Proposal to Review International Arbitration Act to Allow for Appeal through Singapore Courts

26 Mr Murali Pillai asked the Minister for Law whether the Ministry will consider reviewing the International Arbitration Act to provide for an avenue of appeal to our Singapore courts where it is alleged that there are errors of law in the award issued by an arbitral tribunal.

Mr K Shanmugam: Arbitration is a popular means of resolving commercial disputes. One of the reasons for its popularity is that it allows parties to have the autonomy to choose how their dispute should be resolved. This includes options like where the dispute should be heard and who should hear the dispute.

Singapore has over the years become a popular seat of international commercial arbitration. According to the White & Case and Queen Mary University of London's International Arbitration Survey in 2018, Singapore and the Singapore International Arbitration Centre (SIAC) were ranked as the third most preferred arbitration seat and arbitral institution in the world respectively, and first in Asia. The SIAC announced in its 2018 Annual Report that it has, for the second year running, received over 400 cases from parties in 65 jurisdictions. The total sum in dispute for all new case filings in 2018 was USD 7.06 billion (SGD 9.65 billion), an increase as compared with 2017.¹

The Ministry keeps track of developments in international best practices, to ensure that our framework stays responsive to users' evolving needs. Significant changes to the International Arbitration Act over the years include broadening the definition of an arbitration agreement and providing recourse against negative jurisdictional rulings by an arbitral tribunal. These changes reflect Singapore's commitment to support international commercial arbitration by enhancing the suite of options available for users, strengthening Singapore's position as the preferred destination for premier legal services.

As part of my Ministry's efforts to update the legal framework, my Ministry has noted that in certain other jurisdictions, parties to an arbitration may appeal against an award on a question of law. Currently, under our International Arbitration Act, parties who wish to challenge an arbitral award may apply to the High Court to set aside a final award. However, they may only do so on limited grounds relating to issues of jurisdiction, procedural irregularity, fraud, corruption or public policy. These grounds are as set out in Article 34(2) of the UNCITRAL Model Law on International Commercial Arbitration and section 24 of the International Arbitration Act. There is no avenue for parties who wish to appeal to our Courts on a point of law in the award in international arbitrations.

My Ministry is currently reviewing the International Arbitration Act, taking into account the experience of other jurisdictions. One of the amendments we are considering will allow parties to appeal to the courts on a question of law arising out of an arbitration award, provided that they have agreed to contract in or opt in to this mechanism. Such appeals could be heard in the High Court, with safeguards to prevent frivolous or vexatious appeals.

Proponents of this option have said that it enhances party autonomy and injects greater flexibility for parties to opt for an appeal process to the courts if they wish to do so, while preserving certainty and finality.

My Ministry intends to conduct a public consultation on this, and other enhancements to the International Arbitration Act, and will release further details in due course.