The COVID-19 (Temporary Measures) Act (the Act) will have a considerable impact on the enforcement of certain contracts and commercial disputes in Singapore for the next 6 to 12 months. The Act was passed by the Singapore Parliament, and commenced on the same day, 7 April 2020.
The key measures of the Act are:
The Singapore High Court recently issued the first-ever super-priority order for debts arising from rescue financing under Section 211E(1)(b) of the amended insolvency laws in the Companies Act. The decision shows that the court is open to adopting relatively unique deal structures, and could be a benefit for more business-centric solutions.
A Singaporean construction company in liquidation has successfully sued one of its former directors for failing to act in the best interests of the company, highlighting the importance of directors being aware of, and protecting against, potential personal liability for breach of duty.
Directors’ liability – the risk
Investment funds in Singapore are typically constituted as companies, unit trusts or limited partnerships. This is set to change with the advent of a new fund vehicle, the Variable Capital Company ("VCC"). The VCC is now an alternative, after the commencement of the Variable Capital Companies Act 2018 ("VCC Act") on 14 January 2020. This update focuses on the considerations a financier may wish to take note of when financing a VCC.
What is a VCC?
The Ministry of Law in Singapore has announced that it will introduce a bill to the Parliament next week to offer temporary relief to businesses and individuals who are unable to fulfil their contractual obligations because of the COVID- 19 pandemic.
The proposed bill includes:
On 1 October 2018, the Singapore Parliament passed the Insolvency, Restructuring and Dissolution Bill (the "Bill"), an omnibus legislation which will consolidate Singapore's personal insolvency, corporate insolvency and restructuring laws, which are currently under separate legislative regimes.
The overhaul follows recent amendments to the corporate insolvency and restructuring provisions of the Singapore Companies Act, and is part of a wider effort to boost the debt restructuring ecosystem in Singapore.
Key provisions introduced by the bill
Dispute Resolution
Singapore
Newsletter
December 2018
In This Issue:
Key Legal Developments
1. Arbitration 2. Construction
3. Commercial Litigation
4. Restructuring & Insolvency
5. Reforms to Singapore's civil justice system
Upcoming Events
Key Resources
For more information, please contact:
Nandakumar Ponniya Principal +65 6434 2663 nandakumar.ponniya @bakermckenzie.com
Celeste Ang Principal +65 6434 2525 celeste.ang @bakermckenzie.com
In a noteworthy decision to participants in the energy industry, the High Court of England & Wales examined what constitutes a valid liquidated damages clause in the event of delayed completion of a solar project. And last week in Singapore, the High Court considered the enforceability of liquidated damages provisions on termination of power purchase agreements.
Singapore’s new restrictions on ipso facto clauses are welcome news to the local restructuring community, and a strong step towards establishing it as one of the region’s premier restructuring hubs. But how will these restrictions affect innocent counterparties and existing commercial contracts, ask partner Guan Feng Chen and associate Jonathan Tang at Morgan Lewis Stamford?
New restrictions on ipso facto clauses
SINGAPORE INSOLVENCY, RESTRUCTURING AND DISSOLUTION BILL PASSED
On 1 October 2018, The Insolvency, Restructuring and Dissolution Bill was passed in Singapore.
This will consolidate personal and corporate insolvency laws into the Insolvency, Restructuring and Dissolution Act, with the Bankruptcy Act to be repealed and the relevant corporate insolvency provisions in the Companies Act being removed.