How Singapore’s international arbitration laws will compare with the position post-reform of the English Arbitration Act

Singapore’s international arbitration law historically was aligned to its English equivalent. In 1994, Singapore’s International Arbitration Act (the Singapore International Arbitration Act) was passed to adopt the UNCITRAL Model Law on International Commercial Arbitration (Model Law) (as adopted on 21 June 1985) with a few modifications as set out in the Act. Soon after, the Arbitration Act 1996 was brought into force in England and Wales (the English Arbitration Act). It also adhered to the Model Law position in many ways.

On the 25^th anniversary of the English Arbitration Act in 2021, the Law Commission of England and Wales was tasked to conduct a review of the Act. As we reported here, on 5 September 2023, the Law Commission published its final recommendations for reforms (the Final Report).

Following the English Law Commission's recommendations, English arbitration law will diverge from Singapore’s in the following material respects.

1. Limitations on challenges to tribunals’ awards as to jurisdiction. An English court’s review of an arbitral tribunal’s jurisdictional ruling in an award would be within more limited parameters than a Singapore court’s, which are fully de novo.
2. Express power for summary determination. An arbitral tribunal seated in England and Wales or Northern Ireland would be expressly empowered by law to dispose of arbitral proceedings on a summary basis. Should a Singapore‑seated tribunal wish to exercise that power, it may have to rely on party agreement, for example, through the adoption of arbitral rules that provide for early determination, or arguably on its broad powers to conduct the arbitration in such manner as it considers appropriate.
3. New test for identifying the governing law of the arbitration agreement. Where there is no express choice of law governing the arbitration agreement, the reformed English legislation would point to the law of the seat applying by default. Under Singapore law, there is a three-stage test that generally points instead to the law of the main contract being the proper law of the arbitration agreement.
4. Appeal on points of law. Under English law (which remains untouched by the reforms), parties to an arbitration may appeal the arbitral award on a point of law, unless they opt out of having this right. Under Singapore law, only parties to a domestic arbitration may appeal an award on a point of law. This is not available to parties to an international arbitration.

We elaborate below.

1. Limitations on challenges to tribunals’ awards as to jurisdiction

Following the reforms, challenges to awards on jurisdictional grounds will be subject to limitations in certain circumstances. These challenges will no longer be fully de novo re-hearings of the jurisdictional questions. Pursuant to the reforms, the English courts will not entertain any new grounds of objection or new evidence raised only after the arbitral tribunal already has ruled on its jurisdiction in the award, “unless even with reasonable diligence [the objection or evidence, as the case may be] could not have been put before the tribunal”. Further, evidence will not be re-heard, save in the interests of justice. Examples of situations in which it may be in the interests of justice to re-hear evidence are: where there is no record of the evidence heard before the tribunal; or where the tribunal had refused to admit evidence that one party wished to advance.

The current Singapore position does not have these limitations. Much like the pre-reform English position, both an appeal to the Singapore courts from an arbitral tribunal’s ruling on jurisdiction, as well as an application to set aside an award on the basis of jurisdiction, would be conducted on a de novo basis. This means that the tribunal’s own view of its jurisdiction basically has “no legal or evidential value to the court” (CUG and others v CUH [2022] 5 SLR 22), though its reasoning may still be of some persuasive value. Unlike the new English position, the Singapore courts may entertain new grounds of objections to jurisdiction and new evidence. It also may consider all evidence “unfettered by any principle limiting its fact-finding abilities” (AQZ v ARA [2015] 2 SLR 972).

2. Express power of summary disposal 

Under the reformed English Arbitration Act, an arbitral tribunal would have the power to issue an award on a summary basis. This power could be exercised if the tribunal considers that a party has “no real prospect of succeeding” on its claim (or defence). This allows a tribunal to dispose of a case without a full hearing of the evidence. As the English Law Commission explained, making this procedure available would allow arbitrating parties to avoid unnecessary delay and expense in appropriate cases.

There is no similar provision in the Singapore International Arbitration Act expressly conferring on arbitral tribunals the power to dispose of cases summarily. However, many tribunals already would have this power by virtue of parties’ chosen arbitral rules. Rule 29 of the 2016 Arbitration Rules of the Singapore International Arbitration Centre allows parties to apply to the tribunal for an early dismissal of a claim or defence, on the basis that the claim or defence is manifestly without legal merit or manifestly outside the jurisdiction of the tribunal

Arguably, an express power of summary disposal is unnecessary in circumstances where, subject to parties’ agreement otherwise, arbitral tribunals generally have broad powers to conduct arbitrations in any manner they consider appropriate. The English Law Commission’s rationale for introducing an express power was to reassure arbitrators as to the propriety of ordering a summary disposal and to reduce “due process paranoia”.

3. Greater court powers in support of arbitral proceedings 

a. Proposed reforms to section 44 of the English Arbitration Act

The proposed reforms confirm that the English court has powers to make interim orders against third parties in support of arbitral proceedings. Currently, the court’s powers exercisable in support of arbitral proceedings, which are set out in the English Arbitration Act, section 44, do not expressly contemplate the exercise of these powers against third parties. Section 44(1) states in general terms only that the court has the same powers in relation to arbitral proceedings as it does for civil proceedings in court. These include the power to make orders relating to the taking of the evidence of witnesses, the preservation of evidence, and the granting of an interim injunction, amongst others. Thus, currently, whether the court has power to make these orders against third parties depends on the civil procedure rules relating to the particular order.

The Singapore position is the English pre-reform position. Section 12A(2) (read with section 12) of the Singapore International Arbitration Act allows the Singapore courts to make the same orders for interim injunctions or any interim measures for the purpose of an arbitration as they may make for the purpose of a court action. Thus, whether a party may seek, from a Singapore court, an order for an interim measure in support of an arbitration will continue to depend on the precise order sought and the applicable civil procedure rules of the court.

b. Proposed reforms to the scheme for emergency arbitrators

The Final Report makes two recommendations regarding emergency arbitrators.

First, it recommends allowing an emergency arbitrator whose order has been ignored to issue a peremptory order which, if still ignored, might result in the court ordering compliance. Second, the Final Report recommends allowing the exercise of court powers in support of arbitral proceedings, even without a showing of urgency, pursuant to an application by a party with an emergency arbitrator’s permission. Presently, section 44(4) of the English Arbitration Act allows the court to exercise powers in these circumstances only if a “tribunal” (which does not include emergency arbitrators) has given permission. Thus, in practice, if an emergency arbitrator has been appointed and the case is not one of urgency, the court is powerless to act unless the other parties agree, even if the emergency arbitrator is also unable for the time being to act effectively.

These recommendations bring the English position in line with the prevailing position in Singapore.

The Singapore International Arbitration Act does not specifically address the court’s enforcement of a peremptory order by an emergency arbitrator (or a regular arbitral tribunal). However, pursuant to section 12(6) of the Act, all orders made by an arbitral tribunal are, by permission of the Singapore court, enforceable in the same manner as if they were orders made by the court. That is, parties may apply to the court for permission to enter the order issued by the tribunal as a judgment of the court (CXG and another v CXI and others [2023] SGHC 244). Pertinently, since section 2(1) of the Act defines “arbitral tribunal” to include an emergency arbitrator, there is no separate question of enforceability of orders made by emergency arbitrators in Singapore.

Similarly, regarding the second recommendation, the inclusion of emergency arbitrators in the definition of the term “arbitral tribunal” in the Singapore International Arbitration Act allows a court to exercise powers in support of arbitral proceedings in non-urgent cases if an emergency arbitrator permits, even if the other parties do not agree (section 12A(5)).

4. New test for identifying the governing law of the arbitration agreement

The Final Report proposes to simplify the analysis on the governing law of an arbitration agreement. Moving forward, under English law, in the absence of an express choice of law of the arbitration agreement, the arbitration agreement will simply be governed by the law of the seat of the arbitration. 

This new position will deviate from the approach in Singapore, which is closer to the pre-reform English approach. In Singapore, the recent Court of Appeal decision of Anupam Mittal v Westbridge Ventures II Investment Holdings [2023] 1 SLR 349 affirmed a three-stage test to determine the proper law of the arbitration agreement. The three stages require the following considerations.

• Stage 1: Whether the parties expressly chose the proper law of the arbitration agreement. If they did, their express choice generally will be upheld.
• Stage 2: In the absence of an express choice, whether the parties made an implied choice of the law to govern the arbitration agreement, where the starting point for determining the implied choice of law would be the law of the main contract.
• Stage 3: If neither an express choice nor an implied choice can be discerned (e.g., where even the governing law of the main contract is not specified or where the application of the law of the main contract would render the arbitration agreement ineffective), to look to the system of law with which the arbitration agreement has its closest and most real connection. This likely will be the law of the seat of arbitration.

Therefore, in the absence of an express choice of law of the arbitration agreement, the starting point under Singapore law is that the law of the main contract will be the implied choice of law governing of the arbitration agreement; under the reformed English law, the default position will be that the law of the seat will apply as the law of the arbitration agreement.

5. No reform of the ability to appeal on points of law

The English Law Commission has decided to continue to allow parties to appeal an arbitral award on a point of law (under section 69 of the English Arbitration Act) unless they opt out of this right.

At present, in Singapore, the right to appeal on a point of law is available only in domestic arbitrations. Parties to an international arbitration cannot appeal against an award on a point of law, unless they have opted into the (domestic) Arbitration Act regime, instead of the International Arbitration Act regime.

In 2019, Singapore’s Ministry of Law undertook a public consultation on proposals to amend the International Arbitration Act. One of the contemplated changes was to allow a party to arbitral proceedings to appeal to the court on a question of law, provided the parties agreed to opt in to this mechanism. The issue was also taken up by the Law Reform Committee of the Singapore Academy of Law, which published a report recommending an opt-in appeal mechanism. However, the Ministry of Law has yet to announce whether it is going ahead with the proposed amendments to the Singapore International Arbitration Act.

The Ministry of Law, Public Consultation on Proposed Amendments to the International Arbitration Act (26 June 2019) can be accessed here.

The Singapore Academy of Law, Law Reform Committee, Report on the Right of Appeal Against International Arbitration Awards on Questions of Law (February 2020) can be accessed here.