Singapore’s new chapter in the story of transnational commercial justice: Opinion

The global order is shifting from a unipolar world to a multipolar one, and with this shift, cross-border flows of trade and investment are changing. International commercial courts play an important role in facilitating transnational business dealings, especially when they cross geopolitical fault lines. People who do business need to trust each other – or if they don’t, then they must at least have ready recourse to an effective mechanism to resolve any disputes that arise between them.

Over the past quarter-century, Singapore has transformed into one of the world’s pre-eminent dispute resolution hubs for cross-border business, including in cases where the underlying dispute has no connection to the Republic.

This transformation of the legal sector has been underpinned by the work of our courts, and buttressed by strong support from the government. Just before the turn of the millennium, then-chief justice Yong Pung How urged judges to be “relevant and of service to 21st-century society” by becoming “long-term planners and strategists”, and ensuring that the law keeps pace with advancing technology.

His successor, Chan Sek Keong, supported both the development of Singapore commercial law and its promotion as a governing law for cross-border transactions. In the past decade under the leadership of Chief Justice Sundaresh Menon, the pace of change in Singapore’s legal sector has quickened.

Next year marks the 10th anniversary of the establishment of the Singapore International Commercial Court (SICC). It will also witness the launch of the International Committee of the SICC, which will hear prescribed civil appeals from international commercial courts situated outside of Singapore.

This arises initially from the Republic’s collaboration with Bahrain in relation to its new international commercial court, the Bahrain International Commercial Court (BICC). Appeals will lie from the BICC to the International Committee of the SICC pursuant to a treaty between Bahrain and Singapore that was inked in March this year.

The growth and development of the SICC in meeting the justice needs of international and cross-border businesses benefit Singapore and contribute to our dynamic legal industry.

The SICC is part of the Singapore High Court, which is a part of the Supreme Court. Its jurisdiction is limited to international commercial disputes, proceedings in relation to international arbitrations seated in Singapore, and cross-border corporate insolvencies.

Civil and common law jurisdictions

In a typical case before the SICC, the matter will be heard by a mixed coram, comprising a Singapore commercial judge and international judges drawn from both civil and common law jurisdictions. These labels refer to the two broad systems of law that have come to influence almost every national legal system.

The common law emerged in England from the 12th century onwards, as the body of law developed by judges hearing cases that came before the courts. Singapore – like many other former colonies of the British Empire, including India and the US – adopted the common law.

Civil law has its origins in Roman law as codified in late antiquity by the Byzantine emperor Justinian. Continental European countries such as France and Germany adopted civil law codes. It spread to countries in Asia such as Indonesia and Vietnam through colonisation, but was also adopted by countries such as China, Japan and Thailand that resisted colonisation.

The international bench of the SICC includes common law judges from jurisdictions such as Australia, England, India and the US, as well as civil law judges from jurisdictions including China, France, Germany and Japan.

Singapore is at the forefront of a new wave of convergence and harmonisation in the field of commercial law. In this endeavour, it is essential to draw upon both civil and common law. The SICC demonstrates three approaches for cross-fertilising these two traditions.

Three approaches

First, the SICC offers alternative tracks that parties can choose for the management of their proceedings. The memorials track corresponds with civil law procedure, while the pleadings track corresponds with common law procedure.

Secondly, there has been development of what may be described as hybrids of civil and common law approaches. One example is combining active early judge-led case management (which is a hallmark of civil law systems) and oral evidence-testing or cross-examination (a key feature of common law systems in relation to fact-finding).

Thirdly, the SICC in suitable matters can hear directly from counsel qualified in the laws of different jurisdictions. In one case involving an Indian company and a Chinese company that concerned a transaction completely unconnected to Singapore, the SICC heard both from Singapore counsel and from two other sets of counsel, each qualified in different national laws.

In a multipolar world, sources of transnational commercial law such as the United Nations Commission on International Trade Law (UNCITRAL) and the Hague Conference on Private International Law become ever more important.

UNCITRAL’s production of Model Laws, which states may adopt into national legislation such as the 1985 Model Law on International Commercial Arbitration and 1997 Model Law on Cross-Border Insolvency, has extended to emerging areas such as electronic commerce, electronic signatures, and electronic transferable records.

When the Singapore Convention on Mediation was launched in 2018, UNCITRAL produced a Model Law on International Commercial Mediation and International Settlement Agreements Resulting from Mediation.

The Hague Conference has produced conventions on matters relevant to cross-border commerce and dispute resolution such as choice of court, choice of law and judgments.

This growing body of transnational commercial law backstops the work of the SICC, especially in relation to its jurisdiction over international arbitrations and cross-border insolvency.

I close by returning to the new chapter we are writing in the story of transnational commercial justice. This chapter involves linking international commercial courts in different parts of the world, such as the avenue for appeal from the BICC to the International Committee of the SICC.

This development adds weight to the anchoring role that such international courts play in relation to non-court-based modes of dispute resolution such as arbitration and mediation. It has the potential to further strengthen the role that international commercial courts play in upholding the international rules-based order, even as that order comes under pressure from global fragmentation.

Moreover, it facilitates convergence and harmonisation among national commercial laws, even across civil and common law jurisdictions. Without doubt, it offers extraordinary opportunities to our legal sector to take on a leading global role.

The writer is judge of the High Court, Supreme Court of Singapore, and president of the Singapore International Commercial Court

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