The Singapore Court of Appeal has clarified the standard of review that applies to winding-up applications where the underlying relationship between the debtor and creditor is subject to an arbitration agreement.  

The Singapore Ministry of Law will introduce the COVID-19 (Temporary Measures) Bill (the Bill) in Parliament next week to address the impact of COVID-19 on businesses and individuals' ability to fulfil their contractual obligations. The Bill will also make some temporary changes relating to bankruptcy and insolvency.

The Bill will apply to various categories of contracts, including:

The Singapore Ministry of Law has published for public consultation amendments to the Singapore Companies Act (Cap 50). The amendments, if enacted, have the potential to radically overhaul the existing insolvency and restructuring regime in Singapore. The clear aim of the amendments is to transform Singapore into a hub for cross-border and transnational insolvencies and restructurings.

This update briefly summarises the key amendments which have been proposed and the background to those reforms.

Key Points

Trademark licensees that file for bankruptcy protection face uncertainty concerning their ability to continue using trademarks that are crucial to their businesses. Some of this stems from an unsettled issue in the courts as to whether a licensee can assume a trademark license without the licensor’s consent. In In re Trump Entertainment Resorts, Inc., 2015 BL 44152 (Bankr. D. Del. Feb. 20, 2015), a Delaware bankruptcy court reaffirmed that the ongoing controversy surrounding the “actual” versus “hypothetical” test for assumption of a trademark license has not abated.

A debtor's decision to assume or reject an executory contract is typically given deferential treatment by bankruptcy courts under a "business judgment" standard. Certain types of nondebtor parties to such contracts, however, have been afforded special protections. For example, in 1988, Congress added section 365(n) to the Bankruptcy Code, granting some intellectual property licensees the right to continued use of licensed property, notwithstanding a debtor's rejection of the underlying license agreement.