Neither the SAF, Singapore, nor indeed most other countries, operate on the assumption that our cargo will be arbitrarily seized when transiting reputable foreign ports. SAF has followed these procedures for shipping military equipment for over 30 years without any significant incidents.

These commercial arrangements have enabled SAF to ship military equipment safely and economically. It would cost three to four times more and add several hundred million dollars to MINDEF's annual budget to ship all military equipment directly from point-to-point. Neither does the Republic of Singapore Navy (RSN) have transport ships with that scale and capability to ship all this equipment. However, our Landing Ship Tanks (LSTs), currently our largest multi-purpose and transport ships, are due for replacement. We will consider if we need to replace them with ships of larger capacity.

There are some exceptions, albeit rare, when SAF does not use commercial shipping companies, or will apply special considerations if we do, based on security risk assessments. For example, as we did previously, when we shipped advanced weapon and sensor systems or submarines back to Singapore previously, the special measures include chartering whole ships, mandating direct shipments, deploying protection forces or even converting the commercial ship to a State Marine Ensign.

The Terrex troop carrier vehicles did not fall into this special category. Members have asked if military secrets have been compromised due to the detention of the Terrexes. As MINDEF has stated, the detained Terrexes and other equipment were being used for training and do not contain any sensitive equipment.

Arising from this incident, SAF has reviewed its shipping procedures comprehensively to reduce the risk of SAF equipment being taken hostage en route. Where we think the risk of detention of SAF assets has gone up, whether in Asia or any other part of the world, we will impose extra precautions even if this means incurring higher freight charges. Alternatively, SAF may consider housing that equipment at overseas training sites to avoid shipping them altogether, and procure additional units to meet operational requirements, where necessary.

In the present case, the SAF Terrexes were transiting in Hong Kong, one of the world's busiest and most established transhipment points. They were in transit on board the ship when they were ordered to be off-loaded by the Hong Kong authorities and detained. The legal position is that the SAF Terrexes and other equipment detained in Hong Kong are the property of the Singapore Government. They are protected by sovereign immunity, even though they were being shipped by commercial carriers. This means that they are immune from any measures of constraint abroad. They cannot legally be detained or confiscated by other countries. This principle is well-established under international law, and we are advised by lawyers that it is also the law in the Hong Kong Special Administrative Region (SAR).

Accordingly, the Singapore Government has asserted our sovereign rights over the SAF Terrexes. We have informed the Hong Kong Government on several occasions over the last two months, both through lawyers and our Consul-General in Hong Kong, that the detained Terrexes and other equipment belong to the Government of Singapore and are, therefore, immune from any measures of constraint. Accordingly, we have requested the Hong Kong authorities to return our property immediately.

Prime Minister Lee has also written to Chief Executive CY Leung of Hong Kong on this matter to reiterate the same message. The Hong Kong authorities have responded that the investigation is ongoing and will take some time to complete and that the Hong Kong government will handle the matter in accordance with their laws.

Singapore welcomes this response. Adherence to the rule of law has been the fundamental basis for peace and stability in the last half century in Asia. It has enabled countries both large and small to build trust and confidence in one another, cooperate and prosper together. These are the very principles incorporated in the Treaty of Amity and Co-operation whose signatories pledge "to promote regional peace and stability through abiding respect for justice and the rule of law".

Whether APL, the shipping company in this case, has complied with the rules of Hong Kong port is a matter between APL and the Hong Kong authorities, which should follow the due process of Hong Kong law. That issue between APL and Hong Kong Customs affects neither the legal position of the Terrexes nor the Singapore Government's rights. We, therefore, look forward to the Hong Kong government returning our Terrexes in accordance with international law.

Singapore and Hong Kong have long enjoyed good and friendly relations. We hope the matter will be resolved satisfactorily and our friendly relations will endure.

I thank the Minister and I am glad to know that there are no military secrets compromised. Is Singapore also considering commercial claims against the carrier, in the event of any delay or losses that may arise if the Terrexes are not returned or if there are some other delays in the return?

Madam, we have been advised by our lawyers that there are legal avenues available to MINDEF to claim for damages against shipping carriers and contractors if they have not fulfilled their contractual obligation. So, the answer is yes. In addition, all SAF cargo we ship is insured against losses under some conditions. We have to check if the insurance claims are applicable for this particular incident.

Madam, I noted in the Minister of Defence's reply that SAF would avoid, in the future, our military equipment being taken hostage. I would like to ask some supplementary questions. Firstly, whether or not MINDEF anticipated that such hostage situation could have happened. Secondly, I would like to ask whether or not Hong Kong or China has imposed any conditions for the return of the Terrex vehicles. Thirdly, what would be the loss of potential future earnings for Singapore in this piece of defence technology which even the US is interested in?

Let me thank Mr Low for his questions. Not only in the future of losing our equipment, but that has been our prevailing policy. That is why we have, as I said, for that special category, imposed special conditions on ourselves and our commercial shippers and whether it is in the form of port-to-port or converting commercial ships to State Marine Ensign when we brought back our submarines.

But in this particular instance, the Terrexes do not fall into that special category, and we leave it to the carriers to designate the ports. Hong Kong is an international port of repute, and there is no reason to believe that our SAF assets will be seized. Have there been conditions? I have related to Members what the Hong Kong government had responded with. That is, at complete face value, what has happened. They have said that they need time and that they will handle it in accordance with Hong Kong's laws, and we welcome that assurance.

The third question on the cost of the nine Terrexes, it is as listed in the shipping manifest at S$30 million.

Mdm Speaker, there was another question on loss of earnings from this incident. It is a theoretical question. I find that hard to assess. ST Kinetics or ST Engineering will have to do its work. But whether this increases the notoriety of the platform and, therefore, increases its selling potential or not, who is to say? It is theoretical and I want to defer from answering that question.

I would like to thank the Minister for Defence for his clarifications. There are two questions. One, does MINDEF consider the details of the Terrexes' armour or any other technical specifications to be classified information?

Second, does the confiscated shipment include any equipment or technology that falls under some export control regime or restrictions to China?

Let me answer the second part first: no, it does not contain any of that sensitive equipment. The easiest way to answer Mr Singh's question is that you can purchase the Terrexes and associated equipment on the open market. So, they do not contain any sensitive equipment.

As the Minister has mentioned, the detention of our Terrexes appears to be contrary to Hong Kong and international law. I would like to enquire: in dealing with the Hong Kong authorities, has MINDEF found the experience to be largely rules-based and process-based? It could be a helpful barometer for how businesses assess Hong Kong's reputation as an international port.

We have communicated to the Hong Kong government on a number of occasions, as I have said, at various levels, including the Prime Minister's letter, and I have read to Members their response.

There was one previous case where there were some similarities, and this was a case where the South Korean's equipment was also seized by the Hong Kong authorities. This was in 2010, and it was also an armed personnel carrier, as well as a light tank; and it was returned subsequently to the South Koreans.

I thank the Minister for the answer so far. I would like to ask the Minister whether the Hong Kong customs authorities had actually openly stated what was the problem with the import declaration or customs declaration, because I have not quite really seen it in the media so far.

The Hong Kong government has responded on the various occasions that we had asserted our sovereign immunity as well as asked for updates that their investigations are ongoing. As I had said in my reply, they have said that they will settle this in accordance with Hong Kong law.