06 March 2015
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Blogger Alex Au fined for contempt of court

Straits Times
06 Mar 2015
Selina Lum

BLOGGER and gay rights activist Alex Au was fined $8,000 yesterday for scandalising the judiciary.

He was punished for an article he posted on his Yawning Bread site in 2013, which had implied partiality on the part of Chief Justice Sundaresh Menon in the way two constitutional challenges against the law criminalising sex between men was handled.

Au, 62, paid the fine yesterday and also delivered a conditional apology after Justice Belinda Ang asked his lawyer, Mr Peter Low, if his client was prepared to offer one.

Au said: "At the hearing, my counsel had argued that I did not make such imputations, but in light of Your Honour's findings, I apologise to the court for those imputations."

He later told the media he is appealing against the decision to hold him in contempt. He said: "I am confident that I would be fully exonerated on appeal."

The Attorney-General's Chambers, which asked for a fine of at least $10,000 yesterday, launched contempt proceedings against Au for two articles he published in 2013.

In January, Justice Ang found that one of the articles constituted "scandalising contempt" - and risked undermining public confidence in the administration of justice in Singapore.

The article was published on Oct 5. In it, Au referred to two separate challenges to strike down Section 377A of the Penal Code, which criminalises gay sex. One challenge was launched by Mr Tan Eng Hong in 2010 after he was caught with a man in a toilet. The other, by gay couple Gary Lim and Kenneth Chee, was filed three months after Mr Tan was allowed to proceed in 2012.

In his article, Au wrote of how the couple's case was heard first - and reached the Court of Appeal earlier - even though Mr Tan had launched his challenge before them. Au put this down to "strange calendaring" to allow CJ Menon to sit on the three-judge Court of Appeal panel hearing the constitutional challenge against S377A.

But he could not do this in the earlier case due to a conflict of interest, Au wrote, as Mr Menon was the Attorney-General at the time Mr Tan's criminal case was before the courts.

Justice Ang cleared Au of contempt in the second article, published on Oct 12, which referred to legal proceedings brought by a man who claimed he was harassed into resigning from department store Robinsons because he is gay.

selinal@sph.com.sg

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RBC Properties Pte Ltd v Defu Furniture Pte Ltd - [2014] SGCA 62

State Ct RC No 10 of 2014 - eLitigation shut-down in State Courts

State Courts

Experience counts more than rankings: Forum

Straits Times
06 Mar 2015

AS A law student completing my final year at King's College London, I am thankful Mr Dharmendra Yadav has spoken up for our overseas community and backed up his points with his own experience ("Rationale for axing law schools not convincing"; Forum Online, Tuesday).

The path he took and the tenacity he had in pursuing what he really wanted to do is a good example of why the attitude and grit of a person should matter more than which school he comes from.

While my university has been kept on the list, I sympathise with those who have a shared British experience.

I was happy with staying in Singapore for my tertiary education, but it was my parents who strongly encouraged me to head overseas because they wanted me to benefit from living overseas independently.

I cannot thank them enough for their foresight, which, back then, I could not fully appreciate.

Having now lived in London and gone to law school there for almost three years, I find the experience of living overseas an education in itself.

For students who are exploring university options, it can be a very stressful and confusing time for them because of the myriad of options that are available.

In fact, even after entering university, students are still largely unsure of their future - we are not guaranteed success or jobs, for that matter.

Professor Simon Chesterman's comments downplay the overseas experience we hold dear and only serve to reinforce unhealthy prejudices based on rankings, something we need to move away from ("Shorter list of approved UK law schools welcomed"; Feb 26).

We should be encouraged to pursue what we really want if it is within our means. It should not be made to seem that only a law degree from a top university is worth the tens of thousand of pounds - every degree is valuable depending on what the individual brings to it, whether done overseas or locally.

Singapore's job market should be left to do what it is supposed to, just like any other country's - to hire well.

Au Yard Onn (Miss)

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Wong Swee Hor v Tan Jip Seng and others - [2014] SGHC 263

Sup Ct RC No 4 of 2014 - e-Litigation shut-down in Supreme Court

Supreme Court

Focus on skills of lawyers: Forum

Straits Times
06 Mar 2015

MUCH has been said about the delisting of some British law schools ("Shorter list of approved UK law schools welcomed"; Feb 26, "Aussie legal education more relevant" by Ms Josephine Chong; Tuesday and "Much relevance in British legal education" by Ms Tan Tian Hui; yesterday).

However, we need to work backwards and ask ourselves: What are the top skills of a good lawyer and how do we ensure our lawyers can apply these skills at the desired competency level when they start work in Singapore?

First, a good lawyer must have critical thinking skills.

The lawyer's legal reasoning skills are correlated to the quality of advice. The lawyer must be able to intelligently apply the law to a given set of facts and analyse the prospect of success fast.

Second, the lawyer must be able to connect with and manage clients well. It is critical to build rapport with clients to instil trust and confidence, for a smooth business relationship.

The lawyer must be able to communicate how the legal work contributes to achieving the client's goals.

Third, the lawyer must be persuasive - a good communicator, presenter and negotiator.

Fourth, the lawyer must be operationally efficient - able to incorporate useful legal technology into his law practice workflow to increase productivity and reduce costs.

A law school focuses on teaching the "hard law" and legal reasoning skills, but usually does not cover the other skills.

The six-month pupillage is very helpful but too short to assist the marginal pupil.

The Bar exam is a fair, independent and merit-based sieve, but it is not designed to guarantee that all who pass will end up as good lawyers.

The Continuing Legal Education (CLE) programme should be strengthened to include a compulsory competency test after every four years of practice, in addition to the CLE points system.

In this way, lawyers will have to keep upgrading. Ultimately, it is the market that decides the business success or failure of lawyers.

Eric Ignatius Pereira

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Goi Wang Firn (Ni Wanfen) and others v Chee Kow Ngee Sing (Pte) Ltd - [2014] SGHC 261

Sup Ct RC No 3 of 2014 - Guide for conduct of companies, insolvency, equity & trust and arbitration suits

Supreme Court

Singapore ranked No. 5 for IP protection

Straits Times
06 Mar 2015
Jacqueline Woo

SINGAPORE has won praise for creating a robust environment where intellectual property (IP) rights are protected and enforced.

The Republic has been ranked No. 5 among 30 economies assessed by the Global Intellectual Property Centre (GIPC), part of the US Chamber of Commerce that manages IP-related issues.

It scored 25.38 points out of a possible 30 in the International IP Index, behind the US - which topped the list at 28.53 points - Britain, Germany and France.

This is higher than its score of 25.12 points in the previous edition of the index, even though it had been ranked fourth among the 25 economies then.

Thailand logged the lowest score at just 7.1 points, followed by India and Vietnam.

The economies, which did not include Hong Kong, were evaluated based on 30 criteria, including the protection and enforcement of patents, copyrights, trademarks, trade secrets and participation in relevant global treaties.

Singapore's better performance was due to policy amendments introduced last July, which successfully strengthened its copyright regime, particularly against online piracy, said the report.

"It sends a strong message that Singapore is doing something right," GIPC executive vice-president Mark Elliot told The Straits Times yesterday.

"The country has established a very solid rule of law around IP protection, and it's quite clear that much economic investment has occurred here as a result of the Government having established this framework over many years."

But some areas of weaknesses remain, such as the country's regulatory data protection term, which Mr Elliot felt should be extended from five to 12 years, in line with that in the US and the European Union.

This would help biopharmaceutical firms particularly, and enable Singapore to develop further as a regional biomedical hub.

"IP drives innovation and leads to strong economies with good-paying jobs, something every country hopes to achieve," added Mr Elliot.

"Countries that do particularly well in attracting investment are those that spend time looking at where innovations are going, anticipating and then putting in place the IP protection measures needed to drive those innovations."

tsjwoo@sph.com.sg

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Fairmacs Shipping & Transport Services Pte Ltd v Harikutai Engineering Pte Ltd and another - [2014] SGHC 262

MAS consults on proposals for securities-based crowdfunding

Business
05 Mar 2015

Industry price-fixing probe sets cat among chickens

Straits Times
06 Mar 2015
Jessica Lim

Watchdog acting on complaint; slaughterhouses deny collusion

THE fresh chicken industry here, including slaughterhouses, is being investigated by the Competition Commission of Singapore (CCS).

The Straits Times understands that the investigation began late last year after a complaint was made. The issue: price-fixing, according to the Poultry Merchants' Association.

Several members, said the association's secretary, Mr Chew Kian Huat, have been questioned, including his own slaughterhouse, Sinmah Poultry Processing.

Customers, such as hotels and fast-food chains, have also been interviewed by the CCS, said slaughterhouse operators.

A check found that several - including Hup Heng Poultry Industries, Tong Huat Poultry Processing Factory, and Lee Say Poultry Industrial - were asked to explain their pricing policies.

When contacted, the CCS confirmed that it was "conducting an investigation into the live chicken slaughtering and fresh chicken distribution industry". It was unable to provide further details due to ongoing investigations.

About 120,000 live chickens are trucked in from Malaysia daily. They are killed at 10 slaughterhouses here, then transported to wet markets, hotels, eateries and supermarkets. Malaysia is the sole supplier of live chickens here. Some buyers, like hotels, call for tenders every six months, with suppliers bidding to sell the fresh chicken to them.

Slaughterhouse operators questioned by the CCS denied fixing prices. Mr Tan Koon Seng, director of Lee Say, which slaughters 25,000 chickens a day, said: "As a businessman, I won't want to tell competitors my pricing strategy. What if they purposely undercut me? We are not friends, we are enemies." Prices for his chicken range from $3 to $5 per kg.

Hup Heng co-owner Ma Chin Chew, 47, said it is impossible to fix prices - his prices change every month depending on the costs. He last revised his prices up by 20 cents before Chinese New Year, when his supplier raised prices. He now charges $5 to $6 per kg.

At Tong Huat, prices exceed $5 per kg. Its human resource manager, Mr Charlie Toh, said: "We supply to supermarkets and we help them package the chicken so we charge more."

The Poultry Merchants' Association's Mr Chew said that there is no collusion among members. "We are not scared because we didn't do anything."

Price-fixing is illegal here. When the CCS finds that a firm's practices have hurt fair competition, it can impose a fine of up to 10 per cent of its annual turnover in Singapore for each year of infringement up to three years.

When contacted, the FairPrice supermarket chain said it does not condone anti-competitive measures like collusion and price-fixing. The Consumers Association of Singapore said it has not received any complaints but supported CCS' move to investigate.

Mr Chia Kar Wing, owner of restaurant Union Farm, known for its paper-wrapped chicken, said: "We will wait and see. If they are found to be price-fixing, then, hopefully, chicken prices will go down."

limjess@sph.com.sg

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LH Aluminium Industries Pte Ltd v Newcon Builders Pte Ltd - [2014] SGHC 254

Consultation paper on proposed amendments to MAS Notice 648 on issuance of covered bonds by banks incorporated in Singapore

Business
05 Mar 2015

New carpool laws allow drivers to be paid

Straits Times
06 Mar 2015
Christopher Tan

Change gets mixed reactions from car owners, public transport users

A CAR owner can now accept payment from passengers who hitch a ride.

This and other rules and regulations governing carpooling came into effect on Monday under the Road Traffic Act in an effort to bring legal clarity to what was a grey area.

The move is also expected to boost car sharing, which in turn should ease congestion on the roads and on public transport.

The new laws state that it is illegal for drivers to solicit for passengers on the road, in public spaces or parking lots.

A vehicle is primarily for the motorist's own use and not bought for the sole purpose of offering paid rides.

Destinations of passengers must be clarified before the journey and drivers cannot offer more than two rides per day.

The most interesting inclusion to the laws allows drivers to accept monetary compensation or payment in kind for offering rides - though it should not be for profit.

"The amount or the value of any benefit in kind that the person collects from the passenger as payment does not exceed the cost and expenses incurred for the carriage of the passenger," the statute reads.

If there is more than one passenger in the car, the total payment must not exceed the expenses incurred for the trip - such as the cost of fuel or electronic road-pricing charges.

Technopreneur Moh Hon Meng, 46, who started ShareTransport.sg in 2012, welcomes the new laws.

"The biggest obstacle to carpooling taking off is that people are unsure of what the law says," he said, adding that people will now be more willing to do so.

On average, about 1,300 carpooling messages are posted on ShareTransport.sg each month. Mr Moh said he does not charge users, but will work with commercial entities such as oil companies and tyre retailers to offer services on his site to generate revenue.

Several car owners The Straits Times spoke to, however, said they would still not offer rides, citing inconvenience and privacy, among other things. But businessman Thomas Lim, 62, believes it is "a good idea", adding: "I'm all for it."

Public transport users also gave it the thumbs-up.

Human resource consultant Henry Ling, in his 60s, said: "It makes sense for people going in the same direction to carpool... rather than driving with four empty seats."

Lawyer Bryan Tan, 44, who commutes by taxi, said his main reservation is safety. "I need to know that the persons I'm sharing the ride with are safe."

christan@sph.com.sg

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Li San Zhong v Time Inc - [2014] SGIPOS 14

101 on AEC 2015

Business
05 Mar 2015

OW Bunker and the failure in governance

Business Times
06 Mar 2015
Mak Yuen Teen & Christopher Bennett

Lack of transparency and conflicts of business roles are among the underlying causes of the collapse of the global marine fuel logistics firm

ON NOV 6, 2014, news broke about an alleged fraud and risk-management failure at Dynamic Oil Trading (DOT), one of the two Singapore subsidiaries of OW Bunker A/S, a Danish global marine fuel logistics company which listed on the Nasdaq OMX Copenhagen on March 28 last year.

Apparently, DOT's CEO and finance manager had extended a credit of US$125 million to Tankoil Marine Services, a Singapore bunker supplier, without the approval of the parent's board of directors. A loss of US$150 million was also discovered after a review of the company's risk exposure. OW Bunker and several subsidiaries then filed for bankruptcy. Two key DOT employees were reported to the authorities and the chief risk officer (CRO) was fired.

OW Bunker's initial public offering (IPO) prospectus described approval authorities for credit lines in some detail. Non-compliance with authorisation limits and poor risk management were the proximate causes of the company's collapse. However, media reports and public disclosures by the company suggest a number of underlying causes.

Organisational culture and incentives: In cases like OW Bunker, incentives (in the widest sense) and remuneration structures almost always play a part as they are a primary way in which organisational culture is created and sustained.

The company, apparently, had a culture of aggressive risk-taking. Kenneth Rosenmeyer, a former risk manager and 13-year veteran of OW Bunker, was reported to have been given the special task of securing the company major million-dollar profits by trying to "beat the market" (shippingwatch.com dated Nov 21, 2014). He said: "I had a budget that required me to make a US$1.5 million profit every month. It was speculation." He quit in March 2014 shortly after the IPO, saying that listing would make it more difficult for him to maintain good results.

Turning to the remuneration policy, OW Bunker stated in its prospectus: "In accordance with the remuneration policy and section 139 of the Danish Companies Act, we have adopted overall guidelines on incentive pay for the board of directors and executive management, which have been approved by the general meeting of the shareholders of the company. The guidelines are available on our website, www.owbunker.com." Unfortunately, those guidelines are no longer there. The 2013 annual report and prospectus make some remuneration disclosures. The remuneration package for key management consists of a fixed base salary, a short-term cash bonus, a long-term stock option incentive, and other benefits. OW Bunker does not disclose remuneration for directors and key management on an individual basis because it considers remuneration to be a private matter.

The two members of key management were paid total fixed salaries of 5.3 million Danish kroner(S$1.1 million) and cash bonuses of 7.6 million kroner for the year ended Dec 31, 2013. Two other key employees, including the executive vice-president (EVP) of physical distribution, were paid total fixed salaries of 3.1 million kroner and cash bonuses of 6.6 million kroner.

From this information, we can see that cash bonuses constitute a significant proportion of total remuneration, especially for the key employees. However, to assess if the remuneration policy overly rewarded short-term profitability and promoted excessive risk taking, the bonus potential (rather than bonus paid) and the performance measures used for granting and vesting cash bonuses and share-based incentives need to be considered - but, unfortunately, like many other companies, this information is not publicly available.

Conflict of roles: The EVP of physical distribution also acted as CRO. A CRO advises and assists the board and senior management in implementing risk-management practices. As EVP of physical distribution, she has an important business role that entails risk taking. She clearly faced a conflict between her CRO and business roles, which would have been aggravated by a remuneration policy encouraging aggressive risk-taking.

Financial disclosure: In its prospectus, OW Bunker reported significant growth in its Singapore operations and disclosed that for the year ended Dec 31, 2013, they contributed US$4.8 billion of the US$17 billion total group revenues. Based on the financial statements of the Singapore subsidiaries we obtained, DOT's revenues from its incorporation on Aug 24, 2012, to Dec 31, 2013, were about US$2.1 billion. OW Bunker Far East (OBFE), the other Singapore subsidiary, had revenues of about US$3.3 billion in 2012 and US$4.7 billion in 2013. DOT or OBFE were not mentioned in the prospectus and according to shippingwatch.com (Nov 14, 2014): ". . .OW Bunker CEO Jim Pedersen never mentioned the Singapore success story during the more than 100 meetings with investors and analysts ahead of the IPO. At least not the part about Dynamic Oil Trading. There is not one word about DOT in the 272-page prospect (sic), and the company is only mentioned in the annual report in a note listing OW Bunker's more than 50 subsidiaries."

OW Bunker has also been criticised for not being transparent about its use of derivatives for trading, and not just for hedging. The extremely rapid growth of its Singapore operations should probably have raised some questions from the board, senior management and other stakeholders, about business practices, risk management and corporate governance in its Singapore subsidiaries.

Subsidiary governance: We have previously published a commentary about the problems of governance of group entities, including subsidiaries ("Director's dilemma in a subsidiary", BT, Aug 15, 2012). This was followed by our report "Governance in Company Groups", published by CPA Australia and ICLIF Leadership and Governance Centre last year, which looked at the largest 50 listed issuers in Australia, Malaysia and Singapore. We cautioned that many corporate scandals and failures have their roots in group entities that often pose significant risks but whose governance receives little attention. We highlighted common intra-corporate conflicts between parents and group entities, and conflicts faced by individuals within group entities who often hold multiple roles of director, employee and shareholder representative.

We found that most listed issuers disclosed little about how they govern subsidiaries and group entities, beyond having group policies, committees having group-wide responsibilities, and basic controls like internal audits.

Group entities are incorporated as separate legal entities each with their own board of directors. These boards are often created for legal compliance and perform no substantive governance role. Individuals serving on these boards typically receive very little training on their fiduciary and other duties. The exception is financial institutions where, recently, regulators have imposed governance responsibilities on subsidiary boards. In its 2013 annual report, OW Bunker listed 52 subsidiaries, all but two being wholly owned. One subsidiary, DOT, ultimately caused the collapse of the entire group. Yet, in all the discussions about the scandal, there has been hardly any mention of the role of DOT's board. So, how were DOT and the other Singapore subsidiary, OBFE, governed?

DOT's board had four directors - Gotz Dieter Lehsten, Jim Bojesen Hessellund Pedersen, Morten Skou and Lars Moller. Mr Moller, the only Singapore resident director, was managing director (MD) of DOT. Mr Lehsten, the EVP of reselling, is resident in Germany. Mr Skou is head of strategic development and, until October 2014, CFO of OW Bunker. Mr Pedersen is OW Bunker's group CEO. Simply stated, all four directors of DOT were employees within the group.

DOT is incorporated in Singapore and its directors have fiduciary and other duties under the Singapore Companies Act. They are supposed to act in the best interests of DOT. Did the board of DOT actually perform any governance role? In making decisions relating to DOT, were the directors motivated primarily to act as employees of the group or as directors of DOT?

The approval authorities for credit lines disclosed in the prospectus indicate that the board of DOT had no role in approving credit lines - they were either approved by local managers, group credit director, group credit committee, group CEO or parent board. The board of the other Singapore subsidiary, OBFE, was comprised of two directors, both employees within the group - Mr Lehsten and Harreby-Thomsen Sonnich, the MD who is resident in Singapore.

Public reports indicate Mr Sonnich is also the trading manager of OW Bunker & Trading A/S and leads the South-east Asia centre from Singapore. The creation of separate legal entities is frequently driven by tax, risk-management or regulatory considerations. Many subsidiaries in company groups, especially wholly owned subsidiaries such as DOT and OBFE, are essentially managed like business units or divisions. "Boards" are made up solely or mainly of employees of the group and are often creations of form not substance. This leads to a governance lacuna with resultant moral hazard:

• Directors of the ultimate parent company (in most countries) only owe fiduciary duties to the company of which they are directors, not to the entire group. In practice, they and key management in the parent company have the ability to make decisions within subsidiaries without legal accountability.

• Directors of subsidiaries owe fiduciary duties to those subsidiaries. In reality they have limited ability or incentive to perform their governance role. Often, their employment responsibilities are more important to them. Their legal duties as directors to the subsidiary are rarely enforced.

If this state of affairs continues, we expect companies to continue to create separate subsidiaries and other legal entities and to push more risky and questionable decisions into these group entities. We can only see more trouble ahead in the governance of subsidiaries and group entities unless there is increased attention on the subject.

The writers are, respectively, associate professor of accounting at NUS Business School and founder of BPA Australasia

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Chandra Winata Lie v Citibank NA - [2014] SGHC 259

Proposed guidelines on good drafting practices for prospectuses and proposals to facilitate better understanding of prospectuses

Business
05 Mar 2015

New Centre for Dispute Resolution to take more holistic approach

Business Times
05 Mar 2015
Nisha Ramchandani

[Singapore] A CENTRE for Dispute Resolution has been launched at the State Courts to pull together the different alternative dispute resolution (ADR) services under one roof.

Speaking at its launch on Wednesday, Chief Justice Sundaresh Menon said: "The centre aims to adopt a holistic approach to dealing with each dispute. Many disputes will involve different aspects of the law, and might even cut across the civil/criminal divide."

He added that ADR should be the first step in any type of dispute, as it offers an opportunity to bring relief to the parties at an early stage, regardless of the legal nature of the claim.

A survey has shown that mediation of claims can lower legal costs, reduce time spent in court and deliver more-favourable results than going to trial can.

ADR processes now offered by the centre are mediation and neutral evaluation, the latter referring to assessing the merits of the case.

The centre will handle civil claims such as those arising from motor accidents and personal injury, Magistrate's Complaints filed for minor criminal offences and other relational disputes such as applications under the Protection from Harassment Act.

Before the centre was launched, all civil claims were directed to the Primary Dispute Resolution Centre for ADR; Magistrate's Complaints were referred for mediation in the State Courts' Crime Registry, and pre-trial resolution for specific criminal matters were handled via Criminal Case Resolution Conferences.

Among other things, the centre will also focus on improving the quality of ADR provided for motor accident and personal-injury cases by tightening the process for the resolution of such claims, as well as on encouraging court volunteers to take part in ADR by creating progression pathways and learning programmes for them. It will also boost its collaboration efforts with ADR agencies, the universities and the Bar.

Guidelines will be passed for mediation via internet communication programme Skype for parties residing overseas and who may be unable to travel to Singapore for the proceedings; these guidelines would also be for mediation involving foreign incorporated entities with no local representatives.

The centre has seven judge mediators and more than 100 volunteer mediators. All the judge mediators have been accredited by the Singapore Mediation Centre (SMC); some have been trained by internationally-renowned programmes such as London's Centre for Effective Dispute Resolution. Volunteers include members of the Bar, Justices of Peace and mediation professionals.

Chief Justice Menon also announced that ADR fees will be introduced for District Court civil claims, likely from May. This will relate to higher-value civil claims between S$60,000 and S$250,000.

The State Courts have been offering ADR services for free since the 1990s. Services for other claims - Magistrate's court claims, motor accident claims, personal-injury claims and Magistrate's complaints - will remain free.

Chief Justice Menon said: "While the vast majority of lawyers and court users have found this beneficial, a minority have taken it for granted and, as a result, have come ill-prepared for sessions or make late requests for adjournments.

"Our stakeholders have also highlighted the need to put in place a system that reflects the value of the work mediators do."

The Mediation in Singapore: A Practical Guidebook was launched on Wednesday. Jointly edited by George Lim S. C. and Danny McFadden, managing director of the Centre for Effective Dispute Resolution in the Asia-Pacific, the book traces the growth of mediation in Singapore, with contributions from mediators from the National University of Singapore, the Ministry of Law and the SMC.

nishar@sph.com.sg

Source: Business Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Ten Leu Jiun Jeanne-Marie v The National University of Singapore - [2014] SGHC 247

Securities and Futures Act: MAS issues consultation paper on proposed amendments

Legislation
04 Mar 2015

Caning not unconstitutional: Apex court

TODAY
05 Mar 2015
Yvonne Lim

Convicted drug trafficker Yong Vui Kong loses appeal after arguing punishment tantamount to torture

SINGAPORE — The punishment of caning is not unconstitutional, the apex court ruled yesterday, throwing out the latest in a string of legal challenges mounted by convicted drug trafficker Yong Vui Kong.

After he became the first to escape the gallows following changes to the mandatory death penalty regime, the 26-year-old Malaysian last year sought to be spared from the 15 strokes of the cane he was re-sentenced to, by arguing that the punishment violated the Constitution.

However, his bases for the contention that caning is tantamount to torture were dismissed by the Court of Appeal yesterday.

Prescribed as a punishment for selected crimes in Singapore, caning differs from the cases defined as torture under a United Nations convention, which either involved “severe and indiscriminate brutality”, or extra-legal acts of abuse in interrogations and war crimes, said the court, which was presided over by Chief Justice Sundaresh Menon.

There are also legal requirements, enshrined in statute, on how the punishment is carried out here, the judges added. For example, a medical officer must be present and caning starts and continues only if the offender is certified to be fit enough.

“It is undeniably the case that caning inflicts a considerable level of pain and suffering on a prisoner. But this level of pain and suffering is far exceeded by that endured by the victims in those cases where courts held that the conduct in question amounted to torture,” they said.

The judges, who included Appeal Judge Andrew Phang and Justice Tay Yong Kwang, added that these statutory requirements act as “safeguards” to ensure caning in Singapore’s prisons “does not breach the high threshold of severity and brutality that is required for it to be regarded as torture”.

For instance, caning is administered on the buttocks, which minimises the risk of injury to bones and organs, they said. It is also carried out in private and out of sight of other prisoners.

The rattan, which is soaked in water beforehand to prevent it from splitting and shearing the skin, is also treated with antiseptic, while the strokes of the cane are “meted out in a measured and controlled manner at regular intervals”, the judges added.

How international law norms regard caning is also irrelevant, the court said, since Parliament has prescribed for caning under Singapore’s laws, and the judiciary is bound to implement legislation, as long as they are not incompatible with the Constitution.

A similar line of reasoning defeats another of Yong’s argument against caning, which was that it is too irrational and arbitrary to be regarded as law, since its deterrent effect is unclear.

In response, the judges said: “The simple answer is that sentencing policy is a matter for the legislature and it is not for the courts to judge whether a particular type of sentence prescribed by Parliament is justified as a matter of deterrence.”

Yong’s argument that caning discriminates against men under 50 — the punishment is not carried out on an offender above that age — is also without merit, the judges said.

This differentia clearly serves the objective of ensuring that only those who are physically fit to be caned suffer the punishment, they said.

In addition, the criteria for exclusions are policy decisions that Parliament is entitled to make and “there is no justification for us to interfere”, the judges added.

Yesterday’s court decision marked the end of a series of legal bids Yong has launched since he was caught in 2007 as a 19-year-old for trafficking 47.27g of heroin.

These ranged from his appeal against the compulsory death sentence originally handed down to him to his challenge on the lack of discretion for the President to grant clemency.

Suspended from legal practice pending a psychiatrist’s assessment, Yong’s lawyer M Ravi was in court yesterday to observe proceedings.

yvonnelimsy@mediacorp.com.sg

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AOD, a minor suing by the litigation representative v AOE - [2014] SGHCR 21

Singapore Budget 2015 - Measures affecting employers

Business
04 Mar 2015

Court bars man from moving children to Spain

TODAY
05 Mar 2015
Neo Chai Chin

Relocation would uproot kids from lives here, reduce contact with their mother, judge rules

SINGAPORE — Disallowing a Singaporean man from relocating to Spain with his new family and two of three children from his previous marriage, the High Court has ruled that the move is not in the children’s interests.

The man had wanted to try living in Spain because his current wife, who is Spanish but a permanent resident here, cannot practise as a doctor in Singapore, but Judicial Commissioner (JC) Debbie Ong said this would mean uprooting the children from their lives here and reducing their contact with their American mother.

“I find that, on balance, the need to relocate is not as strong as the need for the family to remain in Singapore at this time,” said JC Ong in dismissing the father’s appeal against the District Court’s refusal last year to allow his “unreasonable” relocation.

Children have been allowed to relocate in most recent reported court decisions, except one, wrote JC Ong in her judgment made publicly available yesterday. In those cases, the courts seemed to have focused more on whether the custodial parents were reasonable and less on the loss of the relationship with the other parent, she noted.

While a decision to relocate may not be unreasonable or in bad faith, it is not necessarily the same as a decision made in the children’s best interests, she said. It is important not to focus so much on the reasonable wishes of the custodial parent, such that there is “practically a presumption in favour of relocation once it is found that the primary carer’s decision is not unreasonable”, she added.

Factors the judge considered included the man’s reasons for relocation, the uprooting of the children and the loss of the relationship with their mother. While ties between the mother and children deteriorated with the breakdown of the marriage, which ended in November 2009, JC Ong noted that she was trying to turn things around. Relocation would likely sound a death knell for the relationship, she wrote.

The judge also noted that the oldest child is studying at a local polytechnic and intends to continue living here, so relocation would break up the siblings. The two younger children, aged 11 and 14, would also be placed in a different education system in which English was not the main language used.

“While one should not underestimate the risk of negative effects on the child arising from frustrating the plans of the parent who is the child’s primary carer, this must be balanced against the law’s expectations that parents must place the needs of their children before their own,” wrote JC Ong. She added that a refusal to allow relocation did not mean a move was not possible in future.

However, four months before the appeal was heard in January, the man had taken the two younger children to Spain and it is unclear whether they have returned.

chaichin@mediacorp.com.sg

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Pawnbrokers Act 2015 (Act 2 of 2015)

Recent amendment to the Singapore Companies Act: Buyout remedy in s 254(1)(i) – a shifting paradigm?

Legislation
04 Mar 2015

Astro wins a stunning reversal in legal battle with Lippo in HK

Straits Times
05 Mar 2015
K.C. Vijayan

MALAYSIAN billionaire T. Ananda Krishnan's Astro group, which effectively lost a US$130 million award in Singapore's highest court against Indonesia's powerful Lippo group, has scored a stunning reversal in Hong Kong.

A judge there ruled last month that the satellite TV operator can seize assets from Lippo's First Media and two of its other arms, as it tries to claim the sum.

The award was the outcome of a 2010 arbitration panel decision here, after a failed joint pay-TV venture between Mr Ananda Krishnan and Indonesian tycoon James Riady, who helps run Lippo. First Media challenged enforcement of the award and the apex appeal court here ruled substantially in its favour in 2013.

It found that the sued Lippo units - First Media and Ayunda Prima Mitra - were required to pay only about US$700,000 to five units of Astro which had sued them, effectively overturning the original arbitration award.

The Singapore appeal court noted that while eight Astro units had sued three Lippo units to enforce the arbitration award in Singapore, three of the Astro units seeking the bulk of the sum could not enforce the award against First Media as they were not parties to the arbitration agreement.

Meanwhile, Astro applied in Hong Kong to enforce the award and seize any Hong Kong-based assets linked to First Media.

The Hong Kong court order was served on First Media in October 2010, which allowed a two- week deadline for a challenge to be mounted. Initially, First Media believed it did not have any assets in Hong Kong. But in 2011, Astro successfully applied to garnish US$44 million in assets from AcrossAsia, a Hong Kong-listed affiliate which owed the money to First Media. Only then did First Media apply to have the order set aside, some 14 months after the deadline had passed.

High Court judge Anderson Chow, in judgment grounds released yesterday, was not convinced by its reasons for doing so.

Astro's Queen's Counsel David Joseph had argued the two-week time limit was "designed to underline and support the important principle of speedy finality which underpins the whole of the (law)".

Judge Chow found that the challenge came after a "very substantial" delay, saying: "First Media took a calculated risk regarding the presence, or absence, of assets in Hong Kong. As events turn out, the risk has now materialised. I do not see why the court should then come to the aid of First Media and assist it to get out of its self-inflicted predicament."

Judge Chow added that although First Media had successfully resisted enforcement before the Singapore Court of Appeal, the Singapore court was acting in its capacity as "the enforcement court, not as supervisory court".

"The awards have not been set aside. They are still valid and create legally binding obligations on First Media to satisfy them."

First Media is appealing.

vijayan@sph.com.sg

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Foreign Employee Dormitories Act 2015 (Act 3 of 2015)

Bilateral investment treaty interpretation: An ‘internationalist spirit’ tempered by context: Government of the Laos People’s Democratic Republic v Sanum Investments [2015] SGHC 15

SLW Commentary
03 Mar 2015

Much relevance in British legal education: Forum

Straits Times
05 Mar 2015

MS JOSEPHINE Chong's view of legal studies in Britain is not a complete one ("Aussie legal education more relevant"; Tuesday).

She said modules such as European Union law in British universities may be irrelevant for practice in Singapore. This misses a few points.

First, the purpose of a legal education goes beyond learning the content of the law. Many lawyers in practice would, perhaps, no longer remember the bulk of what they learnt in law school.

Instead, legal education equips one with critical thinking and analytical skills that are content independent.

Second, Ms Chong said the modules offered in British universities are comparably less relevant than those of Australian universities.

A look at some of the Australian universities reveals that courses may not be as relevant as Ms Chong claims.

For example, at Monash University - a recognised university for admission to the Singapore Bar - the compulsory constitutional law module involves the study of Australian federalism.

An overseas legal education is bound to include an element of localisation. It is important for students to distil the relevant legal principles and apply them in practice.

Ms Chong also said that some relevant British modules, for example, company law, are not compulsory, which disadvantages law graduates seeking Singapore qualification.

However, it is up to law graduates to exercise their discretion in choosing their modules. Beyond compulsory modules that are foundational to one's legal studies, a legal education provides students with opportunities to explore their academic interests, and does not define the scope of their interests.

Finally, Ms Chong said British law itself has diverged from common law. Singapore law finds its roots in British law, and, till today, key aspects of our legal system are derived from the British legal system. Our case law continues to make reference to British jurisprudence.

I did my undergraduate and postgraduate law studies in Britain and have found my legal education there integral to developing skills which will undoubtedly be useful for practising law in the future.

Tan Tian Hui (Ms)

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Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 13) Notification 2015 (S 111 of 2015)

Probing the law on probation: Suggestions for reform

Judgments
02 Mar 2015

Advantages of British legal education: Forum

Straits Times
05 Mar 2015

AN AUSTRALIAN law school education is not likely to be more relevant than that from a British university ("Aussie legal education more relevant" by Ms Josephine Chong; Tuesday).

A typical British undergraduate law programme includes European Union law as an optional course, which is relevant for Singapore's free trade agreement (FTA) with the EU. Understanding EU law is important as both sides are major trading partners.

While EU law is taught as an optional course, the Solicitors Regulation Authority and Bar Standards Board in England and Wales require students to pass the subject for a qualifying law degree.

Other optional courses taught in a British undergraduate law programme include commercial and company law. The optional courses are not disadvantageous for graduates of British law schools returning to Singapore, as they take the Singapore Institute of Legal Education conversion course with other foreign law graduates.

The rules of common law are unwritten and cannot be found in any particular place. Even though there are basic similarities, Singapore law cannot have more commonality with Australian law than British law, as the legal systems of Australia and Singapore are derived from that of Britain.

British three-year direct honours degree programmes are as rigorous as Australian four-year courses, with the submission of a dissertation as a final component.

Graduates from a recognised Diploma in Law programme can transfer into the second year of a British undergraduate law course. Therefore, the British programme does not have less relevant modules than its Australian counterpart.

Tng Cheong Sing (Dr)

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Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 12) Notification 2015 (S 110 of 2015)

Offer to settle: Ong & Ong v Fairview Developments [2015] SGCA 05

SLW Commentary
02 Mar 2015

MAS: Proposed changes won't hamper well-managed insurers

Business Times
05 Mar 2015
Claire Huang

Plans to amend risk-based capital framework are part of regulator's move to make insurance sector more resilient

[Singapore] THE proposed changes to the risk-based capital framework will be more risk-sensitive, robust and fit-for-purpose, but should not hamper well-managed insurance businesses unduly.

The changes, also known as RBC 2, seek to reflect the relevant risks insurers face and are part of the Monetary Authority of Singapore's (MAS) move to make the insurance sector more resilient.

Ong Chong Tee, deputy managing director of financial supervision at MAS, said the regulator will implement RBC 2 only after it has conducted "a thorough calibration and assessment".

He noted that some of the insurers are "naturally anxious" about whether they have to maintain the same high buffers of way above 100 per cent capital adequacy ratio (CAR) or fund solvency ratio (FSR) under RBC 2 as they do under the existing framework.

"This is not our expectation, given that the risk requirements under RBC 2 are designed to be more risk- sensitive, comprehensive and calibrated to a higher target confidence level," Mr Ong stressed, as he addressed the life insurance community at the Life Insurance Association Singapore's (LIA) 13th annual luncheon on Wednesday.

There will also be greater differentiation in the CAR, which assesses insurers' solvency, for insurers with varying risk profiles, he said.

The regulator is also in the midst of going through comments from industry participants on several aspects. They are: widening the eligibility criteria for the matching adjustment feature of RBC 2; the possibility of giving some credit to the illiquid nature of some other liabilities that do not qualify for the matching adjustment; the calibration of risk charges for equities and long-dated corporate bonds; and the calibration of the operational risk charge - something that has been discussed with the industry.

In underlining the need for RBC 2, Mr Ong said the global operating environment for finance, including insurance, has and will become increasingly complex, given the more connected markets and the vulnerability of contagion.

Coupled with an overall low interest rate environment that now pushes investors, including insurers, to target more risky, higher-yielding products and the appearance of potential new risk areas such as in some emerging markets or in technology risks, it is important for Singapore's insurance capital framework to remain relevant and effective, he said.

This is so that insurers operating in Singapore are well-capitalised to weather different crises and risks, said Mr Ong.

The public assurance is the first from MAS since detailed specifications for the first quantitative impact study was released in 2014.

LIA president Khoo Kah Siang welcomed the assurance, saying that insurers are "very appreciative" that MAS has indicated it is open to objectively reviewing some of the feedback provided. "As an industry, we are also very objective in making sure that we are not asking for things that are not reasonable. I think we are also hoping that the framework is good because it is important for the industry to be well-capitalised."

Another study will be conducted in the second quarter of the year.

Previously, the regulator had said that RBC 2 was expected to be rolled out in 2017.

In his address, Mr Ong also announced that the two key initiatives under the Financial Advisory Industry Review - the web aggregator that allows consumers to compare the premiums and features of life insurance products, as well as features of direct purchase insurance products - will be implemented in early April.

Previously, the web aggregator was targeted to be rolled out in the first quarter of the year, while the direct purchase initiative (DPI) was to be implemented in early 2015.

Given the magnitude and complexity of the two initiatives, industry observers have said that more time is needed to hash out their details to ensure greater transparency and efficiency of the distribution of life insurance and investment products in Singapore.

"MAS will continue to work with the industry and consumer groups to conduct regular reviews, to ensure that the product suite and features of the DPI and even of the aggregator itself remain relevant in meeting the needs of the consumers," Mr Ong said.

The two key initiatives, together with the balanced scorecard framework for the remuneration of financial adviser representatives and supervisors, underscore the need to restore trust in the insurance sector by promoting a culture of fair dealing and empowering consumers to make informed choices - objectives that the regulator has been pushing for in recent times.

huangjy@sph.com.sg

Source: Business Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Monetary Authority of Singapore Act - Monetary Authority of Singapore (Freezing of Assets of Persons - Yemen) Regulations 2015 (S 109 of 2015)

Latest developments: Variable interest entity; insolvency and arbitration; Singapore-France Tax Convention; "no set-off" clauses; regulatory framework for secondary listings

Business
02 Mar 2015

Best to check insurance policy terms: Forum

Straits Times
05 Mar 2015

WE THANK Mr Loon Chee How for his query ("Does Advance Medical Directive impact insurance?"; Feb 14).

Further to the response provided by the Ministry of Health ("Advance Medical Directive: Insurance not affected"; Feb 19), generally, insurers will honour claims for deaths resulting from acting on an Advance Medical Directive (AMD).

This is so unless:

• the individual's medical condition falls within an exclusion clause stated in the policy contract; or

• the AMD was obtained under circumstances listed in the Act that include deception or

fraud, or the forging of an AMD; or

• any person withholds personal knowledge of a revocation of an AMD.

The AMD is a legal document that one signs in advance to inform the doctor treating him, in the event he becomes terminally ill and unconscious, that he does not want any extraordinary life-sustaining treatment to be used to prolong his life.

We recommend that individuals speak with their financial advisers to have a clear understanding of the terms of their life policies to ensure that they are appropriately and adequately protected.

Pauline Lim (Ms)

Executive Director

Life Insurance Association Singapore

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Supplementary Supply (FY 2014) Bill (Bill 9 of 2015)

Dismantling human trafficking: The need for a dedicated piece of legislation

Legislation
26 Feb 2015

Sieve aspiring lawyers by Bar exam, not the varsity they went to

Business Times
04 Mar 2015
Choo Zheng Xi

THE recent delisting of eight UK universities from the list of approved overseas scheduled universities (OSUs) by the Singapore Institute of Legal Education (SILE) appears to be a reflexive response to months of news coverage about a glut of lawyers in Singapore. The list of approved foreign universities has been recognised for the purposes of admission to the Singapore Bar.

In recommending the review of the list of OSUs, the high powered 4th Committee on the Supply of Lawyers was careful to caveat in their influential report of May 2013 that the list of OSUs "now operates as a qualitative sieve", whereas it was originally used as a "quantitative scythe". However, SILE's "qualitative" rationale for delisting eight UK universities from the OSU is a controversial one which raises more questions than it answers.

How "qualitative" is the "qualitative sieve"?

To start with the assertion that the recent cull is any accurate reflection of quality control is questionable. The basis for the five-yearly reviews of the OSUs is a complex methodology conceived by the 4th Committee which includes a weighted average and equal-weighted average blend of the rankings of three UK institutions: The Guardian University Guide, The Times Good University Guide and The Complete University Guide.

A problematic assumption underlies this methodology to discern the "quality" of law graduates: that good university education necessarily translates to a suitable skill set for legal practice. This conflation is belied by the fact that almost none of the factors considered by these university rankings gives any indication of how graduates from these universities would actually fare in the workplace.

For instance, the Guardian Guide's weightage of student prospects comprises only 15 per cent of the ranking. Other indicators include student satisfaction (5 per cent), expenditure per student (15 per cent), entry scores (15 per cent), students' perceptions of assessment and feedback (10 per cent).

Additionally, the qualitative argument does not extend to 10 Australian OSUs, which are de facto protected from delisting by virtue of Annex 4-III of the Singapore-Australia Free Trade Agreement. Global world university rankings rate at least three of these Australian universities below several of the eight universities under the gun.

The delisting seems to have taken the most important stakeholders impacted by this decision by surprise: students and alumni from the delisted universities. This is unfortunate. A more fundamental issue: Why the need for the OSU? In any case, why should the SILE be policing university quality standards?

University rankings are dynamic, fluctuate annually and are no predictor for suitability for legal practice. Moves to proscribe the eight universities will only take effect with the academic intake of 2016/2017, and the review after that which is due in another five years would leave today's list very outdated in the not too distant future.

The "quality" policing is a relatively recent phenomenon. The OSU system was introduced in 1994 on the recommendation of the 1st Committee on the Supply of Lawyers and reviewed subsequently.

Prior to the introduction of the OSU system, most UK law graduates from almost any university were able to be called to the Bar as long as they passed the bar exam.

In fact, as at November 1992, 1,750 law students were enrolled in the University of London external degrees, a figure which was estimated to be higher than the combined full time students in both NUS and overseas universities for the same period. This was a popular and affordable route for an aspiring lawyer to obtain his qualifications to be called to the Bar.

The rest of the sieving process was left to the free market and the rigours of practice. There are excellent senior lawyers from universities which are no longer on the list of OSUs. The leading authority of civil procedure in Singapore, Jeffrey Pinsler Senior Counsel, was a graduate of Liverpool University which is one of the eight being delisted.

Conversely, I have come across graduates from top universities who are aces in the exam hall, but who are completely devoid of the common sense, doggedness and ability to interact with clients that should be the hallmarks of a successful legal practitioner. The legal industry is a vocational, practical one where academic snobbery should have no place.

To maintain the standards of the legal profession, set high standards for admission to the Singapore Bar and let market forces do the rest. Concerns about vocational aptitude should be addressed by raising the difficulty of the Singapore Bar exam. The Bar exam, with a focus on the practical aspects of lawyering, is a much more proximate indicator of aptitude to practice.

Once aspiring lawyers pass the Bar, let employers have free rein to decide who to hire and from what types of educational backgrounds they prefer.

Maximise employer choice. Centralised micro-management is likely to fall foul of market forces. The free market has a habit of showing up the best intentions of central planning, as the present glut of lawyers attests to.

The writer is a director of Peter Low LLC. He is a graduate of the National University of Singapore and New York University

Source: Business Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Supply Bill (Bill 8 of 2015)

A snapshot of Singapore's derivatives reporting framework

Business
26 Feb 2015

Single Asean prospectus for cross-border listings

Business Times
04 Mar 2015
Pauline Ng

It aims to make the region an attractive fund-raising hub and give issuers from signatory states faster line to capital

[Kuala Lumpur] A STREAMLINED review framework (SRF) for a common Asean prospectus is expected to provide issuers more opportunities and quicker access to fund-raising across signatory countries, which will comprise Malaysia, Singapore and Thailand for a start.

The SRF is expected to enhance the region's attractiveness as a fund-raising centre; issuers planning to offer or list equity or plain-debt securities are assured of a shorter time-to-market and speedier access to capital across the signatory countries.

The framework is an initiative under the 22nd Asean Capital Markets Forum (ACMF) being held in Kuala Lumpur and hosted by Malaysia's Securities Commission (SC).

The SC, the Monetary Authority of Singapore (MAS), the Securities and Exchange Commission (SEC) of Thailand and the Singapore Exchange signed a memorandum of understanding to set up the SRF in Kuala Lumpur on Tuesday.

SC chairman Ranjit Ajit Singh said its key objective is to ensure a more seamless process for an issuer seeking listing in more than one ACMF signatory jurisdiction, thus reducing the time required to prepare for such multi-jurisdictional offerings. Once an issue is approved in a jurisdiction, it will be fast-tracked in other markets.

MAS' assistant managing director for the capital markets group Lee Boon Ngiap said the revised framework would provide "procedural enhancements"; Singapore Exchange chief executive Magnus Bocker said such an initiative was important for an increasing number of companies "as they are doing more and more Asean business".

The framework is targeted to be implemented by the third quarter of the year, when a handbook will be jointly issued, Mr Singh said. He added that Indonesia and the Philippines are expected to be signatories to the framework by the end of the year.

The ACMF, set up a decade ago to promote freer flow of capital and greater connectivity of Asean capital markets, has introduced other initiatives, including a regional trading link, a framework for expedited entry of secondary listings and the Asean disclosure standards.

At the Kuala Lumpur meeting, it also announced the authorisation of five funds as Qualifying Collective Investment Schemes (CIS) under the Asean Framework for CIS cross-border offerings, which was implemented last August.

Three of the schemes are MAS-approved, and the other two, SC-approved. A sixth is being reviewed by Thailand's SEC, said Mr Singh.

The ACMF is also developing a five-year action plan for the 2016-2020 period, and has opened a consultation process for it; when launched at the end of the year, it is expected to elucidate the region's vision of integration as well as its priority and focus areas.

btworld@sph.com.sg

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Protected Areas and Protected Places Act - Protected Places (Revocation) Order 2015 (S 108 of 2015)

IPOS Case Summary: Japan Tobacco v Philip Morris Products [2015] SGIPOS 4 (whether marks and goods similar that may lead to confusion)

Judgments
25 Feb 2015

Relook GST calculation for dutiable items: Case

Straits Times
04 Mar 2015
Christopher Tan

It wants tax computed on pre-duty price to avoid 'double taxation'

THE consumers' watchdog has called for a review of the way the goods and services tax (GST) is calculated for items that also attract duty.

Currently, products like petrol, cigarettes and cars have duty added to them before the GST is calculated.

However, the Consumers Association of Singapore (Case) would like to see tax calculated on the pre-duty price.

The Ministry of Finance claims the current practice is common in countries other than Singapore.

But Case believes it places an extra burden on customers.

"Imposing GST on the excise duty is tantamount to double taxation," Case executive director Seah Seng Choon said. "We have checked with the GST department and it said that if the excise duty is priced into the product, GST is payable. This is not only for cars and petrol - it applies to cigarettes and liquor as well.

"It is time the authorities looked into this issue. GST is to be imposed on goods and services - and tax is not goods and services."

As an example of the current system, assuming a litre of non-premium petrol has a wholesale price of 55 cents a litre and the oil company has a gross profit margin of 80 cents on the litre, the GST of 7 per cent at this point would work out to be 9.45 cents.

But if the GST is calculated after the petrol duty of 56 cents is added, the tax comes up to 13.37 cents - more than 40 per cent higher.

In dollar terms, the difference for cars is huge.

Assuming a vehicle has an open market value of $30,000, it should attract $2,100 in GST. But after the 20 per cent excise duty is applied, the car costs $36,000, and its GST becomes $2,520 - $420 more.

"Clearly, there is an anomaly here and there is a need for a correction," said Mr Seah.

"We shall be writing to the tax department to request for a review of this practice."

Case thinks that duty and the GST should be applied separately, so as to avoid having "tax on tax".

Motor Traders Association president Glenn Tan concurred, adding that the whole multi- layered car taxation scheme "should be reviewed".

Singapore Vehicle Traders Association president Neo Tiam Ting said it has also been calling for a review into the way the GST is applied to second-hand vehicles. It said the GST should be applied on net profit made by the used-car dealer, not gross profit.

"We last met them (the Finance Ministry) last month, and they still told us they could not accept our proposal," Mr Neo said.

The Ministry of Finance said the GST is "a tax on the final value of a good or service consumed in Singapore, which includes any duties imposed in the course of supplying this good or service".

It added: "Duties levied on petrol and cars are part of the final price payable for the consumption of petrol and cars.

"GST is thus payable on such duties... This is also the practice in other countries."

Explaining why the GST is not levied on a car's Additional Registration Fee or its certificate of entitlement premium, the ministry said these were "regulatory charges imposed by the Land Transport Authority on vehicle buyers".

christan@sph.com.sg

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 11) Notification 2015 (S 107 of 2015)

Commercial disputes – developments in 2014

Judgments
25 Feb 2015

Lorry driver gets 12 years in jail and caning for killing ex-lover in jealous fit

Straits Times
04 Mar 2015
Selina Lum

WHEN he saw his former girlfriend holding the arm of another man, 30-year-old Xiao Guiliang was filled with jealousy. He demanded that she return to his flat in Choa Chu Kang to remove her things.

But 24-year-old Zhang Jie did not leave the flat alive. An autopsy found 192 wounds and bruises on her head, neck, chest and limbs.

Yesterday, Xiao, who had major depressive disorder at the time, was sentenced by Justice Tay Yong Kwang to 12 years in jail and six strokes of the cane for killing Ms Zhang in July 2013.

Both were from China.

The lorry driver had originally been charged with murder, although this was reduced to culpable homicide because of his mental condition,

Deputy Public Prosecutor Chee Min Ping urged the court to jail Xiao for 10 to 12 years for the brutal way in which he inflicted multiple injuries on his former lover. She said he refused to accept that the relationship had failed and took out "his hurt feelings in a most depraved and selfish manner".

Ms Zhang had come to Singapore to study in 2007, while Xiao arrived in 2008 to work as a public bus driver. They first met online in late 2009, and were intimate the first time they met in person. The couple started living together in March 2011, but Xiao went back to his home town in July 2012 after losing his job.

He returned in September 2012 to accompany Ms Zhang for an abortion. After returning to China again, he came back here in November after getting a construction job.

In February 2013, she asked to end their relationship because her mother was against it. He agreed. But they continued to have sex and lived together in his flat for four months before she moved to a neighbouring block.

After midnight on July 7, 2013, seven days after she moved out, Xiao saw her with a man outside Yew Tee MRT station.

He confronted them, and remarked that she was quick to get a new boyfriend, and asked what his relationship with her was.

Xiao said he had been her boyfriend for the past 31/2 years. As Xiao and Ms Zhang walked back to their homes, he told her to collect her things from his flat. He called her several times to remind her.

Ms Zhang and her flatmate Liu Jie went to his flat at 2am.

As they walked into his bedroom, he pushed Ms Liu out and locked the door. Xiao started asking Ms Zhang about her new man. He pushed her onto the bed.

Afraid that Xiao would hurt her, she grabbed a knife from a side table, warning him not to come near her. Xiao wrested the weapon from her, and in the ensuing struggle, stabbed her repeatedly, almost severing her windpipe.

Ms Liu called the police when the door opened briefly and she saw Xiao's arms covered in blood and heard Ms Zhang groaning.

Xiao, who suffered slash wounds on his chest and hands, claimed that he drank insecticide to kill himself after stabbing Ms Zhang. But toxicology tests found alcohol, but no poisons, in his blood.

After his arrest, Xiao was found by a government psychiatrist to be suffering from a major depressive disorder with associated psychotic features.

This condition was likely caused by a head injury he suffered in 2010 when an automated carpark gantry fell on his head, said Dr Stephen Phang.

selinal@sph.com.sg

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Town Councils Act - Town Council of Sembawang (Conservancy and Service Charges) (Amendment) By-laws 2015 (S 106 of 2015)

MAS proposes changes to market misconduct offences, reverses Airocean’s legal holding

Business
25 Feb 2015

ADV: LexisNexis: Law and Practice of Corporate Insolvency

Singapore Law Watch
04 Mar 2015
LexisNexis

Goods and Services Tax Act - Goods and Services Tax (General) (Amendment) Regulations 2015 (S 105 of 2015)

Is protecting your customers’ data really that important?

Business
23 Feb 2015

Court throws out man's bid to get back $500k in 'love gifts' to mistress

Straits Times
03 Mar 2015
K.C. Vijayan

THE High Court threw out a Singaporean businessman's bid to recover "love gifts" allegedly worth $500,000 from his China-born mistress after their two-year affair soured.

The court found Mr Kua Tee Beng, 67, could not back his claim that he had been pressured to give her lavish gifts including a $40,000 cheque and $295,000 to help buy a condominium unit.

"(Mr Kua)'s evidence that the defendant threatened to tell his current wife about their relationship does not sit comfortably with (his) own behaviour over the course of the parties' two-year relationship," said Judicial Commissioner George Wei. "Given that (Mr Kua) is an independent and successful businessman, I find it hard to believe that he would so easily succumb to the pressure he alleges," he said in judgment grounds released yesterday.

Mr Kua had sued for the return of three Rolex watches worth $50,000 in total, jewellery valued at $30,000 and monthly allowances amounting to $85,000 allegedly given over two years from June 2011 to hairdressing salon owner Ye Caiyan, 41.

He also sought the return of $295,000 he had put down for an $808,000 three-room apartment in Hong San Walk in Choa Chu Kang registered in her name.

Madam Ye, a Fujian native who is now a Singapore citizen, has three school-going children with her Singaporean husband, from whom she is legally separated.

Mr Kua is twice married and has three children, aged between 38 and 44, with his first wife.

He first met Madam Ye in August 2010 through her nephew, a mechanic at his workshop. Some seven months later, they became involved and he started giving her expensive items and money.

Both gave "wildly conflicting" versions of why the relationship ended in 2013, noted the judge.

Mr Kua's lawyer Subbiah Pillai argued she had exerted undue influence to make him give her the various items and that the condo was actually being held by her in trust for him so his children could not fight over it.

But Madam Ye's lawyer Ramalingam Kasi countered the items, given in the "context of a loving and sexually intimate relationship" were non-returnable as they were "voluntarily given".

The judge found Mr Kua did not offer a "single shred of evidence" to show he gave her the jewellery or three Rolex watches, instead of only one Rolex.

Nor could Mr Kua prove he had been threatened by Madam Ye into supporting her for over two years, paying maintenance monthly and holiday bills for her and her children.

Mr Kua claimed that Madam Ye went to his motor workshop office frequently to badger and "create a scene" for payments but no witness was called to support this claim, noted the judge, who was also not convinced Mr Kua wanted to buy the property for himself given his "lack of involvement" in the purchase, among other things.

"I do not find it extraordinary or implausible that (Mr Kua) intended to benefit (Madam Ye) with the entire $295,000. This is perfectly understandable given that the parties were in an intimate relationship at that point."

vijayan@sph.com.sg

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To view the judgment, click <here>.

Revised Edition of the Laws Act - Revised Edition of the Laws (Industrial Relations Regulations) (Rectification) Order 2015 (S 104 of 2015)

MAS consults on changes to MAS Notices on submission of statistics and returns by banks and merchant banks

Business
23 Feb 2015

Rationale for axing law schools not convincing: Forum

Straits Times
03 Mar 2015

NATIONAL University of Singapore (NUS) law dean Simon Chesterman has suggested that the eight law schools dropped from the approved list are among the lower-ranked law schools in Britain and their graduates often find it harder to get jobs ("Shorter list of approved UK law schools welcomed"; last Thursday).

He then urged parents and students as follows: "Instead of spending tens of thousands of pounds on a law education at a lower-ranked school, they could be better off pursuing other degrees locally."

I have had the benefit of studying at NUS Law School, the Singapore Management University (SMU) Law School and Leicester Law School. I gained far more from my experience in a year in Leicester than I have in a year in the other two law schools.

It is not accurate to imply that graduates of the University of Leicester find it harder to get jobs. Recent alumni of the law school include at least one justice's law clerk and a leading investment banker. Several of us started our careers in top Singapore law firms, and most of us are now in offshore law firms, multinational corporations or financial institutions.

By narrowing the list of approved schools to high-cost areas of England like Oxford and London, the Singapore Institute of Legal Education has made the pursuit of an English law degree more expensive and a preserve of the rich. My parents had to sell their HDB home to send me to law school.

If the decision was made purely on rankings, the University of Bristol, which was ranked lower than the University of Southampton in the 2014 Guardian League Table for law schools, should have been struck off.

Many students choose to study law overseas because they desire to study law but are not able to secure a place in the local law schools. To suggest that they do something else is a fundamental failure to understand a person's motivation for studying law. Not all who choose to study law do it to become lawyers. This is a traditional mindset we should shift away from.

Stakeholders of the legal profession could have been better consulted before the recommendations were made. The eight law schools could also have been given an avenue to respond to the recommendations, rather than wait five years for the next review to take place.

Dharmendra Yadav

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Road Traffic Act - Road Traffic (Motor Vehicles, Construction and Use) (Amendment No. 2) Rules 2015 (S 103 of 2015)

MAS consults on draft amendments to Banking Act to strengthen supervisory oversight over banks

Legislation
23 Feb 2015

Aussie legal education more relevant: Forum

Straits Times
03 Mar 2015

THE removal of eight British universities from the approved list for admission into the Singapore Bar has, understandably, sparked protests ("Shorter list of approved UK law schools welcomed"; last Thursday).

Questions have been asked, in particular, as to why Australian universities were not similarly reviewed ("Some Aussie varsities 'rated lower', but were not delisted"; last Friday).

Many parents and prospective students may not realise that the legal education one gets from an Australian law school is likely to be more relevant than that from a British university.

Because of Britain's membership in the European Union, the British law course includes compulsory modules on EU law, which has little relevance for the Singapore practice.

At the same time, the British law course does not make modules such as company law compulsory, which is a significant handicap for the returning law graduate seeking Singapore qualification.

On top of that, even for the relevant modules taken, British law itself has diverged from common law (which forms part of Singapore law) in many respects.

There is more commonality between Singapore law and Australian law, than between Singapore law and British law, even for statute law.

The British course is also a three-year course, as compared with the four-year Australian course.

In other words, the UK law graduate may end up having taken far fewer relevant modules than the Australian graduate.

One of the reasons for the British universities' relative popularity is the very fact that they offer a three-year, and not a four-year course. However, at least one Australian university gives a one-year reduction for holders of the Law and Management Diploma from Temasek Polytechnic.

The Singapore Institute of Legal Education has also recently shifted the timing of the Part A Singapore law course (compulsory for all foreign law graduates) to be more suitable for the Australian graduation dates.

Thus, for parents and students who may not be confident of entry into the local law schools, it may not be a bad idea for them to consider the Temasek Polytechnic/Australian university route instead.

Josephine Chong (Ms)


Background Story

LET BAR EXAM BE DECIDING FACTOR

Anyone who wants a law degree should be able to get it. The solution to the glut of lawyers is the Bar exam. The Bar exam can be used as a quality control tool that helps to assess those who are likely to be suitable for practice. With this, everyone competes on a level playing field. This is also consistent with our meritocratic system. This should hopefully alleviate the unnecessary inferences drawn by some that the graduates of the delisted universities are inferior. If you are good enough, you will pass the Bar exam regardless of the university you graduated from.

- Livia Ong (Ms)

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Road Traffic Act - Road Traffic (Motor Vehicles, Test) (Amendment) Rules 2015 (S 102 of 2015)

MAS takes further steps to ease understanding of investment information for investors

Business
18 Feb 2015

Qualifying Certificate scheme: Time for review

Straits Times
03 Mar 2015
Melissa Tan

Developers have chosen to delist or sell units to a Singapore subsidiary rather than pay fees to hold onto unsold units in a down market

SOME property developers have turned to creative restructuring over the past few months to escape hefty penalties for their unsold private homes.

They have sold those homes to a subsidiary, or gone to the extent of delisting, in order to avoid those penalties.

Under the Residential Property Act, "foreign developers" must apply for Qualifying Certificates (QC) when they buy private residential land for development.

Foreign developers are defined as developers whose shareholders and directors are not all Singaporean. Listed companies are deemed foreign as they would have some foreign shareholders.

Once it obtains this certificate, the developer is bound by the QC rules. One of the rules gives a developer five years to complete a project and two more to sell all the units - or a total of seven years from the date it bought the land. It is not allowed to rent out unsold units.

If it fails to meet this deadline, it may have to forfeit a banker's guarantee worth 10 per cent of the land purchase price. Unsold units risk being force-sold by the Government.

By limiting foreign companies' holding period, the QC scheme was meant to prevent them from hoarding land or buying land for speculation in Singapore.

But it allows developers to pay an extension fee to get another three years to sell the units. The fee goes from 8 per cent of the purchase price for the first year to 16 per cent for the second year and 24 per cent for the third. Since land purchases are often in hundreds of millions of dollars, that adds up to a staggering sum.

Developers don't want to pay the high fees, but are also loath to slash prices further to move units in a lacklustre market. As a result, some have turned to creative ways to get out of the bind.

One is to delist, if it happens to be a listed company.

Mainboard-listed Popular Holdings declared in January that it wanted to delist to avoid QC penalties, which could cost it up to $99 million.

Another way for a foreign developer to solve the problem is to sell all the units in the development to a privately-held Singapore company. This buyer could be the foreign developer's privately held parent company or subsidiary.

The buyer of the units would have to pay an additional buyer's stamp duty of 15 per cent - this is the rate for companies - of the homes' purchase price.

One example is mainboard-listed Hiap Hoe, which launched a high-end condominium near Orchard Road in 2012 but failed to sell any units. Eventually, it sold the entire project to its privately-held parent company in December last year for about 15 per cent lower than the bulk sale's initial asking price in October 2013.

Before that, Hiap Hoe offloaded some luxury units in another project last year to a subsidiary to avoid having to pay any extension charges on its unsold units.

Since Hiap Hoe's private homes did get sold, albeit to a related company, Hiap Hoe would not have breached QC rules.

Such actions are legitimate and, of course, not cheap for the developer to undertake.

However, they do raise a fundamental question: Is such a move in line with the spirit of the QC policy? Developers first found out that they could escape QC penalties by delisting back in 2013. That was when luxury developer SC Global - the developer of ritzy projects such as The Marq on Paterson Hill - decided to delist from the mainboard.

SC Global's delisting was closely watched because the developer had many unsold luxury units. Market watchers had believed at the time that the QCs it had obtained for its existing private projects would still apply.

After it delisted, SC Global was considered a privately-held Singapore company, and therefore not required to follow QC rules.

SC Global applied later that year to the Singapore Land Authority (SLA) to get the QCs on all its projects cancelled, and succeeded. Freed from the seven-year rule, it could hold on to unsold units and not have to pay millions in extension charges.

Extending the sale deadline at its 66-unit The Marq on Paterson Hill for a mere six months, for instance, would have cost $5.5 million.

The SLA at that time explained that SC Global's QCs were cancelled because it had now become a Singapore company.

Although SC Global was the first case made public, the SLA disclosed that Soilbuild Group had delisted and got its QCs cancelled a few years earlier. Soilbuild delisted in 2010 and became a Singapore company, got its QCs for its private project cancelled, then re-listed in 2013.

The SLA's pivotal decision that foreign-turned-Singaporean developers could get their existing QCs cancelled surprised market watchers in 2013, and for good reason.

By doing so, the SLA effectively sent the signal that developers can list, and tap foreign funds to buy Singapore land. If the market is bullish, they can sell and pocket profits. If the market turns bearish, they can choose to delist, hold on to their units and avoid paying extension fees. This lets them avoid the full brunt of the consequences of their investment.

It also goes against the objective of the QC in the first place, which was to prevent foreign developers from hoarding land or projects.

To be sure, developers are not to blame for wanting to avoid QC penalties. Their actions to delist or sell units to a subsidiary make perfect sense, given the rules in place and the poor condition of the property market.

It is not too late, however, for regulators to review how they assess future applications for retroactive QC clearances, which would make for a fairer marketplace.

melissat@sph.com.sg

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Road Traffic Act - Road Traffic (Motor Vehicles, Construction and Use) (Amendment) Rules 2015 (S 101 of 2015)

SHC: Specificity in pleadings – When “I can’t remember” isn’t enough

Judgments
18 Feb 2015

Firms moving to meet minimum trading price rule

Straits Times
03 Mar 2015
Grace Leong

Some propose share consolidation to get share price up during grace period

A MAJOR change that kicks in next year, requiring mainboard-listed firms to have a minimum share trading price of 20 cents, has already sparked action on some corporate floors.

The new Minimum Trading Price (MTP) rule takes effect on March 1 next year. The 12-month countdown to it has begun.

The year's grace period gives firms time to get their six-month average share price above 20 cents.

The best way of doing that is through a share consolidation, which involves reducing the number of issued shares. Once that has been done, each investor will have his stake re-calibrated to reflect the new shareholding.

While almost 250 firms of 650 mainboard-listed stocks are trading below 20 cents, only nine so far have proposed consolidations - Top Global, Uni-Asia Holdings, Aztech Group, Global Testing Corp, Hotung Investment Holdings, Captii, SP Corp, Multi-Chem and CEI Contract Manufacturing.

More consolidation applications are expected as a number of companies that tend to have their annual general meetings (AGM) in coming months would want to also hold the required extraordinary general meeting (EGM) at the same time to save costs, corporate lawyer Robson Lee said.

Property developer Top Global is starting its consolidation exercise now so it can be ready by next March when the SGX will conduct its compliance review, a company spokesman said.

The firm said it decided to seek SGX approval early for the share consolidation circular so it can run it by shareholders at an EGM to be held at the same time as its upcoming AGM. "The share price will be based on the average trading price from Sept 1, 2015 through Feb 28, 2016," said a company spokesman.

The MTP process has a clearly defined timeline.

After the grace period ends on March 1 next year, those still below the 20-cent level will go on a watchlist for three years, during which their shares will be ineligible for investment under the Central Provident Fund (CPF) Investment Scheme. The move is aimed at safeguarding CPF members' savings.

Companies that still fail to comply by Feb 28, 2019, could be delisted or have the option to transfer to the Catalist board, where there will be no MTP.

There are other benefits in getting the process going such as SGX waiving the fees for MTP-related share consolidations for two years. Some firms may have to bear only legal fees.

NRA Capital executive chairman Kevin Scully noted that the decision to do a share consolidation is also driven by a company's business outlook.

Some firms may opt not to do a consolidation now as they expect robust earnings and their share price to rise above 20 cents before the rule takes effect, he said.

gleong@sph.com.sg

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Income Tax Act - Income Tax (Exemption of Certain Income of Prescribed Sovereign Fund Entities and Approved Foreign Government-Owned Entities) (Amendment) Regulations 2015 (S 100 of 2015)

MAS and SGX conduct second round of consultation on details for implementing policy proposals to facilitate bond offerings to retail investors

Business
18 Feb 2015

Flyover killing: Man gets 16 years' jail and 12 strokes

Straits Times
03 Mar 2015
Selina Lum

SEARCHING for his lost wallet in Little India, construction worker Raju Arivazhagen, 31, went up to a fellow Indian national and asked if he had seen it.

Unknown to Mr Raju, Periyasamy Devarajan had earlier picked up his wallet and thrown it away after taking the $20 and ez-link card inside.

But Periyasamy, 20, lied that he had seen the wallet at the Kampong Java flyover and led Mr Raju there, plotting to rob him at the secluded spot.

Under the flyover, Periyasamy viciously attacked the older and smaller man, bashing him in the face and head with a rock, a branch and three concrete slabs weighing 10.5kg to 13.8kg each.

Yesterday, Periyasamy, now 23, was sentenced to 16 years' jail and 12 strokes of the cane after he pleaded guilty to culpable homicide for killing Mr Raju three years ago.

He originally faced a murder charge, but it was reduced. No reason was given in court.

The High Court heard how the two strangers crossed paths hours after they went to Little India on Feb 7, 2012, which was the day of Thaipusam. Mr Raju had gone there with friends for drinks after visiting temples to observe the Hindu festival.

He boarded a taxi in the wee hours to return to his dormitory but alighted after realising he had dropped his wallet.

Periyasamy had gone to Tekka Market for drinks with his brother.

Although employed by a scaffolding company, he had stopped turning up for work since Jan 21 and was in financial difficulties.

Periyasamy saw Mr Raju's wallet as he was walking to a field at the junction of Hampshire Road and Northumberland Road.

Some time later, Periyasamy lied to Mr Raju that he had seen his black wallet at the flyover.

There, Periyasamy struck Mr Raju repeatedly until he stopped moving. Periyasamy then fled with Mr Raju's mobile phone.

Police nabbed him on Feb 12 after establishing his identity through intelligence and surveillance footage from the Little India MRT station and the Tanglin Police Divisional Headquarters, which is a three-minute walk from the flyover.

Two weeks after his arrest, Periyasamy assaulted a police officer when taken to the crime scene. A charge of hurting the officer and two unrelated charges of misappropriating mobile phones were considered during sentencing.

Deputy Public Prosecutor April Phang asked for at least 16 years' jail and 10 strokes of the cane, pointing to the viciousness of the attack by Periyasamy.

Periyasamy's lawyer, Mr Sunil Sudheesan, asked for 10 to 12 years, noting that his client was immature at the time but has since learnt his lesson.

selinal@sph.com.sg

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Goods and Services Tax Act - Goods and Services Tax (Application of Customs Act) (Provisions on Trials, Proceedings, Offences and Penalties) (Amendment) Order 2015 (S 99 of 2015)

Singapore High Court holds that the Riddick principle ceases to apply once a document has been used in open court

Judgments
17 Feb 2015

Legal eagle never too busy for his passions

Straits Times
02 Mar 2015
Wong Wei Han

Managing partner of top law firm relishes his role in the arts scene

MOST people would probably feel exhausted merely looking at Mr Philip Jeyaretnam's typically packed schedule.

Most days, the renowned lawyer - and acclaimed author - races from meetings and case-preparation sessions to court hearings often lasting a full day. His evenings are spent on conference calls with clients.

But Mr Jeyaretnam, managing partner of Rodyk & Davidson, would not have it any other way.

"I don't know if this is a good or bad thing - but I'm really addicted to my work, and I love to be surrounded by people who love their jobs," he said.

"The legal profession is probably not the best career for people who complain that they have too much work or too little time."

At the age of 50 - which he believes to be the peak of his life - he is relishing the myriad roles he plays as head of one of Singapore's top law firms, a highly-sought-after commercial litigator and international arbitration counsel, as well as the new board chairman of the School of the Arts (Sota) since Jan 31.

His initial plans for Singapore's first pre-tertiary arts school will draw on his lifelong passion for literature and creative writing.

But he insists his first priority is still law and he expects Rodyk to grow further.

He said: "With the internationalisation of trade and investment, Singapore's status as the seat of choice for cross-border dispute resolution in Asia is stronger than ever. To quantify, volume of such cases has almost tripled in the past eight years."

In terms of staff strength, since he became managing partner in 2011, Rodyk has grown some 40 per cent to a team of over 200 lawyers across practices including commercial arbitration, as well as corporate and financial services.

It has an office in Shanghai and an associated office in Jakarta.

"Our business growth would be roughly comparable to the headcount rise that we've had, and I expect another 15 to 20 per cent increase in headcount in the next three years," he said.

"My job is to spot trends in the market, and also help my partners to look at new areas. There are many changes in the market and we need to be organised to respond effectively.

"Often, that means cajoling someone to get out of their comfort zone and be ready to do something new or different as the world changes.

"We are a service provider in a very competitive international market, and we cannot afford to stand still."

Mr Jeyaretnam remains every bit as active in the front line despite having managerial duties at Rodyk. The Cambridge-trained lawyer looked pleased as he recounted last year's actions.

"Last year, I spent around 80 to 90 days in court hearings. For every hearing day, you typically need twice as much time for preparation. In the past two years, I've also represented clients in arbitrations in London and Zurich.

"As you can imagine, my workload is tiring. But this is the time of my life, really.

"I'm right at the best age for a man - certainly for a lawyer. At 50, you're wiser, I hope, you see things faster because you've been around the block enough, and you're still full of energy."

But for all that he has achieved in the legal industry so far, "Philip Jeyaretnam" is a name equally well known as a key figure in Singapore's art scene.

His appointment as Sota board chairman is just the latest chapter of his artistic pursuits that began when his short story, Campfire, won a national award in 1983.

Since then, writing in his spare time, he has released three critically acclaimed novels and still produces short stories regularly.

His latest, Moonshine In Singapore, is close to being finished and will be published this year as part of a collection with an SG50 theme.

As he takes up his new role at Sota, he hopes he can help spread the passion for writing to more young Singaporeans.

"One thing I'm keen to explore is how to make creative writing and storytelling a key part of the Sota student experience. Storytelling is the foundation of all arts - and Singapore needs more storytellers.

"One thing I try to do at Rodyk, and in my other endeavours such as at Sota, or as a trustee of Singapore University of Technology and Design, is to help young people make the most of their lives.

"Whether it is helping shape an institution, or it is speaking directly to an individual, it's all about bringing to bear a perspective that might help guide others as they learn and grow."

He also sees Sota becoming part of a wider national effort to promote a vibrant arts scene here, one of the key intangibles a global city must have, he added.

Between Sota, Rodyk and his role as chairman of the Singapore Writers Festival steering committee since 2007, he knows what it is like to be extremely busy. But he shrugged off the notion that he may not have the time to juggle the law and the arts.

"The key is to schedule your time. When I set aside two hours after church on Sunday to write, I do exactly that.

"That's really the essence of things. Because there are so many hours in a day, so many hours in our lives - there is always time for all the different things you want to do."

Despite having a relatively high public profile, he prefers to keep his family life private.

The father of three teenage children declined to say much about his family, except to express his hope that his children will find fulfilment in whatever interests they pursue. As he has done.

whwong@sph.com.sg


Background Story

ADDICTED TO WORK

I don't know if this is a good or bad thing - but I'm really addicted to my work, and I love to be surrounded by people who love their jobs. The legal profession is probably not the best career for people who complain that they have too much work or too little time.

- Mr Philip Jeyaretnam, who spent around 80 to 90 days in court hearings last year, despite having managerial duties at Rodyk & Davidson

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 10) Notification 2015 (S 98 of 2015)

SHC considers diametrically opposed interpretations of sub-lease agreement in granting landlord’s claim against tenant for wrongful possession of premises

Judgments
17 Feb 2015

SGX minimum-trading-price rule kicks in

Straits Times
02 Mar 2015
Grace Leong

Affected firms have one year to bring share price above 20 cents

THE Singapore Exchange's (SGX) contentious new rule setting a minimum trading price (MTP) of 20 cents for mainboard-listed companies is on the books from today.

Even though this was flagged last August, few affected firms - with share prices under 20 cents - appear to have taken steps so far to address their position.

But they have a year's grace - until March 1, 2016 - to get their six-month average share price above 20 cents.

The new rule is aimed at curbing speculation and market manipulation here. Today, almost 250 out of 650 mainboard-listed stocks are trading below 20 cents.

After the grace period, those still below that level will go on a watchlist for three years, during which their shares will not be eligible for investment under the Central Provident Fund Investment Scheme. The CPF announced this move, aimed at safeguarding members' CPF savings, on Feb 10.

Meanwhile, companies that fail to comply with the MTP by Feb 28, 2019, could be delisted or have the option to transfer to the Catalist board, where there is no MTP.

The number of companies trading at 20 cents or below appears to have increased from about 220 when the rule was announced last August. Most indicated then that they would consider share consolidation, transfers to the Catalist board, or other corporate actions.

So far, only a handful have proposed share consolidations to shareholders, and all in the three weeks prior to yesterday's launch, according to SGX's website. They include Top Global, Aztech Group, Global Testing Corp, Hotung Investment Holdings, Captii, and CEI Contract Manufacturing.

"Some are still adopting a wait-and-see, and holding out for market forces to push their share prices above 20 cents," remisier Alvin Yong said. "Those trading below two to four cents will definitely do share consolidations if they want to remain listed."

Share consolidation props up the share price by reducing the number of shares in the market, he said. "If you own 100,000 shares of a company that's trading at 10 cents apiece, after consolidation to a 10:1 ratio, 10 shares will become one share. The new shareholding will be 10,000 shares and the new theoretical trading price will be $1."

"But share consolidation doesn't guarantee that stocks will stay above 20 cents. Prices are determined by market forces and the company's fundamentals."

Having more than a third of mainboard stocks trading below 20 cents has led to the Singapore market being labelled a "penny" market, or seen as lacking quality, which could hamper capital-raising efforts. SGX has said higher-priced shares tend to have better liquidity and are less susceptible to manipulation.

But critics of the rule say such regulations are unnecessary and impede trading activity.

Already, the number of companies with share prices below 20 cents has grown partly because investors and traders have been shunning such stocks, Mr Yong said. That, combined with the latest CPF move, will likely affect liquidity and further dampen share prices of such companies.

Mr Tan Choon Wee, president of the Small and Middle Capitalisation Companies Association (SMCCA), said he believes the move will increase issuers' cost of listing and confuse shareholders, as they have to recalculate the value of their holdings.

"Further, there will be many instances where investors will be left with odd lots, even with the lot size adjusted down to 100 shares, and have to incur costs to manage such lots," he said. "Another potential scenario is the share price keeps falling (despite) share consolidation, triggering the next round of consolidation."

gleong@sph.com.sg

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Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 9) Notification 2015 (S 97 of 2015)

Administering the discretionary death penalty in murder: PP v Kho Jabing [2015] SGCA 1

SLW Commentary
17 Feb 2015

Sham marriages: 30 middlemen convicted in 2 years

Straits Times
01 Mar 2015
Theresa Tan

Three dozen middlemen who arranged sham marriages to help foreigners extend their stay here have been convicted in the past two years, as the authorities continue to crack down on marriages of convenience.

The Immigration and Checkpoints Authority (ICA) told The Sunday Times that the go-betweens are mostly solo operators who earn between $3,000 and $5,000 for every sham marriage they arrange.

They include Singaporeans and foreigners, both men and women, and they tend to be in low-wage jobs such as cleaners.

In 2012, it became a criminal offence to arrange or enter into a sham marriage, as more foreigners were found doing so.

In 2013, 284 people were found guilty of being involved in sham marriages. Last year, 170 people were convicted. The figures include the couples in false unions as well as the middle- men.

Asked about last year's lower figure, the ICA spokesman said: "The new law could have had a deterrent effect."

Lawyers say the foreigners seeking bogus spouses are usually Chinese and Vietnamese women, some of whom are involved in the vice trade here. Male Indian nationals seeking jobs here are also known to be involved.

The Sunday Times understands that these foreigners often come to Singapore as tourists and enter into a marriage of convenience in order to stay here for much longer. No sex is involved and the couple do not live together after getting married.

From the cases dealt with in court, the foreigners pay the middlemen up to $26,000 to get a Singaporean spouse. The Singaporean spouses are usually paid between $2,000 and $5,000.

Some of the Singaporeans also receive a few hundred dollars each time their foreign spouses get a visa extension, said lawyer Kertar Singh.

Lawyer Josephus Tan suspects that syndicates are often involved in these shams, as a host of people here and overseas are involved in linking the couples. But he also felt that the recent law with its tough penalties has had a deterrent effect.

Before the law was passed, those suspected of being involved in a sham marriage could be charged only with giving false information to the authorities, an offence carrying a penalty of up to one year in jail, a fine of up to $4,000, or both.

Under the new law, the culprits face up to 10 years' jail or a fine of up to $10,000, or both.

Some of the middlemen caught have married foreigners for money themselves, although this is not common, the ICA spokesman said.

Singaporean Vickneswari Pillai Rajoo, 41, a jobless woman, married an Indian national for $2,000 in 2013 as she was in financial difficulty.

She later arranged for jobless Singaporean Melisa Sue Annylou Dass Maniam, 33, to marry Indian national Jatinder Singh, 23, who wanted to find work here.

Melisa was paid $2,000 but Vickneswari received only $200 for her part.

Vickneswari was sentenced to nine months' jail last year. Melisa received a six-month term and Jatinder, six months and six weeks.

"The ICA takes a tough stance and prosecutes errant couples and middlemen trying to circumvent our system by engaging in marriages of convenience to obtain immigration facilities, such as long-term passes and permanent residence, in Singapore," said the spokesman.

Members of the public can report suspected cases by calling the ICA on 1800-391-6150.

theresat@sph.com.sg


Background Story

OFFERED UP TO $3,000 FOR FAKE UNION

Singaporean Mohamed Ja'ali Ja'affar Shadik, 26, offered up to $3,000 to Singaporeans prepared to help foreigners live here by marrying them.

There would be no sex involved and the couple would not even have to live together after their sham marriage.

Mohamed Ja'ali, a part-time mover, made money too, pocketing $12,200 from three sham unions.

He arranged for the Singaporeans - two women and a man - to marry Indian nationals.

One of the foreigners, Bikramjit Singh, 31, was a waiter hoping to work here.

While still in India, he was told that he could improve his chances of getting a work permit if he married a Singaporean.

A fellow Indian introduced him to a man known only as Ali, Mohamed Ja'ali's accomplice. Bikramjit paid $13,000 to have a sham marriage arranged and was introduced to Nur Adilah Fitriah Rosli, 24, a Singaporean cleaning supervisor.

They registered their marriage in 2013.

Nur Adilah was promised $3,000 by Mohamed Ja'ali, but was only paid $800 after the marriage was solemnised. It is not known what happened to the remaining $2,200.

In 2013, Mohamed Ja'ali was sentenced to nine months' jail, while Nur Adilah and Bikramjit were each sentenced to six months' jail.

The Immigration and Checkpoints Authority is investigating Ali. Its spokesman said Mohamed Ja'ali was not part of a syndicate.

Theresa Tan

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Legal Profession Act - Legal Profession (Mandatory Reporting of Specified Pro Bono Services) Rules 2015 (S 96 of 2015)

Latest developments: Construction; employment

Judgments
16 Feb 2015

Delisted British law schools express disappointment

Straits Times
28 Feb 2015
Amelia Teng

They defend quality of their degrees, will work towards reinstatement

MOST of the eight British universities which have been removed from Singapore's pool of accredited law schools have expressed their disappointment.

Responding to queries from The Straits Times, they maintained that their law degrees are of high quality, questioned the criteria used to delist them, and added that they will work towards being reinstated in the next review.

On Tuesday, the Ministry of Law (MinLaw) cut the number of British law schools whose students can be admitted to the Singapore Bar from 19 to 11, weeding out those which are believed to have fared poorly in certain rankings. The changes will affect only next year's intake, and not students already studying there.

It explained that the move was "to ensure the continued high quality of overseas-trained entrants to the Singapore Bar".

Except for the School of Oriental and African Studies, University of London, the other seven delisted law schools - the University of Exeter, University of Leeds, University of Leicester, University of Liverpool, University of Manchester, University of Sheffield, and University of Southampton - all sent e-mail to The Straits Times responding to the Government's decision.

Professor Alastair Mullis, head of the University of Leeds' law school, expressed the sadness that after four decades, "we will soon have no Singaporean students".

He described Leeds as one of Britain's leading law schools, pointing to how it recently was ranked eighth out of 67 universities in the Research Excellence Framework, which released its report last December.

"We are convinced that, at the time of the next review, Leeds will present the Sile with a formidable case for re-accreditation."

The Singapore Institute of Legal Education (Sile), after accepting recommendations from the 4th Committee on the Supply of Lawyers, said in 2013 that it will review the list of approved law schools every five years.

A University of Liverpool spokesman highlighted its "awardwinning" law clinic, run by final-year students, and pointed out that its criminology and security honours degree programme is offered at the Singapore Institute of Technology.

The director of the University of Leicester International Office, Ms Suzanne Alexander, described the school as ranked among the top 20 British universities, and among the top 1 per cent in the world.

She also said that the school, which admitted 49 Singaporean law students between 2012 and last year, continues to have a law exchange programme with the Singapore Management University. She added: "We are naturally very disappointed by the outcome of the Sile review."

A spokesman for the University of Exeter, where there are 110 Singaporean law students, said it is strengthening its law curriculum and is "confident" that it will have a strong case for reinstatement in the future.

Professor Tamara Hervey, head of the University of Sheffield's law school, also expressed similar confidence.

A spokesman for the University of Manchester, which has 98 Singaporean law undergraduates, said it will continue to offer them the "highest quality teaching".

The National University of Singapore's law faculty has an exchange programme with the University of Manchester and said it has no plans to change this.

Some of the universities, such as Leeds, said they were holding dialogues with their Singaporean students to address their concerns over the delisting.

Professor Hazel Biggs, head of the University of Southampton's law school, which takes in 10 to 20 Singaporean students each year, said it is "working closely with our current students to provide the best possible advice and guidance".

Mr Airell Ang, 27, a second- year law student at the University of Liverpool, said that graduates from the eight schools may now find it even harder to get a six- month practice training contract at a law firm - a requirement for the Bar - when they return.

"But I remain optimistic that employers will not look at the school we come from, and our image will not be tainted."

ateng@sph.com.sg

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Town Councils Act - Town Council of Potong Pasir (Conservancy and Service Charges) (Amendment) By-laws 2015 (S 95 of 2015)

SCA: Exchange of information with foreign tax authorities

Judgments
16 Feb 2015

Landmark decision on death penalty sparks legal debate

Straits Times
28 Feb 2015
K.C. Vijayan

Law fraternity discusses first case before apex court after rule change

WHEN it comes to a murderer, how brutal must he be to warrant the death penalty?

In a landmark decision last month, judges were divided on this point - deciding in the end by three to two that convicted killer Kho Jabing, 31, will hang.

The decision sparked keen discussion among the legal fraternity, who noted that while it did provide some guidelines on when the death penalty should be upheld, these may not be enough.

Kho's was the first murder case to reach the Court of Appeal since new laws kicked in two years ago, giving judges more sentencing discretion for murder and drug-trafficking offences, as an alternative to mandatory hanging.

In 2008, Kho, a Sarawakian rag-and-bone man, bludgeoned a construction worker repeatedly with a branch while trying to rob him.

The decision of the nation's highest court last month hinged on what three of the judges said was the "sheer savagery and brutality" Kho had displayed. In essence, the act "outraged the feelings of the community", which justified the death penalty.

The two dissenting judges, however, were not convinced there was enough evidence to conclude beyond a reasonable doubt that Kho had struck the victim three or more times, or with such force as to cause the man's fatal skull fractures.

Said Singapore Management University don Chandra Mohan, a former district judge, writing in a law blog: "As the dissenting judgments have demonstrated, differences in the findings of facts as to whether the accused had shown a blatant disregard for life, the manner in which he had done so, and considerations of the relevance of the 'other circumstances' could well lead to inconsistencies in sentencing.

"Hopefully, future judgments of the Appeals Court will help to curb such inconsistencies."

Law graduate Grace Morgan argued in daily legal news service Singapore Law Watch that the court's assertion that the killer's brutal acts "outraged the feelings of the community" raised the question of what kind of outrage was needed to warrant the death penalty. Ms Morgan, who is a pupil at law firm Rodyk and Davidson, said it would be difficult to decide whether, for instance, three blows by the accused would cause enough outrage, rather than two.

A more precise alternative could be whether the offender acted in such a way that it "shocks the conscience", she suggested. A killer who cuts up his victim's body could be one such example.

She argued this would pitch the standard slightly higher than the current test, and would lessen some of the difficulties involved in trying to find the "precise level of moral culpability in borderline cases such as this (Kho Jabing) case".

Criminal lawyer James Masih pointed out that the court's decision was based on the facts of one particular case, and that each case was different. The law would become clearer as more rulings were made, he said.

Ultimately, though, there would be no hard and fast rules as each decision would depend on the facts of a particular case.

Said Associate Professor Mohan: "Unfortunately, the devil may still lie in the details."

Kho's lawyer Anand Nalachandran is currently preparing his appeal for clemency to the President.

vijayan@sph.com.sg


Background Story

DEVIL IS IN THE DETAILS

As the dissenting judgments have demonstrated, differences in the findings of facts as to whether the accused had shown a blatant disregard for life, the manner in which he had done so, and considerations of the relevance of the 'other circumstances' could well lead to inconsistencies in sentencing... Hopefully, future judgments of the Appeals Court will help to curb such inconsistencies.

Singapore Management University don Chandra Mohan, a former district judge, writing in a law blog

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Road Traffic Act - Road Traffic (Car Pools) (Exemption) Order 2015 (S 94 of 2015)

Singapore's Health Sciences Authority streamlines regulations of "therapeutic products" with proposed changes to the Health Products Act

Business
16 Feb 2015

Owner of top-of-the-line BMW loses suit over alleged defects

Straits Times
28 Feb 2015
Selina Lum

A REGIONAL sales manager who sued BMW agent Performance Motors over numerous alleged defects in a $387,100 model, has lost his High Court lawsuit seeking a new car and a refund.

Instead, Mr Chan Chee Kien - the first customer to buy the top-of-the-line 550i from Performance Motors - has to pay the agent $4,700 in storage charges, as it won its countersuit against him for refusing to collect the car from its workshop.

In a 61-page judgment released yesterday dismissing Mr Chan's suit, Justice Chan Seng Onn described his own observations when taken on a test drive for the plaintiff to demonstrate his noise complaints. The judge said he had to strain his ears to detect the "very faint" sound produced when the car went over a hump of a certain shape at a particular speed. "If it was not specifically pointed out to me, I would not have noticed it at all," he said.

The judge rejected Mr Chan's claim that a sales consultant had made fraudulent misrepresentations about the quality and performance of the car to mislead him into buying it.

The judge also rejected his claim that Performance Motors had breached conditions under the Sale of Goods Act. He accepted that the agent had satisfactorily repaired genuine defects without cost to the customer.

Justice Chan said: "I have some sympathy for the plaintiff as he bought an expensive car and he naturally had very high expectations of the level of quietness, comfort and pleasure he should have in driving it.

"It did not meet his subjectively high standards. But that is not the test to determine if he is entitled to reject the car and claim the return of the purchase price."

In May 2010, Mr Chan decided to buy the 550i even though Performance Motors had not brought in the model and did not have a car for him to view or test drive.

He took delivery of the car in August 2010. But from October, he complained of various problems, including a "helicopter-like" sound emanating from the undercarriage when the gear was in "drive" or "reverse" mode.

Over the next 15 months, the car was sent for repair seven times, spending 354 days in the workshop.

But Justice Chan found that the bulk of the 354 days in the workshop was because of Mr Chan's refusal to collect the car, with 72 days spent on troubleshooting and 17 days for actual repair work.

In his suit, Mr Chan listed 16 specific oral representations allegedly made by the sales consultant.

But the judge did not believe that he could recall specific representations "with such incredible detail". He noted that Mr Chan, who had previously bought three other BMWs, was a fairly sophisticated customer who would not rely on sales hyperbole.

Out of at least 30 complaints made by Mr Chan, the judge determined that 18 were not defects and that the other 12 defects had been successfully rectified.

selinal@sph.com.sg

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Terrorism (Suppression of Financing) Act - Terrorism (Suppression of Financing) Act (Amendment of First Schedule) Order 2015 (S 93 of 2015)

SCA finds respondent held trade marks for “Ku De Ta” on express trust for appellants

Judgments
16 Feb 2015

Ex-counsellor's case against Prisons thrown out

Straits Times
28 Feb 2015
K.C. Vijayan

He claimed his right to promote Sikh faith was violated

THE High Court has struck out a former volunteer prison counsellor's claim that the prison authorities violated his right to promote the Sikh religion in jails, pointing out that he had no standing to bring the challenge.

Justice Quentin Loh found Mr Madan Mohan Singh, 62, did not have a personal right because the prison is a restricted, enclosed security zone that a person ordinarily would have no access to, let alone promote his faith there.

Mr Singh had served with the prisons department as a volunteer Sikh religious counsellor from 2000 to December 2011, when his volunteer pass was not renewed.

This was after a probe in 2011 found that he had actively encouraged Sikh inmates to challenge the hair-grooming policy by making requests to keep their hair and beard unshorn in prison.

In January last year, Mr Singh sought a court declaration that the Singapore Prison Service breached his right to promote the Sikh religion among Sikh inmates.

In judgment grounds released on Thursday, Justice Loh held that Mr Singh had to show an "actual or arguable" breach of his constitutional rights before standing can be established.

"This is to prevent 'mere busybodies', whose rights are unaffected from being granted standing to launch unmeritorious challenges," the judge said.

The prisons department has a policy where Sikh inmates with unshorn hair and beards, when admitted, are allowed to remain so during their jail term.

But those who profess to practise the Sikh religion are not allowed to keep their beards or hair unshorn if they were admitted with hair or beard shorn by their choice.

The policy has been in practice for about 40 years. Prisons found Mr Singh's alleged actions to be a serious threat to the discipline, security, safety and order of the prison, noted Justice Loh.

Mr Singh's lawyer, Mr M. Ravi, had argued that the policy breached the right of Sikh inmates to practise their religion and this led to a violation of his right to propagate his religion, among other things.

The judge found that Mr Singh's arguments were "misplaced" as there was no logical link between the hair-grooming policy and the non-renewal of Mr Singh's volunteer pass to counsel in prisons.

He said the renewal of his volunteer pass depended on Prisons' assessment of his suitability and compliance with prison rules and regulations, among other things.

Quashing the substance of the hair-grooming policy would in "no way lead to the renewal of (his) volunteer pass and thereby vindicate his alleged right to propagate to the Sikh inmates".

Justice Loh made it clear Mr Singh is not an inmate and the hair-grooming policy did not apply to him. "This is obviously not a right that is personal to (Mr Singh) and he has no standing to pursue the issue."

Mr Singh's application to quash the labelling of prisoners as practising or non-practising Sikhs by Prisons also failed "to get off the ground", said Justice Loh.

This is because Prisons dropped the terminology in 2013 and used the terms "shorn" and "unshorn" to differentiate between Sikh inmates for the purposes of the hair-grooming policy.

The judge noted that two dialogue sessions were held between the Sikh Welfare Council, the Sikh Advisory Board, and Prisons and Ministry of Home Affairs officials in 2013.

During those sessions, the authorities reviewed the policy and said it was inappropriate to allow Sikh inmates with shorn hair to be given the same concession as Sikh inmates admitted to prisons with unshorn hair.

Mr Singh, a sports shop owner, said he would be filing an appeal. He acknowledged that this was a "sensitive case".

vijayan@sph.com.sg

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

To view the judgment, click <here>.

Planning Act - Planning (Development Charges) (Amendment) Rules 2015 (S 92 of 2015)

Changes to CPF contribution rates from 1 January 2015

Business
16 Feb 2015

Kannan Ramesh named judicial commissioner

Straits Times
28 Feb 2015

SENIOR counsel Kannan Ramesh has been appointed a judicial commissioner of the High Court.

The 49-year-old will serve for a term of two years with effect from May 22, the Prime Minister's Office announced yesterday.

Judicial commissioners have the same powers and functions as Supreme Court judges, but are appointed for a specific period.

The position was introduced in 1986 to get senior lawyers, in private practice, on the Bench to help clear the backlog of Supreme Court cases.

Mr Ramesh, a father of one, specialises in dispute resolution, insolvency and restructuring, as well as international arbitration.

He is the managing partner of Tan Kok Quan Partnership, but will step down from the position. He recently represented church finance manager Sharon Tan in the City Harvest trial.

He will also step down from other positions, including being a member of the Singapore Academy of Law's Law Reform Committee and M1's board.

He said: "It is a privilege and an honour to be asked to serve. This is the beginning of a new and exciting chapter in an institution which I have always held in the highest regard. I look forward to contributing and making a difference."

He graduated with a Bachelor of Laws degree from the National University of Singapore in 1990.

He was appointed a senior counsel - which recognises the best and most skilful advocates in the legal profession - in 2012.

With his appointment, the Supreme Court will have 13 judges, 10 judicial commissioners and five senior judges.

 

LIM YI HAN

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Town Councils Act - Town Council of Nee Soon (Conservancy and Service Charges) (Amendment) By-laws 2015 (S 91 of 2015)

Singapore plans to step up anti-corruption measures

Business
12 Feb 2015

Timely for S'pore to look into 'Internet neutrality' rules

Straits Times
28 Feb 2015
Irene Tham

ON THURSDAY, the five-member Federal Communications Commission (FCC) in the United States voted in favour of the toughest rules yet to protect a "neutral Internet", potentially setting the stage for further global reforms.

The new safeguards are meant to ensure that every content provider on the Web is treated equally by Internet service providers (ISPs).

For instance, ISPs that carry and deliver online content to end-users cannot create "fast lanes" for content providers that pay extra for prioritisation. Also prohibited are the blocking and "throttling", or slowing down, of lawful content and services.

The rules will apply to mobile-phone Web access as well.

The groundbreaking decision has put the US ahead of many nations in ensuring that the Internet will remain open to innovation, by not discriminating against poor start-ups.

So far, only Brazil, Chile and the Netherlands have introduced similar "Net neutrality" legislation. Specifically, these laws protect consumers from having to pay varying fees to ISPs and mobile operators for accessing services online.

They help preserve the original intent behind the public Internet, created in the mid-1990s.

ISPs, or "carriers" in tech-speak, were meant to carry all legitimate content impartially to end-users. End-users, or customers, do pay fees based on the speed of the links they use for access. However, ISPs are not supposed to charge companies more for prioritising their data. For example, they cannot charge YouTube extra for putting its videos on faster lanes to reach customers.

Without "neutrality", consumers could end up having to pay more to access the Internet. ISPs could, say, package services sold to consumers and charge different fees. A basic service would give access to just e-mail and social networks. "Premium" might let consumers stream videos and music, while "Super Premium" would allow downloads.

Brazilian law professor Ronaldo Lemo reportedly said: "Today, that sounds like an aberration but, without Net neutrality, it's a possibility."

Singapore's position

IN SINGAPORE, carriers can sell fast lanes to content providers.

The Infocomm Development Authority (IDA) requires ISPs to ensure that user access to legitimate websites does not slow down to the point where online services become "unusable". However, it does not ban throttling outright, which means ISPs have the option of slowing access to some websites, without rendering them unusable.

IDA also imposes minimum service-quality standards such as 99.9 per cent network uptime, and requires ISPs to publish typical surfing speeds for their networks during peak times.

Given the FCC's stand, it would be timely for Singapore to review some rules. It would also be apt in view of comments made in February last year by Singtel chief Chua Sock Koong at the Mobile World Congress in Barcelona. She said regulators should let carriers charge major Internet content providers for consumers to have faster access to their content. This means, for instance, charging Google, WhatsApp or local content providers to speed up their content to customers.

The comments sparked criticism from netizens.

A review is also called for because many of Singapore's existing broadband rules were set quite a while ago. Technological advances now allow ISPs to pinpoint what websites people go to. Previously, they could identify traffic only by type, whether it consisted of video or still images. Thus, the ability to sell fast lanes to online content owners is a recent development. In a high-profile deal in February last year, video streaming operator Netflix agreed to pay a fee to American ISP Comcast so its videos could travel on fast lanes to customers.

Contention over fast lanes

SOME see nothing wrong with carriers selling fast lanes to giant bandwidth gobblers such as Netflix and YouTube. These sites require a fatter "pipe" - which is more costly for carriers - for smooth video streaming.

After all, as Ms Chua argued, content companies are making profits from using carriers' infrastructure to reach customers, but not paying for it. Content companies such as Skype and WhatsApp have also eaten into carriers' voice and messaging revenues.

However, proponents of a neutral Internet feel that carriers are already making money from consumers, who pay more for higher-speed broadband plans. Carriers should thus deliver all content without discrimination.

There is also a potential conflict of interest as some carriers are content players too. Singtel last month announced a new video-streaming service called Hooq for the Asian market. As Mr Benjamin Tan, managing director of local ISP SuperInternet, put it: "What is to stop a telco from picking on providers that compete with it for business, thus stifling innovation?"

Contention over throttling

THIS issue also raises debate. ISPs can slow down certain online services, but IDA's current rule does not define the minimum "usable" standard. For instance, is it acceptable for an Internet user to be interrupted for five seconds multiple times during a 45-minute video stream?

Digital media lawyer Matt Pollins, an associate with Olswang, does not expect regulations in Singapore in the near future to go as far as those passed by the FCC. Still, he said, IDA's position could come under intense scrutiny in one to two years.

"Singapore is now seen as the Silicon Valley of Asia. Tighter Net neutrality rules might be needed to ensure that Singapore's many Internet start-ups can compete on a level playing field with established operators," he said.

itham@sph.com.sg

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Personal Data Protection Act 2012 - Personal Data Protection (Prescribed Healthcare Bodies) Notification 2015 (S 90 of 2015)

Companies Act: Easing of prohibition against financial assistance

Legislation
12 Feb 2015

Ex-CPIB assistant accused of theft, cheating

Business Times
28 Feb 2015
Claire Huang

Singapore

A FORMER assistant at the Corrupt Practices Investigation Bureau (CPIB) has been charged in court with 15 offences, including the stealing of credit cards and cheating.

Christopher Gan Boon Khong, 25, faces two counts for the theft of two cards, 12 of cheating and one of causing hurt.

Most of the charges relate to the events of last June 29, when he allegedly stole a HSBC credit card belonging to Wendy Lim at around 2am at Club V6 in Jalan Sultan. Three minutes later, he was said to have cheated cashier Lee Tai Tee by buying nine shots of tequila worth S$135 using the card; in the next 50 minutes, he supposedly ran up a S$1,430 bill buying 11 flower garlands.(In some nightspots, patrons buy these garlands as a gesture of appreciation for their favourite performers.)

Gan is also accused of stealing a DBS debit card belonging to Vedula Vijay Kumar the following month, also at Club V6. He then headed for Club 1+1 in Tanglin Shopping Centre, where - just 45 minutes later - he allegedly bought two bottles of Martell.

Then, less than 10 minutes later, he allegedly used the card to buy four more bottles of Martell valued at S$776 at Club Gaga, also at Tanglin Shopping Centre.

Gan was back at Club V6 about an hour later, where he apparently threw a Chan Kian Hong to the ground and kicked him in the groin.

Gan's bail has been set at S$15,000; the case will be mentioned on March 27.

For theft, he could be jailed up to three years and be fined. The maximum punishment for each cheating offence is a jail term of 10 years and a fine. If convicted for causing hurt, he could be jailed two years and fined S$5,000.

In a statement on Friday, CPIB said Gan resigned from the service last July 4.

It added that it does not condone criminal or improper acts by its officers and that errant officers will be dealt with and can expect to face criminal and/or disciplinary proceedings if they are involved in wrongdoing.

huangjy@sph.com.sg

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Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 8) Notification 2015 (S 89 of 2015)

SHC grants Mareva injunction against former officers of shipping company in liquidation

Judgments
12 Feb 2015

RHT Holdings prepares to list on Catalist

Business Times
27 Feb 2015
Claire Huang

[Singapore] THE holding company owned by the equity partners of law firm RHTLaw Taylor Wessing LLP has started the process for its proposed listing on the Catalist board of Singapore Exchange. The move is a first by a Singapore law firm to list its professional services arm in the Republic.

RHT Holdings Limited, a professional services group in Asia, on Thursday said that the proposed listing is scheduled for the first quarter of 2016 or earlier. It is the holding company for four of 12 subsidiaries under the RHT Group of Companies - RHT Compliance Solutions, RHT Corporate Advisory, RHT Capital and RHT Management Services. RHT Holdings has appointed Hong Leong Finance Ltd as its financial adviser and sponsor for the proposed listing.

Tan Chong Huat, the holding company's non-executive director, said that the proposed listing will provide funds for the group's international ambitions. "In three short years, RHTLaw Taylor Wessing LLP and the RHT Group have become premier names in Singapore for legal and professional consulting services, respectively. We now wish to tap into capital markets to accelerate growth both in Singapore and internationally."

Asked about the amount to be raised, Mr Tan said that it hinges on the valuation, which could be higher as the company is now looking to make one or two acquisitions.

He noted that the Republic is the group's home base, and its reputation as a financial hub will fuel the company's growth. And while "the price earnings given to businesses on the Catalist" in Singapore is "actually quite low", Mr Tan said that the professional services industry is a business that investors here will understand, so he thinks that the company is poised to do well in Singapore.

Citing the example of consultation papers released by the Monetary Authority of Singapore in recent years, Nizam Ismail, who heads RHT Compliance Solutions, noted that the financial industry here is facing a tremendous amount of rule changes, and this represents business opportunities.

In the 18 months since RHT Compliance Solutions was started, it now has a client base of 100 organisations, said Mr Nizam.

In line with its strategy to stay ahead of the competition, the company plans to gain a foothold in Indochina next, Mr Tan said, followed by Hong Kong.

Last November, Zico Holdings, which provides professional services in areas such as trust advisory, business support and advice on syariah or Islamic law, was listed on the Catalist board on the Singapore stock market.

It was set up to mainly serve the customers of Kuala Lumpur-based legal outfit Zaid Ibrahim and Co, commonly known as Zico, and was a way for Malaysia's biggest law firm to tap capital markets while adhering to local rules that forbid non-lawyers from owning law firms.

huangjy@sph.com.sg

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Requisition of Resources Act - Requisition of Resources (No. 2) Order 2015 (S 88 of 2015)

SCA holds shareholder with majority voting power disentitled from claiming relief under s 216 Companies Act

Judgments
11 Feb 2015

S’pore students in UK hit out at law school restrictions

TODAY
27 Feb 2015
Neo Chai Chin & Amanda Lee

Those from eight dropped universities may be seen as inferior by employers

SINGAPORE — As a debate ensues on the pros and cons of different methods of ensuring the quality of returning law graduates from the United Kingdom, some law students there have lamented the restriction of choices for prospective students wanting a legal education in the UK.

These come in the wake of the Ministry of Law’s (MinLaw) announcement on Tuesday that eight UK law schools would be dropped from the list of universities recognised for admission to the Singapore Bar.

The reduced list of 27 overseas scheduled universities (OSUs) — including those from Australia, the US, and New Zealand — will apply to intakes from the 2016/2017 academic year.

The UK law schools that will be dropped include the University of Exeter, University of Leeds and University of Leicester. Among the 11 UK law schools retained are the University of Birmingham, University of Cambridge, and King’s College London.

Some have suggested that the authorities could have reverted to allowing only those with second-upper honours degrees and above to qualify for admission to the Bar here, but Senior Counsel Edwin Tong noted that this suggestion still carries uncertainties for the law students.

Trimming the list of recognised schools would be a better solution, said Mr Tong, who sits on the law Government Parliamentary Committee (GPC). The two ideas are ultimately different methods of ensuring quality and restricting the number of entrants to the Bar here, and both have their drawbacks and advantages, he said.

Law GPC chairman Hri Kumar Nair said he was personally not in favour of having any barriers of entry to the profession. Anyone who wants a law degree should be able to get one, provided they do not expect jobs as lawyers to be waiting for them when they graduate, said the Senior Counsel, adding that they should be prepared to compete if the market becomes tougher when they graduate.

Instead, Mr Nair felt the Bar exam should be “sufficiently rigorous” to ensure the quality of entrants.

In response to TODAY’s queries, president of the UK Singapore Law Students’ Society Kok Weng Keong regretted the fact that fewer practising Singaporean lawyers would benefit from the rich traditions of a UK legal education, which includes exposure to different legal systems.

“With the international direction that the Singapore legal industry is progressing towards — be it the Singapore International Commercial Court, the Republic as an arbitration hub, or Singapore’s increasing prominence as a global financial centre — more UK-educated lawyers will definitely be an asset,” said the second-year King’s College London student.

The primary concern of students and alumni of the eight affected universities is the potential perception that their universities are inferior to those still on the list, and the effect this may have on their employability, said Mr Kok, 22.

“How good a lawyer turns out to be will be dependent on his/her tenacity and individual ability, and not on which law school he/she came from,” he added.

Second-year University of Exeter student Valerie Quek felt students from the eight universities could now be viewed as “third-tier” law students, behind those who studied in Singapore and those still on the list of recognised law schools.

While the news was “disheartening”, she said she still harbours hopes of practising law here.

Final-year University of Exeter undergraduate Ong Lejing, 22, echoed the view that employers might think graduates from the delisted universities “have read a less preferred or substandard syllabus” and are thus less qualified.

Asked if it envisions a target number of returning law graduates, MinLaw said the review of the OSU list is a qualitative review to ensure the continued high quality of overseas-trained entrants to the Singapore Bar.

“The impact on the overall number of law graduates is a consequence of the refinement of the list. Moreover, the effect of the review will only be felt in about five years’ time.”

chaichin@mediacorp.com.sg

leeguiping@mediacorp.com.sg


Law schools’ rank inconsistent across British broadsheets

A check on the rankings by three United Kingdom broadsheets, which were used in identifying the eight UK law schools that will be dropped from a list qualifying them for admission to the Singapore Bar, appears to partly bear out sentiments against such a methodology for being inconclusive of quality.

Schools largely fared differently across rankings done by different broadsheets, and many of them jumped or dropped places from year to year, TODAY found. The schools retained, however, are generally ranked higher than those axed.

The rankings — also studied longitudinally — used by the Singapore Institute of Legal Education in shortening the list of recognised UK law schools were The Times’ Good University Guide, The Guardian’s University Guide and The Independent’s Complete University Guide.

For instance, the University of Bristol — one of the 11 retained UK law schools — ranked 33rd on The Guardian this year, but 11th on the other two.

There were also swings over years. For example, even the University of Cambridge placed third, fourth and first, respectively, from 2013 to this year on The Guardian’s ranking.

The situation was the same when it came to the schools that were dropped. The University of Leeds, for instance, jumped about eight places from 2013 to last year, then dropped between one and three places this year.

AMANDA LEE

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Housing and Development Act - Housing and Development (Precincts for Upgrading Works) (Home Improvement Programme) Order 2015 (S 87 of 2015)

Changes to Singapore Companies Act expected to come into force in Q2 2015

Legislation
11 Feb 2015

Court backs law body in barring M. Ravi

Straits Times
27 Feb 2015
Selina Lum

ACTIVIST lawyer M. Ravi, whose mental health is in question, remains suspended from practice, after the High Court yesterday barred him from working until he is medically certified fit to practise.

The decision came after the Law Society, which regulates lawyers, applied to the court to compel him to undergo a medical examination.

Mr Ravi , 45, told reporters after the closed-door hearing that the move was discriminatory, unfair and politically motivated in the wake of his announcement that he would contest the next General Election.

He said he will see psychiatrist Munidasa Winslow, who is overseas, next Thursday. Hours later, in a statement, Mr Ravi said he was concerned that the suspension would deprive his clients of his legal assistance.

"The only thing I can do is use the suspension as a compulsory rest. It is then for me to provide the court with a clean bill of health from a physician as soon as possible," he said.

A statement from the Law Society said Justice Quentin Loh found that the society "had acted reasonably with good grounds to issue the direction for Mr Ravi to cease practice and was satisfied that Mr Ravi's fitness to practise has been impaired by reason of his medical condition".

On Feb 10, Mr Ravi was ordered by the society's council to stop practising, following concerns about his mental health.

Under the Legal Profession Act, it was obliged to apply to the court within seven days to order Mr Ravi to submit to a medical examination. The application, made on Feb 17, was heard on Tuesday and yesterday.

Yesterday, the society stressed that it was exercising its duty in making the application against Mr Ravi. "The judge stated that the Law Society has a duty to the public to ensure that lawyers are mentally and physically fit to practise," said the statement.

selinal@sph.com.sg

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Prevention of Human Trafficking Act 2014 - Prevention of Human Trafficking Act 2014 (Commencement) Notification 2015 (S 86 of 2015)

IPOS Case Summary: Romanson Co Lt. v Festina Lotus SA [2015] SGIPOS 3 (whether there was non-use of trade mark under s 22(1)(a), (b) Trade Marks Act)

Judgments
11 Feb 2015

Court strikes out application to review prisons’ grooming policy

TODAY
27 Feb 2015

SINGAPORE — The High Court has struck out an application by a former volunteer Sikh religious counsellor with the Singapore Prison Service (SPS) who had taken issue with the prison’s hair grooming policy for Sikh inmates and said his right to propagate his faith had been violated, after the SPS did not renew his volunteer pass.

Justice Quentin Loh said the applicant, Mr Madan Mohan Singh, did not have reasonable cause and that his application to start judicial review proceedings on these issues was “frivolous, and vexatious and/or otherwise an abuse of the processes of Court”.

Mr Singh, who was represented by lawyer M Ravi, had filed an application in 2013 to quash the labelling of Sikh prisoners as “practising” or “non-practising”. He had also sought a declaration that the SPS had violated his right to propagate his religion — which is contingent on him obtaining leave for the quashing order.

In response, the Attorney-General applied to have these applications struck out.

Based on the facts set out in Justice Loh’s judgment published yesterday, Mr Singh, a counsellor with the Singapore Anti-Narcotics Association’s Sikh Aftercare (Counselling) Services, began volunteering with the SPS in 2000.

In 2010, he wrote to the SPS requesting a review of the prison’s hair grooming policy for Sikh inmates. Sikhs who have unshorn hair and beards at the point of admission can keep them unshorn during their incarceration. But those who had shorn their hair and beards at the time of admission or during incarceration would not be allowed to grow them out.

In his request, Mr Singh asked the authorities to look into incidents where the policy had not been adhered to. He also objected to the terms “practising” and “non-practising” Sikhs, used at the time to distinguish between Sikh inmates with shorn and unshorn hair and beards.

The SPS has since switched to using the terms “shorn” and “unshorn”.

Following his request, the SPS saw a spike in the number of Sikh inmates requesting to keep their hair long. Upon investigation, it found Mr Singh had “actively and persistently encouraged” inmates to keep their hair and beard unshorn to challenge the policy. This was deemed a threat to prison discipline and safety. In December 2011, Mr Singh was told his volunteer pass would not be renewed.

Mr Ravi had argued that Mr Singh had the right to seek the quashing order, as by not renewing his volunteer pass, the SPS was curtailing Mr Singh’s right to propagate his religion to a group of Sikhs to whom he owed a duty to rehabilitate.

But Justice Loh disagreed, noting that the application, interpreted substantively, was to quash the hair grooming policy, not challenge the non-renewal of Mr Singh’s pass. Even if he accepted the argument that the policy was the reason for the non-renewal, this was still not an infringement of Mr Singh’s constitutional rights. This was because prisons are restricted spaces, within which inmates suffer temporary exclusion from society. “A person would thus ordinarily have no access to a prison, much less free access to propagate his religion to the inmates,” he said.

Justice Loh also noted that Mr Singh did not object to the policy in the first 10 years of his stint with the SPS.

Two prominent members of the Sikh community, including chairman of the Sikh Welfare Council’s Inmate Counselling Subcommittee Manmohan Singh, also filed affidavits on behalf of the Attorney-General attesting to the fairness of the policy, he said.

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Customs Act - Customs (Duties) (Amendment) Order 2015 (S 85 of 2015)

SHC – Proof of debt in liquidation: Claims for informal arrangements

Judgments
10 Feb 2015

Swee Hong gets order against proceedings

Business Times
27 Feb 2015
Lee Meixian

[Singapore] LISTED contractor Swee Hong on Thursday said it had on Feb 25 obtained an order from the High Court which restrains further proceedings in any action against the company for six months.

This follows its announcement two weeks ago that it had filed an application in the High Court to propose a debt restructuring plan with three of its creditors - United Overseas Bank, the Building and Construction Authority of Singapore and ACL Construction.

"The order is intended to bring stability to the company's operations, and allow the company time to finalise the scheme of arrangement in consultation with its key creditors, for the benefit of all the company's creditors," it said. "The order also strengthens and reinforces the company's ability to perform its obligations under its ongoing public sector construction contracts."

Swee Hong is working on some Land Transport Authority road and sewer-diversion projects. It added that it will continue to operate as usual in providing customer services while it puts in place a scheme of arrangement. It had also said in its recent announcement that despite some cash flow difficulties, there was a reasonable prospect or rehabilitating the company if it was allowed to carry on its business "without the threat and distraction of proceedings and other action which may be taken by its creditors". It also reassured stakeholders that the filing of the application would not adversely affect its commitment and ability to deliver its current construction projects.

Swee Hong turned its share trading halt to a suspension on Feb 11. The stock last closed at S$0.126 on Feb 5.

leemx@sph.com.sg

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Town Councils Act - Town Council of Tanjong Pagar (Conservancy and Service Charges) (Amendment) By-laws 2015 (S 84 of 2015)

Key legislative and regulatory developments in Singapore for the year 2014

Legislation
06 Feb 2015

Ex-tour guide told to prove he owns money he seeks to withdraw

Straits Times
27 Feb 2015
Toh Yong Chuan

FORMER tour guide Yang Yin was ordered by the High Court to prove that he owns the money frozen in the bank accounts that he is seeking to withdraw from.

The 40-year-old Chinese national has some $1.13 million in four OCBC bank accounts and wants to withdraw $12,000 each month to support himself and pay his lawyers.

But Madam Hedy Mok, the niece of wealthy widow Chung Khin Chun, is objecting to the withdrawals on the grounds that the money does not belong to him in the first place.

To break the impasse, the High Court yesterday ordered Yang to show proof that he has rights to the funds, said Yang's lawyer, Mr Joseph Liow, after the hour-long closed-door hearing.

"He has until March 26 to file an affidavit," said Mr Liow.

The Singapore permanent resident's assets were frozen in August last year after Madam Mok accused him of masterminding control over her aunt's assets, estimated to be worth $40 million, including a $30 million bungalow in Gerald Crescent off Yio Chu Kang Road.

Madam Chung met Yang in 2008, when he was her tour guide in China. The next year, he moved into her bungalow.

In 2010, she made a will leaving him all her assets, including the bungalow. Yang claims the widow, who has no children and whose husband died in 2007, treated him like a grandson.

Two years later, she granted him a Lasting Power of Attorney (LPA) which gave him control over her assets.

Madam Mok has sued Yang for allegedly breaching his duties under the LPA, which was revoked last November. Madam Chung has also made a new will which leaves her fortune to charity. Her niece has filed it with the Family Court and asked the court to execute it on her aunt's behalf.

Besides the civil court cases filed by Madam Mok, Yang also faces more than 300 criminal charges of faking receipts issued by his music and dance company.

The most serious charges are two counts of criminal breach of trust for allegedly misappropriating $1.1 million from Madam Chung. For each charge, he could be jailed up to seven years and fined. He has been denied bail and is in remand.

The next pre-trial conference for his criminal charges will be held next month while the next High Court hearing on his frozen assets will be in April.

tohyc@sph.com.sg

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Departmental Titles (Alteration) Act - Departmental Titles (Alteration) Act (Amendment of Schedule) Notification 2015 (S 83 of 2015)

SCA: Exclusion of set-off clauses and the UCTA “reasonableness” requirement

Judgments
06 Feb 2015

Noble says Iceberg author a former staff; group posts US$240m Q4 loss

Business Times
27 Feb 2015
Andrea Soh

Singapore

NOBLE Group has fingered a former employee as the person behind Iceberg Research, as it reported on Thursday its first quarterly loss in three years due to a heavy impairment charge on an associate.

The author of the research reports is a "disgruntled" former employee that the group fired 1 1/2 years ago, Noble chief executive Yusuf Alireza revealed in a briefing call.

"We have a high degree of confidence we know who it is," he said. The company has handed the information over to the regulators and does not intend to take any legal action against the person.

"We don't plan to spend any management time on it or shareholders' resources on it... Our stakeholders will judge us not by an anonymous blogger but by our results, and that's what we want to focus on."

The largest commodities trader in Asia by revenue posted a net quarterly loss of US$240 million - its first since September 2011, against a net profit of US$117 million a year ago. For the three months ended Dec 31, revenue dropped 14 per cent to US$21 billion.

For the full year, net profit almost halved to US$132 million, missing by far the average estimate of US$470.6 million by 13 analysts, according to Bloomberg data. Revenue was 4 per cent higher at US$85.8 billion.

Notwithstanding these, "2014 was a landmark year for us", said Mr Alireza, pointing to how the sale of Noble Agri had freed up its balance sheet, and "breakthroughs" in performance and market penetration, in particular by its oil liquids and power businesses in the US.

The group said that it had written off US$438 million for the year, including a US$200 million charge for Yancoal Australia, the valuation for which had been criticised by Iceberg Research.

The little-known research firm had earlier questioned Noble's accounting treatment of certain subsidiaries and said that the group overstated the value of Yancoal - the Australia-listed coal miner in which Noble has a 13 per cent stake - by US$603 million.

Noble, however, said that its latest results had not been affected "in any way" by the Iceberg report. The group reviews the value of its associates and investments on a quarterly basis, and on a more detailed level annually.

It arrived at the value for Yancoal based on a cash flow model that has been verified by both internal control functions and its auditor EY, and used conservative assumptions around input variables such as production levels, fuel inputs and coal prices.

The model provides for a range of values, and "we have impaired Yancoal right below the bottom of that range", said Mr Alireza, who also called Iceberg's suggestion of using the market capitalisation of Yancoal as its value "naive".

Both its board and auditor are comfortable with the adjustments in value, he added.

Noble's shares have fallen 12 per cent since Iceberg published its first report on Feb 15. Its website does not provide any contact details nor other identifying information.

In its second report on Thursday, Iceberg pointed to a "divergence" between Noble's net profit and operating cash flow as a result of Noble overstating the fair value of its long-term contracts.

Noble has a practice of booking the entire profit for long-term unrealised contracts the same day they are signed, said Iceberg. It also suggested that Noble had manipulated projections for forward prices and tonnage to inflate the fair values of these contracts. "These contracts surged from near zero in 2009 to an unprecedented net US$3.8 billion," it said in a 28-page report released before Noble announced its results. Impairing these values would "dramatically impact" Noble's financial performance.

Iceberg further accused Noble of stretching accounting rules "to the maximum", though it said that there was no outright accounting fraud.

Noble rejected these claims of inflated unrealised contract values as "factually incorrect". Iceberg had ignored the fair value of inventory, and the effect of short-term rolling hedging versus the long-term physical contracts, it said.

The group has a consistent mark to market - or the practice in measuring the fair value of its contracts - policy, Mr Alireza emphasised. "This is our core business."

As part of the asset-light strategy that the group is pursuing, its business model relies on the group's ability to manage market, credit and operational risks for buyers and sellers. The group manages 12,000 contracts with a weighted average duration of five years.

These are marked to market in order to provide profit and loss figures daily, said Mr Alireza. "It's a function of risk management."

Iceberg Research is expected to release a third report that will focus on Noble's debt levels and its investment grade credit rating. Noble's shares, which were suspended on Thursday morning following the second attack by Iceberg, will resume trading on Friday.

sandrea@sph.com.sg

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Income Tax Act - Income Tax (Exemption of Interest and Other Payments on Economic and Technological Development Loans) (No. 2) Notification 2015 (S 82 of 2015)

SCA clarifies the “offer to settle” regime

Judgments
05 Feb 2015

Film-maker files police report against MP

Straits Times
27 Feb 2015
Rachel Chang

He accuses Lam Pin Min of making racially seditious comments online

POLICE are looking into a report made by film-maker Martyn See against People's Action Party (PAP) MP Lam Pin Min, whom Mr See has accused of making racially seditious comments.

Dr Lam posted on his Facebook page earlier this month about three Singaporean men who were arrested at Thaipusam celebrations on Feb 3 for various offences. These included disorderly conduct and voluntarily causing hurt to a police officer.

Linking to a blog post that has since been deleted, Dr Lam wrote: "An example of how alcohol intoxication can cause rowdiness and public nuisance."

In his police report yesterday, Mr See charged that these comments "distorted an allegation by the police into a statement of fact".

A police statement on the trio's arrest said that "all three men were believed to have been drinking earlier as they smelt strongly of alcohol".

But, Mr See said, this has yet to be established by the authorities as fact and the three men have not yet been tried.

In saying that the three were intoxicated while participating in the holy festival of Thaipusam, Dr Lam incited enmity towards the Hindu community, he charged.

The police yesterday confirmed a report has been made and told The Straits Times they are "looking into the matter".

Mr See also complained in his police report that Dr Lam's comments "caused ill will and hostility between different races and communities. The responses on his Facebook page show overwhelming hostility to his remark. Yet, he has allowed his offending words to remain online".

He added that Dr Lam breached the sub judice rule, as judicial proceedings in this case have yet to be completed.

Dr Lam, MP for Sengkang West, could not be reached for comment.

rchang@sph.com.sg

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Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 7) Notification 2015 (S 81 of 2015)

Latest developments: Dispute resolution, financial assistance prohibition for private companies, corruption

Business
04 Feb 2015

Shorter list of approved UK law schools welcomed

Straits Times
26 Feb 2015
Amelia Teng & Amir Hussain

Lawyers say it will ensure high standards but students studying there are worried

THE decision to cut eight British law schools from the list of overseas universities recognised for admission to the Singapore Bar has been welcomed by some lawyers here.

They said that it will not just ensure the high standards of the legal profession in the country, but also help curtail the growing number of Singapore students flocking to Britain to do a law degree.

But some students already at the affected schools are worried that their degrees would now carry a question mark, making it even harder for them to find a job as a lawyer when they return.

On the recommendation of the Singapore Institute of Legal Education (Sile), the Ministry of Law on Tuesday revised the list of recognised universities. It said the University of Exeter; University of Leeds; University of Leicester; University of Liverpool; School of Oriental and African Studies, University of London; University of Manchester; University of Sheffield; and University of Southampton will be dropped from the list.

The changes, which will only affect intakes from next year, leave 11 British universities, such as the University of Birmingham and the University of Bristol. There were no changes to the 10 Australian, four American, two Canadian and two New Zealand universities on the list.

The eight universities which will be dropped had in the last three years accounted for 30 per cent of the 729 Singaporean graduates from British law schools.

But these eight schools are also among the lower-ranked law schools in Britain and their graduates are often the ones who find it harder to get jobs, said NUS law dean Simon Chesterman. "The message to parents and students is that instead of spending tens of thousands of pounds on a law education at a lower-ranked school, they could be better off pursuing other degrees locally."

Last August, Law Minister K. Shanmugam highlighted the spurt in the number of Singaporeans pursuing law overseas. In Britain, the number of Singaporean law students more than tripled from 350 in 2008 to 1,142 in 2013.

This made it harder for returning overseas graduates to get a six-month practice training contract at a law firm - a requirement for entry to the Bar. Last year, nearly 650 graduates competed for about 490 practice training contracts.

The number of local law graduates is currently about 400 each year, and this is set to increase when a third school focusing on criminal and family law opens at the SIM University.

Prof Chesterman was part of the 4th Committee on the Supply of Lawyers.

In 2013, the high-powered panel suggested that Sile review the list of overseas universities every five years - a recommendation which was accepted by the Government. The purpose, the committee said, was to ensure quality control. This is the first revision in the wake of that decision.

Law Society president Thio Shen Yi said a regular review is "important to ensure that we continue to get top-quality entrants to the Singapore Bar".

"In any review process, one can expect some universities to be added or removed. In an environment where there are far more law graduates than training contracts on offer, it is not surprising that this review contracted the existing list," he added.

Some students from the affected British law schools were disappointed with the changes.

Said Goh Jia Jie, 23, a first-year University of Liverpool law student: "Liverpool is still ranked quite highly in Britain and the world, and the education provided to the students is like that at any law school - challenging and arduous."

The Ministry of Law said it will work out provisions with the Sile to ensure that those who have secured a place in the eight schools before 2016 "are not adversely affected by the change", without giving details.

Ms Shannen Tan, a second-year law student at the University of Exeter, was able to look at the bright side. "From a long-term perspective, fewer lawyers will mean an increase in their value and worth in the future," said the 22-year-old.

Some lawyers believe that while a quality degree counts, it is not the only assurance of the makings of a good lawyer.

Said Peter Low law firm director Choo Zheng Xi: "A better way to ensure the quality of law graduates could have been to make the Bar exam more difficult to pass, or to let the market correct itself, because I know some excellent lawyers and law students from these eight universities."

Mr Josephus Tan, 35, a criminal lawyer with Fortis Law Corporation who has been recognised for his pro-bono work, graduated from the University of Southampton in 2007. "It doesn't really matter what school you come from. More importantly, it's your personal qualities, and the passion for the law that matters. I went into law to help people, not because of the prestige or the money," he said.

ateng@sph.com.sg

amirh@sph.com.sg

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Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 6) Notification 2015 (S 80 of 2015)

Financial Advisers Act and Insurance Act amended to implement policy proposals under the Financial Advisory Industry Review

Legislation
04 Feb 2015

Dropping UK law schools may hit S’pore’s hub status: Voices

TODAY
26 Feb 2015

As a Singaporean reading law in the United Kingdom, I read with concern about the review of the overseas scheduled universities whose returning law graduates are eligible for practice here. (“8 UK law schools to lose spots on recognised list”; Feb 25).

Dropping eight of the 19 UK law universities on the recognised list may, in the short term, reduce the burgeoning supply of law students in the Singapore market, but may also be detrimental to the long-term success of Singapore as a regional and international legal hub.

This preventive measure may take us a step back in the liberalisation of our legal sector.

Diversity is an integral catalyst for developing our ambitions and jurisprudence. In legal education, diversity is a starting point for developing Singapore’s influence in international law.

I do not disagree that a sharp increase in the number of Singaporean law graduates would, in the short term, result in an oversupply.

However, considering the benefits of diversity in legal education the increasing number of returning law graduates is a testament to the attractiveness and potential of Singapore’s legal sector.

Reading law in the United Kingdom has provided me with the opportunity to learn from and work with international experts in arbitration and academia, for example.

It has enriched my experience, network and transferable skills, which will contribute to Singapore’s aspirations to being an international legal hub.

If the drastic approach we have now taken results in an increase in law students at the remaining 11 approved United Kingdom law schools, it would not solve the pertinent problem of an increase in Singaporeans pursuing law overseas.

A better solution is to allow the market forces of demand and supply to determine the suitability of applicants from diverse backgrounds, and to assess the individuals’ character and commitment to our legal sector.

I am grateful for the opportunity to develop critical-thinking skills and read law with an international perspective. Legal education per se is a process, and not a determinant of one’s ability to pursue law.

The perspective that one’s institution of study equates to one’s capabilities is wrong. It is the individual’s characteristics that matter.

In shaping our legal landscape, we should embrace the aspirations and commitment of Singaporeans as an opportunity, and not a problem, for the development of our legal sector in a globalised economy.

Kwek Jia Hao

Copyright 2015 MediaCorp Pte Ltd | All Rights Reserved

Singapore Armed Forces Act - Singapore Armed Forces (Volunteer Corps - Ranks, Disciplinary Proceedings and Miscellaneous Powers) Regulations 2015 (S 79 of 2015)

Latest developments: Intellectual property

Business
04 Feb 2015

Petrol companies ordered to explain latest price hikes

Straits Times
26 Feb 2015
Jessica Lim & Adrian Lim

PETROL companies have been ordered by the Competition Commission of Singapore (CCS) to explain their latest price rises, which were more than the recent increase in government duty.

The move came after the Consumers Association of Singapore (Case) on Tuesday accused the four players here - Caltex, Esso, Shell and Singapore Petroleum Company (SPC) - of profiteering.

Pump prices across the island were raised by up to 25 cents per litre for 98-octane-grade petrol and as much as 18 cents for 95-octane on Tuesday, a day after the Government raised tariffs by 20 cents a litre for premium-grade petrol and 15 cents for the intermediate grade.

In a strongly worded joint statement to The Straits Times last night, the Ministry of Trade and Industry and CCS said: "We will not hesitate to take firm action against parties who are found to be engaging in anti-competitive behaviours at the expense of consumers."

The CCS was set up by the MTI to enforce competition law here and target anti-competitive practices, such as price-fixing and other abuses of market power.

Petrol firms defended their move, saying that prices are not determined by government excise duties alone.

Shell, which raised the price of a litre of 98-octane-grade petrol by 25 cents to $2.28 per litre on Tuesday, said: "Other factors also impact pump prices... crude oil price, exchange rates, manufacturing and production costs from crude to fuel, distribution costs of bringing the fuel to retail sites, operating costs of running service stations and government goods and services taxes."

At noon yesterday, the firm dropped prices by two cents a litre for its 98-octane-grade.

SPC and Esso, which raised pump prices by one cent more than the tariff amount, said the goods and service tax (GST) needed to be factored in as well. The former said it is actually "charging less than the total of the additional petrol duty plus GST". Both firms have not changed prices since raising them on Tuesday.

Caltex raised prices by as much as the tariff increase on Tuesday, then reduced them by 3 cents later that same day.

Dr Tan Khay Boon, a senior lecturer of economics at SIM Global Education, said petrol firms may be facing higher costs due to rising wages and crude oil prices.

"But if there are no other changes except for the higher petrol tax, then a magnitude of price hike larger than the levy may suggest profiteering," he added.

The benchmark Brent crude came close to a six-year low last month at US$46 a barrel but has since been bouncing back slowly. At 8pm yesterday, Brent was at US$59.16.

Case has sent letters to all four petrol firms here, asking each to explain why they increased prices.

As of last night, no replies had been received.

Mr Seah Seng Choon, Case's executive director, said: "If they cannot explain, I would say that basically, they are profiteering. We reckon that the petrol firms used this (the tax hike) as an opportunity to increase prices and profit."

He pointed out that profiteering is not illegal but added: "As businesses, they need to operate in a responsible way. Increasing prices without proper justification to consumers is not ethical."

Motorist and IT manager Tom Bennett, 38, said: "All the companies raised prices at around the same time, which suggests that there is not enough competition in the market. As a consumer, you want to feel that you have a choice and there is a fair market. It does not feel that way now."

limjess@sph.com.sg

adrianl@sph.com.sg

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Singapore Armed Forces Act - Singapore Armed Forces (Pensions) (Amendment) Regulations 2015 (S 78 of 2015)

Arbitration in 2014: Looking Ahead to 2015

Judgments
04 Feb 2015

Related party transactions: MND replies - Forum

Straits Times
26 Feb 2015

WE REFER to the commentary by Associate Professor Lee Kin Wai ("The problem with related party transactions"; Feb 18).

All town councils (TCs) are to prepare their financial statements in accordance with the Singapore Financial Reporting Standards (FRS). Under FRS 24, a TC is required to disclose related party transactions in the financial statements, in particular, the nature of the relationship and the amount of transactions.

Prof Lee referred to the revised FRS standards, which are applicable to financial statements for periods beginning on or after July 1 last year.

Under the revised standards, transactions between a TC and its managing agent (MA) will also be considered related party transactions, if the MA provides key management personnel services to the TC.

When this comes into effect, all TCs, except Bishan-Toa Payoh TC, which employs its own staff, will have to make related party transactions disclosure in their financial statements.

This new requirement will apply to the TCs' financial year (FY) 2015/2016 (April this year to March next year) and subsequent accounts.

It did not apply to their FY 2012/2013 accounts, which was the period of the Auditor-General's Office (AGO) audit of Aljunied-Hougang- Punggol East Town Council (AHPETC).

It will also not apply to the TCs' FY 2014/2015 accounts (April last year to next month) to be tabled in Parliament in October, since the accounts began before July 1 last year.

The AGO audit highlighted that AHPETC and its MA, FM Solutions and Services (FMSS), are considered related parties under the prevailing FRS 24.

This is because the key management personnel of AHPETC - its secretary Danny Loh, its general manager How Weng Fan and its deputy general manager Yeo Soon Fei - are also owners of FMSS providing paid services to AHPETC; they control FMSS and have a clear personal financial interest in transactions between FMSS and the TC.

FM Solutions and Integrated Services (FMSI) and AHPETC are also considered related parties because FMSI is a sole proprietorship owned by Mr Loh.

In no other TCs are their key management personnel also owners of their MA. They are either direct employees of the TCs, like in Bishan-Toa Payoh TC and the former Hougang TC, or employees of the MA, not owners.

With the exception of AHPETC, all other TCs' auditors did not raise any observation on related party transactions in their auditors' reports.

Christine Yap (Ms)

Director

Corporate Communications

Ministry of National Development

Source: Straits Times © Singapore Press Holdings Ltd. Permission required for reproduction.

Common Gaming Houses Act - Common Gaming Houses (Exemption) (No. 5) Notification 2015 (S 77 of 2015)

SHC overturned arbitral tribunal’s decisionthat China-Laos bilateral investment treaty be extended to Macau

Judgments
03 Feb 2015

QC rules still apply for conversions to serviced apartments

Business Times
26 Feb 2015
Kalpana Rashiwala

A key motivation for developers seeking change is hope of exemption from 2-year sales deadline, without paying any penalty

[Singapore] DEVELOPERS that may be thinking of converting private residential projects on sites that are subject to Qualifying Certificate (QC) conditions to serviced apartments may be heading for a dead end.

The Singapore Land Authority (SLA) would still require them to sell the whole project within the stipulated two years after completion - or pay extension charges.

An SLA spokesman told BT: "Land which is bought with approval under a qualifying certificate is bound by the QC condition that all the completed units must be sold within two years of obtaining TOP (Temporary Occupation Permit). This condition remains in force even where a developer obtains URA approval to convert the entire development into serviced apartments."

BT understands that a key motivation for developers seeking change is hope of exemption from the two-year sales deadline, without paying any penalty.

"Instead of paying extension charges, which are quite high," said a market watcher, "these developers are probably hoping that if they were to turn their projects to serviced apartments, the QC condition could be lifted as they intend to operate the serviced residences.

"When the market recovers, these developers could potentially seek to convert the property back to a condo, obtain approval for strata subdivision and sell the condo units. Basically, their strategy is to convert the project to serviced apartments to ride out the market."

A property consultant added: "Basically, many of these projects are in the prime districts, and high-end prices have tanked, so these developers are not ready to accept fair value prices. They are looking for a way to buy time, hoping that the high-end market will recover or that the authorities will relax on QC conditions."

Under the Residential Property Act, a foreign company, defined as one that has even a single non-Singaporean shareholder and/or director, has to get a QC from SLA's Land Dealings (Approval) Unit before it may buy a private residential site. All listed property developers are deemed foreign companies.

QC conditions require the developer to complete construction of the project and obtain TOP within the stipulated timeframe - since Aug 5, 2010, this has been set at five years, though prior to that, this could have stretched to seven years. The developer is also required to finish selling all units in the project within two years of the TOP date. The rules are aimed at preventing foreign developers from hoarding or speculating in residential land in Singapore.

Since January 2011, a developer that wants extra time on either of these two deadlines has to pay extension charges - set at per annum rates of 8, 16 and 24 per cent of the site's purchase price for the first, second and third/subsequent years of extension, respectively. For the two-year deadline to finish selling the project, the extension charges are pro-rated based on the proportion of unsold units. The extension charges may be paid on a half-yearly basis.

Sites bought from the Government Land Sales Programme and on Sentosa Cove do not require QC.

The SLA spokesman said: "In such a situation where the development is converted into serviced apartments, the developer would be required to sell the entire development as URA (Urban Redevelopment Authority) requires serviced apartments to be under one ownership and strata subdivision into individual units is not allowed.

"If it is unable to sell within the stipulated period, the developer can apply for an extension of time to sell and if approval is granted, an extension charge is payable by the developer."

Serviced apartments may be considered on land zoned for residential use in URA's Master Plan. This includes conversion of approved residential developments into serviced apartments.

"Serviced apartments may also be considered for the residential component of mixed-use sites," said a URA spokesman.

She said that the planning authority evaluates all serviced apartment proposals against a set of established guidelines. "Generally, the proposed serviced apartments should not be located in the midst of established residential areas and should front major roads. The guidelines ensure that serviced apartment developments are compatible with the surrounding uses and minimise any potential nuisance or disturbance to surrounding users."

Since strata division is not allowed in serviced apartments, developers who wish to restyle a condo into a serviced apartment development would need to make an application to the authorities to "extinguish" the strata titles in the project. Prior to that, the developer would have to buy back any units it had sold in the project.

If a developer wishes to turn, say, one block in a condo project comprising two or more blocks into serviced apartments, the authorities are likely to subject the application to detailed evaluation and may even impose additional criteria on the developer to ensure that the residents living in the strata-titled units in the other block or blocks are agreeable with the idea.

The topic of developers affected by QC conditions considering turning their housing projects to serviced residences has gained currency following City Developments executive chairman Kwek Leng Beng's comments last week on the Nouvel 18 condo that it developed jointly with Wing Tai. The project received TOP at the end of 2014. "There are two blocks. I think . . . we still have two years to do something about it, but in the meantime, we hope to apply for a waiver for the Qualifying Certificate . . . there is also a possibility we may convert one block into serviced apartments. Don't forget Shangri-La, at the side, they also have very beautiful serviced apartments which are doing very well."

Back in 2013, OUE is said to have enquired with the authorities about changing its Twin Peaks condo project in Leonie Hill Road into serviced residences but did not proceed as it found the conditions and regulations too impractical. The 462-unit project received TOP recently.

Word on the street is that Bukit Sembawang too has considered converting its Paterson Collection project which it has yet to launch, into serviced apartments.

Property industry players told BT that it would not be easy to convert a completed condo project or even one under construction into serviced residences - as there may not be provision for back-of-house facilities such as for laundry services and storage of towels as well as a breakfast area, reception and concierge services.

"Also," said an observer, "for serviced apartments, you need sprinklers within the units. Internal walkways in the development will also have to be sufficiently wide for service trolleys."

Besides interior criteria, URA probably also factors in the external environment, including the width of surrounding roads to gauge if they can handle the additional traffic arising from the conversion to serviced residences, he added.

kalpana@sph.com.sg

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Land Acquisition (Amendment) Bill (Bill 7 of 2015)

Recent updates in employment law

Legislation
03 Feb 2015

8 UK law schools removed from list of approved universities for admission to S’pore Bar

TODAY
25 Feb 2015
Teo Xuanwei

Change will apply to student intakes from AY2016/17 onwards

SINGAPORE — Nearly half of the approved UK law schools will be taken off the list of approved foreign universities recognised for admission to the Singapore Bar, after a review by the Singapore Institute of Legal Education (SILE).

There are currently 19 UK universities on the list of Overseas Scheduled Universities (OSU), but SILE recommended cutting the list down to 11. The Ministry of Law (MinLaw) has accepted the recommendation and will implement it for prospective intakes from Academic Year 2016/17 onwards.

The eight UK law schools taken off are: University of Exeter; University of Leeds; University of Leicester; University of Liverpool; School of Oriental and African Studies, University of London; University of Manchester; University of Sheffield; and University of Southampton.

In total, these eight universities accounted for 30 per cent (221 out of 729) of Singaporean graduates from UK law schools in the last three years.

In a press release today (Feb 24), MinLaw said: “In implementing the revised list, transitional provisions will be put in place to ensure that Singaporean citizens and permanent residents who have secured a place before the relevant cut-off date in any of the UK OSUs omitted from the list are not adversely affected by the change.”

The SILE review follows a recommendation by the Fourth Committee on the Supply of Lawyer in 2013, which noted the burgeoning numbers of Singaporeans heading to overseas law schools and then returning to practise here. The high-powered panel proposed that the list of approved UK law schools be “reviewed and updated to better reflect the current rankings of UK law schools”.

In August last year, Law Minister K Shanmugam also warned of a possible glut in lawyers here due to the spurt in the number of Singaporeans studying law overseas.

Although the number of recognised overseas universities has remained at 35 since 2006, the total number of Singaporeans reading law in the United Kingdom has more than doubled to 1,142 between 2010 and last year, based on the MinLaw’s estimates.

In addition, there were 386 Singaporeans pursuing a law degree in Australian universities last year. The UK and Australia are the main sources of returning law graduates.

xuanwei@mediacorp.com.sg

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State Lands (Amendment) Bill (Bill 6 of 2015)

Personal Data Protection Act 2012: New Regulations on appeals

Legislation
29 Jan 2015

High Court to decide on ex-tour guide's accounts

Straits Times
25 Feb 2015
Toh Yong Chuan

THE HIGH Court will decide tomorrow whether former tour guide Yang Yin can withdraw $12,000 a month from his frozen bank accounts for personal and legal expenses.

The 40-year-old Chinese national, who had his assets frozen pending legal action, is also asking the court to lift the freeze altogether, and accuses his opponent, Madam Hedy Mok, of not sticking to a deal in which he would be allowed to withdraw $3,000 each week.

"The judge has heard arguments and she wants to think about it before making a decision on Thursday," Yang's lawyer, Mr Joseph Liow, told reporters after the two-hour closed-door hearing yesterday.

Yang's assets, which were frozen in August last year, included $1.13 million in four OCBC bank accounts. He claims the money was a gift from Madam Chung Khin Chun, a wealthy 88-year- old widow he had befriended and is accused of manipulating.

His assets were frozen after Madam Mok, who is the widow's niece, accused him of masterminding control over her aunt's assets, estimated to be worth $40 million, including a $30 million bungalow in Gerald Crescent off Yio Chu Kang Road.

Madam Chung met Yang in 2008 while he was her tour guide in China. The next year, he moved into her bungalow.

In 2010, she made a will leaving him all her assets, including the bungalow. Yang claims the widow, who has no children and whose husband died in 2007, treated him like a grandson. Two years later, she granted him a Lasting Power of Attorney (LPA).

Madam Mok has sued Yang for allegedly breaching his duties under the LPA, which was revoked last November. Madam Chung has also made a new will which leaves her fortune to charity. Her niece has filed it with the Family Court and asked the court to execute it on her aunt's behalf.

In another development, the Attorney-General's Chambers has made an offer to Yang to plead guilty to some criminal charges.

He stands accused of two criminal breach of trust offences which allegedly involve the misappropriation of $1.1 million from Madam Chung. Each charge carries a sentence of up to seven years' jail and/or a fine.

The Singapore permanent resident also faces more than 300 counts of faking receipts issued by his music and dance company.

Yang's criminal lawyer Wee Pan Lee confirmed the offer, but declined to provide details. It is also unclear if Yang will accept the offer. He has been denied bail and is in police custody.

tohyc@sph.com.sg

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Road Traffic Act - Road Traffic (Motor Vehicles, Registration and Licensing) (Exemption) Order 2015 (S 76 of 2015)

Arbitration Law – Developments in 2014

Judgments
29 Jan 2015

Lawyers agree case is raising awareness of LPA

Straits Times
25 Feb 2015
Toh Yong Chuan

MR PETER DORAISAMY is a shipping lawyer while Mr Joseph Liow specialises in construction and employment laws.

Different fields, but both experienced litigators have crossed swords of late in the current battle over control of Madam Chung Khin Chun's wealth.

Mr Doraisamy, a 42-year-old director at Selvam LLC and who has practised law since 1999, represents Madam Hedy Mok, the niece of the 88-year-old widow.

Mr Liow, 46, the deputy managing director of Straits Law Practice LLC, represents Chinese national Yang Yin.

Mr Doraisamy said a high point came last November when the Family Court ruled that Madam Chung could revoke a Lasting Power of Attorney (LPA) that had effectively made Yang her guardian.

It involved an area of law rarely seen in court, given the novelty of the LPA. The scheme was introduced in 2010 to allow persons above 21 to nominate a volunteer to make decisions and act on their behalf if they should lose mental capacity one day.

In September, Madam Chung had asked the Office of the Public Guardian (OPG) to cancel the LPA she granted Yang in 2012.

The OPG took the case to the Family Court to have a judge decide whether Madam Chung, who was diagnosed with dementia earlier last year, had the mental capacity to cancel the LPA.

Mr Doraisamy believes the case has raised public awareness on the LPA.

And disputes can be expected to rise, given the ageing population and more people turning to using the LPA, he added.

Mr Liow, who has been practising law for 22 years, declined to say how his firm came to represent Yang, citing confidentiality.

But he agreed with Mr Doraisamy that the publicity over the widow's case will raise public awareness on the scheme.

"With the public being more aware of such legal issues, I would not be surprised that there would be more disputes in relation to LPAs."

TOH YONG CHUAN

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Public Transport Council Act - Public Transport Council (Ticket Payment Service Licence) (Exemption) (Amendment No. 2) Order 2015 (S 75 of 2015)

Strata Titles Board holds that child safety is paramount over concerns of building appearance and uniformity

Judgments
28 Jan 2015

Porsche Club, former member in legal spat

Straits Times
25 Feb 2015
JOYCE LIM

AN EXECUTIVE, whose company is suing the Porsche Club for copyright infringement, is now taking the same exclusive car club to court for terminating his membership.

Mr Franklin Tang Quan Yii is suing for unspecified damages in the Magistrates' Court, which allows claims for up to $60,000, for the loss of enjoying the rights and privileges as a member of the Porsche Club.

The club, which costs $250 to join and has a $15 monthly membership fee, comprises mainly professionals and businessmen. It holds motoring and recreational activities among its roughly 300 members.

To become a member with full privileges, one has to own a Porsche car in Singapore. But a year after ceasing to own a Porsche, the person can remain only as an associate member without voting rights.

In 2008, Mr Tang joined the club after buying a Porsche. In November 2012, he sold his sports car. But he had his membership renewed in 2013, as his wife had bought her own Porsche, and authorised him to use it. On March 4 last year, Mr Tang received an e-mail from Porsche Club informing him that his attempt to renew his membership for 2014 had been rejected.

The e-mail also highlighted that Mr Tang was simply an "associate member" in 2013, and that membership had expired at the end of that year.

But Mr Tang insists that at all material times he was an ordinary member, "by virtue of his wife's authorisation to use and enjoy her Porsche car after it was purchased in February 2013".

He claims that the club later "reversed its position" and sent him a notice around May 5 last year stating that his ordinary membership had been reinstated.

Mr Tang's lawyer told The Straits Times that his client rejected the offer to reinstate his membership and that the club has up to the first week of next month to file its defence.

Mr Tang is also upset that the issue of his membership was discussed at an Annual General Meeting held on March 23 last year, when the executive committee decided and announced that he was not a member.

Last March, local firm Philip Tang & Sons, where Mr Tang works as executive director, filed a lawsuit in the High Court against Porsche Club over copyright infringement.

The firm accused Porsche Club of reproducing an online membership portal which it developed, designed and installed.

Known as the Online Membership System (OMS), the portal allows the club to manage the particulars of its members and payment of fees.

According to court documents, the firm says it allowed Porsche Club the use of OMS only during the period Mr Tang was a member of the club's executive committee.

In 2009, Mr Tang was appointed to the post of assistant membership director but ceased to be an executive member in January 2013. At the end of December that year, his firm stopped hosting the OMS and deactivated it.

But Porsche Club reproduced the OMS on its website around Jan 16 last year, says the firm - an allegation the club denies.

The club said it had collaborated closely with Mr Tang by contributing to the design, layout and functions of the OMS. It rebutted Mr Tang's claims that he owns the copyright to the OMS, and described it as a generic online membership portal.

Attempts to reach the Porsche Club have been unsuccessful.

joycel@sph.com.sg

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Co-operative Societies Act - Co-operative Societies (Modification under Section 97) Order 2015 (S 74 of 2015)

Competition Law in 2014 and trends for 2015

Business
28 Jan 2015

Law Soc court application for M Ravi to get medical exam to be heard again on Thurs

TODAY
25 Feb 2015
Neo Chai Chin

SINGAPORE – The Law Society’s court application for lawyer M Ravi to get a medical examination, as well as Mr Ravi’s objection to it, will be heard again on Thursday behind closed doors.

Both sides appeared before High Court judge Quentin Loh for several hours today (Feb 24).

The Law Society, represented by Mr Pradeep Pillai of Shook Lin & Bok, had applied to the court for an order for Mr Ravi to submit to a medical exam, after stopping him from practising earlier this month until he was certified fit by a psychiatrist.

The society had to get a court application or, under the Legal Profession Act, its suspension of Mr Ravi would be lifted.

Mr Ravi was previously diagnosed with bipolar disorder and the society was informed this month that his psychiatrist had diagnosed him as being hypomanic. Hypomania is part of bipolar disorder and characterised by a distinct period of elevated or irritable mood. Mr Ravi continued to practise despite being certified medically unfit for duty for four days earlier this month, the society had said.

The Law Society’s council became concerned about his mental condition and fitness to practise. It ordered him to stop practising in his own interests and those of the legal profession and the public, it said in a media statement on Feb 12.

chaichin@mediacorp.com.sg

Copyright 2015 MediaCorp Pte Ltd | All Rights Reserved

Sewerage and Drainage Act - Sewerage and Drainage (Trade Effluent) (Amendment) Regulations 2015 (S 73 of 2015)

SHC: Setting aside SOPA determinations

Judgments
27 Jan 2015

Short end of stick for firms targeted by short-sellers?

Straits Times
25 Feb 2015
Yasmine Yahya

THE fallout from accusations made against Noble Group by Iceberg Research reflects not just how influential such analysts can be but also that regulators are starting to pay serious attention.

Yet there is also an increasing awareness in the market that there is little that regulators can do in such situations, especially if the research firms are based overseas.

The Monetary Authority of Singapore (MAS) said last week that it would "take appropriate action" if the statements in the Iceberg report breached the Securities and Futures Act.

Iceberg has claimed that Noble uses accounting loopholes to inflate its profits and hide its losses.

The research house has declined to reveal where it is based, how many people are behind it or who they are. Its website has no identifying or contact information.

Faceless though it may be, its report has had a big impact, even after Noble denied the allegations. Noble shares declined almost 13 per cent to a two-week low in the two days of trading after the report was issued.

Although the stock recovered a bit of ground last Wednesday before the Chinese New Year break, it continued to fall yesterday, ending the day down 2.5 cents, or 2.3 per cent, at $1.06.

Noble is only the latest in a series of Asian companies on the receiving end of such attacks.

In the past four years or so, several research firms, usually based in the United States or Europe, have targeted Asian companies with similarly scathing reports, causing sharp falls in their share prices.

These research firms are often short-sellers. That is, they have made a bet that the company's share price will fall, so in triggering the slump of the stock with their reports, they are also making big profits.

Iceberg has denied shorting Noble stock. But in 2012, research firm Muddy Waters attacked Olam International after having shorted its shares.

Market observers have long called for more to be done to rein in such practices, noting that it is wrong for short-sellers to short a stock, then use their outsize influence to issue a negative report and cause that share to fall, thereby making a profit at the expense of retail investors.

"This is unfair trading in every sense but Muddy Waters got its reward. It exposes a loophole in the global trading community," said retail investor Geoffrey Kung.

The writers of such critical reports, which can cause volatility in the markets, should also be accountable and preferably regulated by the local authorities of the market, he added.

The watchdogs are now taking note.

In December, Hong Kong's securities regulator began its first legal action against famous short-seller Citron Research for issuing a "false and misleading" report on Chinese property developer Evergrande Real Estate Group and profiting from the company's share drop.

The MAS move to review Iceberg's report looks to be a step towards the same direction. However, corporate lawyer Adrian Chan notes that regulators will likely not be able to do very much.

"The odds are stacked against them, especially if the firm is beyond their territorial jurisdiction. They would need the cooperation of the relevant authority and even then, these things take a long time," he said.

"Definitely there should be a more holistic cross-border approach to ensuring a level playing field for capital markets, but the good news is that the authorities are moving in that direction, forging closer contact and cooperation."

Global regulators are working together more closely than before to tackle cross-border financial crimes such as tax evasion, money laundering and terrorism financing, he noted. It is only a matter of time before they turn their focus on rooting out unscrupulous short-sellers.

But veteran investor Mano Sabnani believes these short-sellers have their value too.

"They provide different perspectives - they are critical and look at the negative side of companies. We seldom see strong sell reports from regular broking houses and analysts," he noted.

"Regulators should not jump into action to catch these companies. Let the market decide. If the reports are bad, I'm sure the companies can refute the points made."

yasminey@sph.com.sg

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Sewerage and Drainage Act - Sewerage and Drainage (Sanitary Works) (Amendment) Regulations 2015 (S 72 of 2015)

Recent amendments to the Companies Act: Rethinking dual-class shares in Singapore –caveat emptor?

Legislation
27 Jan 2015

US ruling on Net neutrality will have impact worldwide

Straits Times
25 Feb 2015
Ang Peng Hwa & Kyu Ho Youm

THE recent announcement by Mr Tom Wheeler, chairman of the United States Federal Communications Commission (FCC), that the US government will ensure Net neutrality signals a significant shift in how the Internet will be treated in the future.

The signal was clearly timed for the start of the Internet Corporation for Assigned Names and Numbers (Icann) meeting in Singapore that began on Feb 9 after Mr Wheeler's announcement.

"These bright-line rules," he declared, "will ban paid prioritisation and the blocking and throttling of lawful content and services."

Net neutrality is based on the core principle that Internet providers should treat online content equally. There should be no such thing as "fast lane" or "slow lane" in the Internet traffic for those who can or cannot afford to pay.

To date, only three nations - Brazil, Chile and the Netherlands - have formally ratified Net neutrality as a legal requirement.

Under the proposed rules, the US would regulate the Internet like a public utility provider. This would mean preventing Internet service providers (ISPs) from giving faster, better access to higher-paying customers, such as businesses. The FCC is expected to vote on the rules this week.

Although Net neutrality suggests moderateness (what could be more neutral than the very word "neutrality"?), Mr Wheeler's statement is strong and loaded with political overtones.

What's significant about his statement is that it was an explicit commitment by the US to Net neutrality.

His unreserved adoption of Net neutrality as a central principle of American Internet law was a paradigm-shifting moment.

For one thing, it brings the Internet within the ambit of regulators.

The US has always treated information services as a private- sector activity. This has meant a hands-off approach for the government. The Internet was viewed as a means to information services. Thus, it was left unregulated. Or more accurately, no new Internet-specific regulation was deemed necessary.

Because it had been invented from parts that were already regulated in the US - the telephone, the computer, software service - the Internet was already subject to regulation of one sort or another, albeit indirectly.

With the rise of the Internet, there was no move to develop a body of new regulation. For example, there are no rules on the quality of Internet service.

This was unlike Singapore, which had quality of service rules even from the early days of the Internet.

In Singapore, the Internet regulator, the Infocomm Development Authority (IDA), has developed a clear position on Net neutrality.

After a round of consultation in 2010, the IDA's position on Net neutrality came down on the side of protecting the consumer.

ISPs in Singapore can sell "fast lanes" as long as they continue to offer good service levels to their average users. But they are banned from blocking legitimate Internet content or degrading website access to such an extent that the websites become effectively blocked.

Second, the US government's policy change on Net neutrality can be said to be a triumph for grassroots politics. It is a direct result of the bottom-up push of Americans to the Obama administration to prioritise Internet users, not Internet gatekeepers.

Third, the change in stance on Net neutrality could have an impact beyond the US.

Under American law, Internet access is neither a human right nor a constitutional right. The FCC's Net neutrality rules are based on the US Communications Act, not on a constitutional mandate.

The FCC rules would reclassify broadband Internet - both wired and wireless - under stricter laws and treat it like a utility, giving people access to it the way they have access to power and water.

But as it is not constitutionally mandated, the rules will not be as permanent. This stands in sharp contrast to an increasing number of countries, such as France, Greece and Costa Rica, where individuals now have a constitutional right to access the Internet.

In this sense, the US trails, not leads, many other countries in promoting Internet access as a human right. Its decision is certain to animate conversations globally on this issue.

The Net neutrality evolution in American law is relevant to many countries as a valuable reference point to the interconnected world. Not because it may offer solutions to the world's Internet law issues, but because it has chosen, as in the past, to experiment with an array of new free-speech issues. Governments around the world should watch how the US government manages its Internet through Net neutrality.

stopinion@sph.com.sg

Ang Peng Hwa is professor at the Wee Kim Wee School of Communication and Information, Nanyang Technological University, Singapore, where Kyu Ho Youm is the Wee Kim Wee visiting professor. The latter is from the University of Oregon, where he is the Jonathan Marshall First Amendment Chair.

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Sewerage and Drainage Act - Sewerage and Drainage (Composition of Offences) (Amendment) Regulations 2015 (S 71 of 2015)

Supreme Court Note: Mohammed Ibrahim s/o Hamzah v PP [2014] SGHC 269 (sentencing principles for National Service defaulters)

Supreme Court Note
27 Jan 2015

The accused was sentenced to two months’ imprisonment for defaulting on his National Service (“NS”) obligations under the Enlistment Act (Cap 93, 2001 Rev Ed).

The period of default was about one year and three months. The High Court allowed the accused’s appeal against sentence and substituted the sentence of two months’ imprisonment with a fine of $3,000.

The court clarified that the parliamentary statement regarding NS defaulters made by the Minister for Defence in January 2006 (“the Ministerial Statement”) that a jail sentence should only be imposed where the period of default was two years or more was merely an expression of the prevailing prosecutorial policy, and should not automatically be adopted by the courts as a starting point in sentencing. It was also clarified that the Ministerial Statement was intended to be of general application to all NS defaulters, and not just overseas defaulters.

Nevertheless, the court, after surveying the relevant sentencing precedents, concluded that cases involving short periods of default of two years or less generally would not attract a custodial sentence. The length of the period of default was hence an important but not conclusive factor in determining how severe a sentence ought to be imposed. The court also observed that an intention to evade NS and a failure to voluntarily surrender to the authorities were both neutral factors and not aggravating factors in sentencing under the Enlistment Act. Having regard to the length of the accused’s period of default and the fact that there were no aggravating or mitigating factors present in his case, the court concluded that a custodial sentence was inappropriate and therefore allowed the appeal.

At Mohammed Ibrahim s/o Hamzah v Public Prosecutor [2014] SGHC 269, paras 21, 26, 31, 35, 37 to 38, 40 to 42.To view the judgment, click <here>.

Disclaimer: The above is provided to assist in the understanding of the Court’s judgment. It is not intended to be a substitute for the reasons of the Court. The full judgment of the Court is the only authoritative document.

ADV: LexisNexis Trends Update on Legal Cost Management

Singapore Law Watch
25 Feb 2015
LexisNexis

Public Utilities Act - Public Utilities (Reservoirs and Catchment Areas) (Amendment) Regulations 2015 (S 70 of 2015)

Factoring TIC offences to enhance sentence: The extent and limit

Business
26 Jan 2015

Dropping Reits' stamp duty concessions helps level playing field

Straits Times
25 Feb 2015
Goh Eng Yeow

THERE was a predictable moan from real estate investment trust (Reit) managers and tax experts over the Government's decision not to extend the stamp duty concessions for Reits on the purchase of local properties after they expire on March 31.

It would add another 3 per cent to the costs of Reits acquiring properties here and make it more challenging for them to grow their portfolios, they complain.

Yet, as Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam noted in his Budget 2015 speech, the stamp duty concessions "were intended to enable the industry to acquire a critical mass of local assets as a base from which Reits can expand abroad, (and) this has been achieved".

One might also add that the move would level the field for other players in competing with Reits to acquire properties in Singapore.

In 2005, when the stamp duty waiver - together with a slew of other tax incentives - were given, there were only five Reits listed here with a total market value of $9 billion.

That has since grown to 28 Reits and six stapled securities - an asset class which involves a Reit "stapled" to other forms of investments - with a total market capitalisation of $67 billion.

But despite bulking up in a big way in the past 10 years, Reits have continued to chase property deals in the small congested Singapore market rather than try to use their financial clout to land prized catches overseas.

According to Ms Christine Li, director of research at Cushman and Wakefield, six of the top 10 investment deals last year involved Reits buying properties locally, worth a total of $4 billion in transaction value.

Several Reits are also 100 per cent Singapore-focused.

These include well-known names in the market such as CapitaMall Trust.

A few, such as Far East Hospitality Trust, are said to have a pipeline of local assets lined up for injection by their respective sponsors.

That said, the Government is going to extend income tax and goods and services (GST) tax concessions which Reits currently enjoy.

The implied message, one concludes, is that, going forward, Reits should try to buy from overseas to grow their portfolios.

With the extensions, Reits will continue to enjoy tax exemption on qualifying foreign-sourced income, a reduced withholding tax of 10 per cent on its payouts to foreign institutional investors and GST remissions on business expenses for Reits with overseas assets.

Ernst and Young tax partner Lim Gek Khim said: "For Reits investing in overseas properties, this would facilitate more overseas acquisitions and encourage the listing of cross-border Reits on the Singapore Exchange."

In its Think Singapore report, Citi Research noted that allowing the stamp duty concession to expire was a less damaging removal of a tax incentive given to the Reit sector.

This is because it is a transaction-based tax that would not add to the ongoing tax burden to the Reit or the Reit investor.

The impact of removing the stamp duty waiver is slight enough "not to create too un-level a playing field that would lead Reits to favour overseas acquisitions where stamp duties may still be payable in any case", it added.

engyeow@sph.com.sg

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Public Utilities Act - Public Utilities (Composition of Offences) (Amendment) Regulations 2015 (S 69 of 2015)

Supreme Court Note: PP v Chum Tat Suan [2014] SGCA 59 (application of ss 33B(2)(a), 33B(3)(a) Misuse of Drugs Act)

Supreme Court Note
26 Jan 2015

In this case, the Applicant, the Public Prosecutor sought clarification from the Court of Appeal on three questions of law relating to the application of ss 33B(2)(a) and 33B(3)(a) of the Misuse of Drugs Act (Cap 185, 2008 Rev Ed) (“MDA”): 

(a)   Whether a person convicted of an offence of drug trafficking or importation under ss 5(1) or 7 of the MDA bears the burden of proving on a balance of probabilities that he satisfies the requirements under ss 33B(2)(a) and 33B(3)(a) (“Question 1”).

(b)  Whether the court must take into account evidence that had been adduced at the trial leading to a conviction under ss 5(1) or 7 of the MDA in determining whether the person convicted satisfies the requirements under ss 33B(2)(a) and 33B(3)(a) (“Question 2”).

(c)   Whether an accused person, who had intended to sell the controlled drugs which form the subject matter of a charge under ss 5(1) or 7 of the MDA for which he had been convicted, satisfies the requirements under ss 33B(2)(a) and 33B(3)(a) (“Question 3”).

In relation to Question 1, the court clarified that the answer was an obvious “yes”. The language in ss 33B(2) and 33B(3) could not be any clearer. Likewise, in relation to Question 2, the answer was an unequivocal “yes”. It was not controversial by any measure that a court must, during sentencing, take into account all the evidence that has been adduced at the trial leading to the conviction. In relation to Question 3, the answer to was a clear “no”. If the person convicted has been found to have the intent to sell the controlled drugs, then he is evidently not merely a courier (which is the focal point of s 33B(2)(a) and s 33B(3)(a)), though if it is clear that offender’s involvement was truly that of a courier, the mere incidental act of storage or safe-keeping by the offender in the course of transporting, sending or delivering the drugs, should not take him outside of the definition of a courier.

The court however was divided on a question incidental to Question 2, which is whether an accused person who has been convicted of drug trafficking or importation is permitted to introduce new evidence at the sentencing stage to bolster his claim to being a courier. The majority took the view that the answer to this incidental question was “no”. All evidence, including those relating to the issue of whether the accused person is a courier, must be adduced at the trial. The introduction of s 33B of the MDA did not create a different procedure in relation to the giving and taking of evidence in criminal proceedings. The minority took the view that Even though an accused person should in general raise his full and complete defence, as well as adduce all the relevant evidence at trial, there is no rule which absolutely precludes the adduction of new evidence at the sentencing stage. The interest of justice requires that every offender be, as far as possible, sentenced on the basis of accurate facts, and that under very limited circumstances, evidence pertaining to the accused person’s alleged role as a courier may be introduced at the sentencing stage even if it was not adduced at the trial.

At Public Prosecutor v Chum Tat Suan [2014] SGCA 59 at paras 19, 20, 26, 41, 42, 51, 53 to 55, 62, 67, 77 to 79, and 81. To view the judgment, click <here>.

Disclaimer: The above is provided to assist in the understanding of the Court’s judgment. It is not intended to be a substitute for the reasons of the Court. The full judgment of the Court is the only authoritative document.

'Removing HQ tax break will not turn off firms'

Straits Times
25 Feb 2015
Rennie Whang

EXPERTS are confident a move to withdraw a tax break for companies that set up headquarters here will not greatly affect Singapore's appeal to big foreign firms.

They believe the move will promote higher value-added activity from companies looking to make their headquarters here, since they can qualify for another government incentive that requires more of them.

The Approved Headquarters incentive will be withdrawn from Oct 1, but the Development and Expansion Incentive (DEI) will still be available.

Under the Approved Headquarters incentive, companies providing management, technical or other support services to network companies outside Singapore have enjoyed a 10 per cent concessionary tax rate or even tax exemption on income from qualifying headquarters activities.

The DEI also includes the criterion that a company uses Singapore as its headquarters.

Companies seeking to apply for the DEI should consider undertaking more than just management support services, said KPMG tax partner Anna Low.

Other high-value economic activities they can undertake include high-tech manufacturing, technical services, supply chain management and innovation-related activities.

"The change is a rationalisation of incentives. The Government is clearly looking for new and incremental value-creation activities," said Ms Low.

"Foreign companies looking to set up headquarters in Singapore can still consider seeking support under the DEI, while local companies looking to use Singapore as their headquarters to expand regionally or globally can consider applying for the newly introduced International Growth Scheme," said Ms Low.

Under the DEI, the concessionary tax rate is not less than 5 per cent on income from the qualifying activities.

Mr Desmond Sim, CBRE research head for South-east Asia, believes Singapore remains attractive for many reasons. "The underlying qualities of Singapore - good workforce, low corporate tax rate, our status as regional hub for various industries - will still bring companies in," he said.

"The Approved Headquarters incentive is a good sweetener, but its removal will certainly not drive companies away."

The change could dampen office demand, but multinational firms can still tap into many other tax incentives, said Ms Christine Li, Cushman and Wakefield's research head.

"Many other factors, such as the ease of doing business, (also) contributes to the decision to set up or relocate the headquarters to Singapore."

wrennie@sph.com.sg

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Planning Act - Planning (Subdivision of Land and Building - Authorisation) (Amendment) Notification 2015 (S 68 of 2015)

377A: Law and Morality

Legislation
23 Jan 2015

Fortifying Singapore's four pillars of social security

Business Times
24 Feb 2015

THE Golden Jubilee budget presented yesterday by Finance Minister Tharman Shanmugaratnam is, more than anything else, another big step towards providing greater social empowerment, progressivity, protection and inclusiveness which have come to be the hallmarks of economic policy-making in recent years.

As Mr Tharman noted, Singapore has, over the last decade, come a long way in strengthening the "four pillars" of its social security system - home ownership, CPF, healthcare assurance and Workfare.

In this budget, he has made fortifications. First, he has added a "Silver Support Scheme" which will provide income support to the elderly to the tune of S$600 every quarter on average, per recipient. He has enhanced the CPF system, by increasing mandated contributions during working years, including for older workers. He has also raised interest rates for smaller CPF balances such that some 80 per cent of CPF members will earn at least 5 per cent on their retirement savings, which is remarkable at a time of near-zero interest rates for all major currencies - and the Singapore dollar. There are more subsidies for education as well, including pre-school.

The corporate sector will heave a collective sigh of relief on two counts in particular. First, that the Wage Credit Scheme - which subsidises wage increases for workers paid S$4,000 and below - will be extended (albeit in a slightly diluted form) for another two years. And second, that this year's increases in most foreign worker levies will be deferred, which will enable labour-starved companies to breathe easier after suffering five years of progressively higher levies. Hopefully, this measure will reinvigorate the supply side of the economy and help boost economic growth as well, even if modestly.

The budget also contains some generous incentives but companies will have to do their bit to make the most of them. Case in point: the Productivity Innovation Credit (PIC) scheme (which offers funding for various qualifying activities) now offers more for innovation - for which it has, up to now, not been much used. Innovation will be pragmatically interpreted to include not just major technological breakthroughs, which are rare, but also less dramatic but effective innovations. Companies will need to come up with innovations to benefit from this.

With the greater emphasis on innovation, hopefully the administration of the PIC will be transferred to agencies better placed to assess innovative practices, such as the Economic Development Board (EDB) or the Infocomm Development Authority (IDA), rather than the Inland Revenue Authority of Singapore (Iras), which has other competencies.

What will also help with both productivity aGolden Jubilee budget presented yesterday by Finance Minister Tharman Shanmugaratnam is, more than anything else, another big step towards providing greater social empowerment, progressivity, protection and inclusivenessnd innovation is the emphasis on skills development - another important element of Mr Tharman's budget. The proposed SkillsFuture Credit, under which citizens will receive credits over their lifetime to spend on skill-enhancing courses tailored to their needs and talent - is a practical and imaginative idea.

Productivity link

It recognises that learning does not stop at school or university, that it should be open to people of all ages, at any stage of their careers, and that in our time, education and training can be provided in a variety of ways, including online. The link with productivity is clear: no matter what incentives the government provides to companies to be more productive, without access to appropriately skilled workers (and given restrictions on hiring foreign workers), these incentives are unlikely to be very effective.

The impressive panoply of social measures unveiled by the Finance Minister - not only in this budget but also in previous years - are costly, and this is reflected in the numbers. Between FY2005 and FY2015, total social expenditure has gone up 2.7 times. Expenditure on health has gone up more than five times, with much of the increase coming over the last three years, while that on education has roughly doubled. In the economic sphere, expenditure on transport has gone up more than five-fold as well.

With generous health and education subsidies already in place (and which will be difficult to roll back), Singapore could be locked into high social spending for a long time to come. Singapore's tax revenues are only 14 per cent of GDP. In other countries that provide social benefits, the ratio ranges from around 27 per cent in South Korea to as much as 46 per cent in Sweden - where benefits are high and universal. While Singapore cannot go to that extent, there is little doubt that its tax to GDP ratio is on the low side for a country with a social benefit system in place. The government will be increasingly under pressure to find new sources of revenue.

In this budget, Mr Tharman has proposed two major revenue-enhancing measures. One is to include Temasek Holdings in the net investment return (NIR) framework, which means that the government can spend based not on actual investment income but on 50 per cent of expected long-term returns, including both realised and unrealised capital gains. How this would work needs more elaboration. How will long-term returns be calculated for an equity-based portfolio? Will a 50 per cent cushion be enough? If unrealised capital gains are not subsequently realised, or worse still, turn into losses, will there be adjustments in net investment returns in future years, or will Temasek and other contributors be "refunded" what they paid out but did not earn?

The other big revenue-raising measure in this budget is an increase in the top marginal rate of personal income tax to 22 per cent, from 20 per cent and smaller adjustments for others in the top 5 per cent of income earners.

This greater progressivity should be acceptable and even welcome, especially given that the top 5 per cent have been the biggest beneficiaries of growth in both wealth and income over the last decade. However, as Mr Tharman pointed out, Singapore cannot keep raising rates at the top without courting the danger of losing tax competitiveness.

Down the road, Singapore will have to find alternatives. For now, a model of direct taxation where 90 per cent of taxpayers pay only 20 per cent of taxes and the majority of the population does not pay any tax may be manageable. But in the future, and if the experience of other countries is any guide, this might need to be revisited.

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Planning Act - Planning (Child Care Centre - Change in Use Lodgment Authorisation) (Amendment) Notification 2015 (S 67 of 2015)

Supreme Court Note: Woo Kah Wai and another v Chew Ai Hua Sandra and another appeal [2014] SGCA 41 (whether an offer to purchase an option to purchase is legally enforceable)

Supreme Court Note
23 Jan 2015

The Court of Appeal has clarified that an offer to purchase an option to purchase is legally enforceable. In this case, the Appellants were the Vendors of a Property while the Respondent was the Purchaser. The Purchaser made a written offer to the Vendors (“the Written Offer”) with the aim of purchasing the Property. The Written Offer dated 10 February 2010 provided a number of terms and conditions, one of which was that the option period was to be “three days”.

The Written Offer was handed over by the Purchaser’s estate agent to the Vendors’ estate agent on 11 February 2010 together with a cheque for $9,200 being the 1% option money (“the Option Money”). An option to purchase, prepared by the Vendors’ estate agent, was dated and signed by one of the Vendors, on 11 February 2010 (“the Option”). The exercise date stated in the Option (the last date for exercising the Option) was on or before 13 February 2010, at 4pm. When the Purchaser’s estate agent went to collect the Option on 12 February 2010, he told the Vendors’ estate agent that there was a mistake because the exercise period was too short.

On 13 February 2010, the Vendors’ estate agent informed the Purchaser’s estate agent that the Vendors were not agreeable to amending the Option. By the time the Purchaser’s estate agent finally collected the Option that day and handed it to the Purchaser on 13 February 2010, the time for exercising the Option had already expired. On 17 February 2010, the Purchaser and her estate agent tried, through their solicitor, to exercise the Option but were unable to do so as the Vendors’ solicitor’s firm was closed. Another attempt to exercise the Option was made on 18 February 2010 but this was rejected by the Vendors’ solicitor on the ground that the Option had already expired. The Purchaser then commenced court proceedings in June 2011 seeking, amongst other things, specific performance of the sale of the Property.

The Court of Appeal clarified that in principle and in general, a contract to grant an option to purchase a property on certain specified terms is enforceable as long as the requirements for an enforceable contract are present. Letters setting out offers to purchase a property on certain terms such as the Written Offer can be motivated by an intention to create legal relations. In this case, the Written Offer was an offer to acquire an option to purchase the Property on certain specified terms which was capable of acceptance and which, on the evidence, was accepted. Further, the terms of the Written Offer were not ambiguous. Consequently, there was no uncertainty over the terms of the pre-option contract that resulted from the acceptance by the Vendors of the Written Offer. A pre-option contract was therefore formed and enforceable against the Vendors.

At Woo Kah Wai and another v Chew Ai Hua Sandra and another appeal [2014] SGCA 41, paras 51, 58 to 62, 73 to 78, 80 to 84, 87 and 88.

Disclaimer: The above is provided to assist in the understanding of the Court’s judgment. It is not intended to be a substitute for the reasons of the Court. The full judgment of the Court is the only authoritative document.

Tax incentives for S-Reits extended but not stamp duty remissions

Business Times
24 Feb 2015
Lee Meixian

[Singapore] INCOME tax and GST concessions for Singapore real estate investment trusts (S-Reits) will be extended for five more years, but stamp duty concessions for the purchase of local properties will be allowed to lapse after March this year, said Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam on Monday. This is because the stamp duty concessions "were intended to enable the industry to acquire a critical mass of local assets as a base from which the Reits can expand abroad, (and) this has been achieved", he said in his Budget speech.

With the extensions, Reits will continue to enjoy tax exemption on qualifying foreign-sourced income, a reduced withholding tax of 10 per cent (from 17 per cent) on distributions to foreign institutional investors, and GST remissions on business expenses for Reits with overseas assets. (The latter also applies to listed registered business trusts in the infrastructure, ship leasing and aircraft leasing sectors.)

The finance ministry further announced changes to facilitate fund-raising by these Reits and business trusts through their special purpose vehicles (SPVs). From this April until March 2020, they will be allowed to claim GST on business expenses incurred to set up SPVs that are used solely to raise funds, as well as GST on the business expenses of such SPVs. This is especially relevant since Hong Kong, a close competitor for similar listings, does not have a GST regime, said Teo Wee Hwee, real estate tax leader at PwC Singapore.

All these moves are aimed at promoting Reit and business trust listings in Singapore amid intensifying competition in Asia as various countries develop and improve their own Reit and business trust frameworks.

Asia Pacific Real Estate Association chief executive Peter Verwer noted that many Asian governments, including those of China and India, are looking to chase down Singapore's lead in financial services. "Today's statement by the Singapore government keeps it ahead of the pack," he said.

The industry welcomed the extensions and said the removal of stamp duty concessions for local acquisitions will have limited impact on S-Reits, since most are already acquiring abroad for better returns on investments. Many have also braced themselves for the possible removal in the run-up to the Budget, they said.

DBS analyst Derek Tan said removing the stamp duty concession will add about 3 per cent to the cost of acquiring local assets. "Industrial Reits tend to have more domestic-oriented portfolios, so their pace of acquisitions may slow and yields may dip. They will have to negotiate harder," he said, citing Ascendas Reit, Mapletree Industrial Trust, Viva Industrial Trust, Mapletree Commercial Trust, Frasers Centrepoint Trust, CapitaMall Trust and CapitaCommercial Trust as some examples of Reits with wholly local assets.

According to Christine Li, director of research at Cushman & Wakefield, of the top 10 investment deals last year, six involved Reits buying properties locally - translating to about S$4 billion in transaction value, or two-thirds of the total investment value of the top 10 leasing deals.

PwC's Mr Teo noted that there are other ways to acquire local properties without paying substantial stamp duties. "If you can't buy the asset, you may have the option of buying the company that owns the asset, since most real estate is held using special purpose vehicles. By doing that, you should end up paying a substantially lower stamp duty of 0.2 per cent based on the net asset value of the company."

Such share deals are common in Singapore, particularly for sophisticated and institutional investors, but less so for Reits since they enjoy stamp duty remissions.

However, unlike Reits which enjoy tax transparency, these companies will have to pay tax on their rental income. Even so, there are ways to achieve tax transparency - by converting these companies to Limited Liability Partnerships, which are tax transparent in Singapore, for example. Such conversions may also qualify for stamp duty relief. "Then it's as good as the Reit owning the property directly," said Mr Teo.

leemx@sph.com.sg

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Planning Act - Planning (Changes in Use - Lodgment Authorisation) (Amendment) Notification 2015 (S 66 of 2015)

Latest developments: Inability to remember material facts; sustainability reporting; eMarketing; negligent driving; Security of Payment Act; easements

Business
23 Jan 2015

CPF changes to boost savings and returns

Business Times
24 Feb 2015
Claire Huang

Initiatives will help workers meet their basic needs in later years

[Singapore] THE government will roll out substantial changes to the Central Provident Fund (CPF) scheme that will help working Singaporeans, especially the lower and middle-income groups, save more for their retirement and earn more returns, to help them meet their basic needs in later years.

From Jan 1 next year, the CPF salary ceiling will rise to S$6,000 from S$5,000 to help the middle-income save more in their working years. The higher ceiling, which was last raised in 2011 from S$4,500, is expected to affect at least 544,000 CPF members.

The move, said Tharman Shanmugaratnam, Deputy Prime Minister and Finance Minister in his Budget 2015 speech on Monday, will mean that a 45-year-old worker who earns S$6,000 or more now, will save an additional S$60,000 by age 65.

Concurrently, the contribution cap of the Supplementary Retirement Scheme (SRS) will go up to S$15,300 from S$12,750 for citizens and permanent residents, and to S$35,700 from S$29,750 for foreigners. Limits on tax reliefs for CPF and SRS contributions will be adjusted accordingly.

Wu Soo Mee, EY human capital partner, said that raising the CPF ceiling now could help defray medical costs, among other things.

The higher ceiling will help the lower and middle-income groups attain the full retirement sum of S$161,000, said Marcus Kok, a principal pension consultant at PwC Singapore.

To encourage Singaporeans to retain savings in their CPF accounts, the government will pay from next year one percentage point more in interest on the first S$30,000 CPF savings from the age of 55 - on top of the one point extra interest for the first S$60,000. It would mean that the first S$30,000 in the Special, Retirement or Medisave accounts can earn up to 6 per cent interest. The existing basic interest rate for the Special, Retirement and Medisave accounts is 4 per cent, while the rate for the Ordinary Account is 2.5 per cent.

From January 2016, those above 50 to 55 will have their contribution rates raised by two points - which will match the level of the younger workers at 37 per cent - with employers and employees sharing the increase equally. Employers will have to contribute one point more for workers aged above 55 to 60, and half a point more for those aged above 60 to 65.

While these initiatives were generally welcomed by analysts and the labour movement, higher contribution rates is an area that has been met with resistance by employers in the past. Daniel Ho, director of taxes at Deloitte Singapore, said that while employers appear to have suffered another whammy in trying to cope with rising business costs, the extension of the enhanced Temporary Employment Credit scheme should help offset the impact for the next three years.

To get companies to re-hire older workers beyond the stipulated age of 65, the government will be spending S$50 million to provide employers with an additional Special Employment Credit (SEC) of up to 3 per cent of wages for those who are 65 and above in 2015. This is on top of the 8.5 per cent wage offset that employers would receive in 2015. The government will also provide a S$500 million top-up to the SEC fund to meet the needs of the scheme until it expires in 2016. More details will be provided at the Ministry of Manpower's Committee of Supply debate.


KEY POINTS

• From Jan 1, 2016: CPF income ceiling to go up from S$5,000 to S$6,000; Higher Supplementary Retirement Scheme contribution cap
• Higher contribution rates of between 0.5 and 2 percentage points for workers aged 50-65
• Additional one per cent extra interest on first S$30,000 CPF balances from age 55

huangjy@sph.com.sg

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Planning Act - Planning (Development of Land - Lodgment Authorisation) (Amendment) Notification 2015 (S 65 of 2015)

A new chapter in Singapore's transfer pricing regime

Business
23 Jan 2015

Sweetening the deal for firms to innovate and expand abroad

Business Times
24 Feb 2015
Jamie Lee

Government to introduce two new schemes, boost existing incentives

[Singapore] THE government is pushing more Singapore companies to go overseas and innovate - and will introduce two new schemes, while amping up existing incentives, to make it happen.

This comes as Tharman Shanmugaratnam, Deputy Prime Minister, and Minister of Finance, on Monday said that the lag in productivity growth resulted mainly from the poor performance of domestic-oriented sectors.

Over the past five years, outward-oriented sectors posted productivity growth of over 5 per cent per year on average. By comparison, those who have been focused on the local turf registered productivity growth of less than one per cent.

"Budget 2015 will sharpen support to businesses that are making significant effort to raise productivity, especially by innovating and internationalising," said Mr Tharman.

To nudge more companies to explore overseas markets, the government will offer a new 10 per cent concessionary tax rate on certain income of larger companies that are expanding abroad. Details have not been announced, but Mr Tharman said that such companies must continue to anchor their key business activities and headquarters in Singapore.

On top of this, the government will raise its support under its internationalisation grants to 70 per cent for all forms of overseas activities for three years. As it is, 700 projects are expected to qualify for the revised scheme.

The government will also broaden a tax incentive - which now offers a 200 per cent tax deduction against qualifying market expansion activities - to cover manpower expenses. This effectively means the scheme could cover salaries incurred for Singaporeans posted overseas, said Mr Tharman.

These incentives to push companies beyond Singapore are expected to cost S$240 million, he added.

To ensure that homegrown firms will be able to compete effectively overseas, the government will boost incentives for companies scaling up through acquisitions. One move is to raise the tax allowance for acquisition costs from the current 5 per cent to 25 per cent of the acquisition value.

Besides this, companies will be able to claim benefits for acquisitions that translate to a 20 per cent shareholding in the target firm, down from the 50 per cent threshold now. "This will be especially helpful for SMEs, who may not be able to acquire large stakes in their expansion strategies," said Mr Tharman.

To boost innovation, Mr Tharman tweaked existing grants for SMEs, and ramped up financing for new firms.

SMEs that apply for the Capability Development Grants will go through a simpler process if their projects are valued below S$30,000. Funding support of up to 70 per cent of project costs will also be extended till 2018.

Mr Tharman introduced a venture debt risk-sharing programme, under which the government will provide 50 per cent risk-sharing with selected financial institutions offering venture debt over an initial two years. He expects to "catalyse" some 100 venture debt loans, totalling about S$500 million, during this time.

Eric Tham, head of group commercial banking at UOB said that this risk-sharing programme is a "forward-thinking move", as Singapore becomes an international hub for high-tech ventures.

Likewise, Anuj Kagalwala, financial services tax leader at PwC Singapore, supported the move, as it speeds up the search for "Singapore's very own Alibaba and Facebook".

Mr Tharman also increased the co-investment cap for both the Startup Enterprise Development Scheme and Business Angel Scheme.

And with this emphasis on innovation, the government will boost R&D funding, and for this, the National Research Fund will be topped up by S$1 billion this year, said Mr Tharman.

leejamie@sph.com.sg

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Planning Act - Planning (Development of Land Authorisation for Housing and Development Board and Jurong Town Corporation) (Amendment) Notification 2015 (S 64 of 2015)

Supreme Court Note: TYC Investment v Tay Yun Chwan Henry [2014] SGHC 192 (implication of term into divorce settlement agreement to regulate exercise of director’s powers)

Supreme Court Note
21 Jan 2015

The principal dispute in these proceedings, between the only two directors (“HT” and “JC”) of the first Plaintiff (“TYC”), concerned their right to approve payments by TYC to its creditors. TYC was a family holding company. HT and JC, who were formerly husband and wife, held 90% of the voting rights in TYC. As part of the divorce settlement, three agreements were entered into by HT, JC and TYC (“the DOS”, “the SSD” and “the TYC Deed”; collectively, “the Divorce Settlement Agreements”). Pursuant to cl 10 of the SSD, HT and JC have the power to prevent TYC from making payment by either refusing to sign a cheque or a corresponding approval voucher (“the Payment Clause”).

JC exercised her right under the Payment Clause by refusing to approve a number of payments by TYC. This was then met by an extraordinary general meeting (“the EGM”) called by HT. The resolutions passed at the EGM – by HT and the couple’s son (together they held a majority of the votes) – included granting HT the authority to: (a) appoint solicitors to act for TYC and commence court proceedings against JC; and (b) unilaterally sign cheques and vouchers to make payments on TYC’s behalf.

TYC then commenced proceedings against HT and JC, seeking declarations from the court that cheques signed by HT for payment to creditors were valid and binding, notwithstanding the absence of JC’s approval. TYC also sought an order that JC specifically perform her contractual obligations under the Divorce Settlement Agreements based, in particular, on her obligation under an implied term in the SSD that prevented her from exercising her right under the Payment Clause dishonestly, for an improper purpose, capriciously or arbitrarily (“the Implied Term”).

One of the issues that arose was the right of shareholders to appoint solicitors to commence proceedings. The High Court clarified that where a board was deadlocked in relation to the matters raised at the EGM and the deadlock could not be broken in some other way under the company’s constitution, it was necessary for the shareholders to have limited reserve powers which, when exercised through the EGM, gave them the power to appoint solicitors to commence proceedings. Thus, in this case, the shareholders, namely HT and the couple’s son, were permitted to appoint solicitors to commence proceedings for the limited purpose of determining the rights and obligations of the parties under the Divorce Settlement Agreements.

The shareholders’ reserve powers, however, did not include the power, authorised via the EGM, for HT to unilaterally sign cheques on TYC’s behalf. This would have been inconsistent with the Payment Clause which required both HT and JC to approve payments by TYC.

The High Court also held that it was not necessary to imply into the SSD the Implied Term. The gap caused by the Payment Clause did not undermine the efficacy of the SSD (or the TYC Deed) in relation to the approval of payments because the gap was adequately covered by the existing directors’ duties imposed on HT and JC in their capacity as directors of TYC.

At TYC Investment Pte Ltd and others v Tay Yun Chwan Henry and another [2014] SGHC 192 at paras 85, 108 to 123, 185 to 192, 211 and 212.

Disclaimer: The above is provided to assist in the understanding of the Court’s judgment. It is not intended to be a substitute for the reasons of the Court. The full judgment of the Court is the only authoritative document.

Go forth and multiply: Encourage internationalisation of Singapore businesses

Business Times
24 Feb 2015
Russell Aubrey & Sandie Wun

BUSINESSES of all sizes should be rejoicing over the goodies distributed in this year's Budget announcement. Particularly, the measures targeted at helping Singapore companies internationalise send a clear message that local businesses need to look beyond the domestic market in order to achieve breakthroughs in growth.

Foreign revenue generated by the top 1,000 companies in Singapore by revenue (Singapore 1000) has increased steadily from S$149.9 billion in 2011 to S$223.9 billion in 2014. This upward trend is similarly seen in the SMEs. The top 50 SMEs ranked as having the highest overseas turnover derived revenue of S$1.78 billion in 2014, a 29 per cent increase from S$1.38 billion in 2011.

With the expected formation of the Asean Economic Community (AEC) by the end of 2015, it will not be a surprise that international revenues will continue along the upward trend.

To further encourage internationalisation by Singapore companies big and small, three measures, costing the government S$240 million in total, were introduced.

Firstly, there would be an increase in support to 70 per cent of grants awarded by IE Singapore. Secondly, double tax deductions will be enhanced to cover salaries paid to Singaporeans working overseas. Lastly, a new tax incentive, the International Growth Scheme with concessionary tax rates on incremental income, will be accorded to qualifying companies that embark on a journey to internationalise.

It remains to be seen the conditions that need to be met by companies to enjoy these benefits. There was also no sunset clause announced by the finance minister on the International Growth Scheme. As with all other tax incentives, we expect that there will be a sunset clause, which we hope will take into consideration that the internationalisation of a company is not a short-term effort that reaps rewards immediately, but one that will likely yield results and returns only after a period of time.

Recognising that mergers and acquisitions are possibly a faster strategy by companies to acquire scale and forge alliances both locally and internationally, the current Mergers and Acquisition (M&A) allowance will be extended for another five years and will be enhanced to 25 per cent of the value of a qualifying investment, up from the 5 per cent threshold previously allowed.

The maximum tax deduction of S$5 million is unchanged though. The 50 per cent shareholding condition will also be relaxed to allow for the M&A allowance to be accorded so long as there is an acquisition of at least 20 per cent shareholding.

The reduction in the shareholding threshold is a welcomed enhancement on two fronts. It makes the now increased M&A allowance more accessible to companies where a less than 50 per cent stake is acquired. The enhancement also makes the M&A allowance more accessible to SMEs in particular, making the adoption of M&A as a strategy to internationalise more attractive.

The changes to the M&A Scheme are aligned with the clear theme in this year's Budget on assisting SMEs and making their access to fiscal assistance for expansion easier.

But this year's Budget is not just about focusing on companies - in fact, it is one of the most holistic, touching on every aspect of the economy and life, from overseas growth to continued education through the years to social support for various segments of the society. It is a special SG50 Budget indeed.

As Education Minister Heng Swee Keat, who is also chairman of the SG50 Steering Committee, said: "SG50 is about celebrating the enduring values that we share as Singaporeans, values that undergird the Singapore Spirit . . . reflecting on how far we've come as a nation in the last 50 years, celebrating where we are now, and committing to an even better next 50 years."

In the same light, as much as Budget 2015 is about reflecting on our achievements to date as a nation and redistributing the fruits of our nation's labour back to our people, it is also about propelling this little red dot to greater heights and further beyond the shores of Singapore.

It is a truly a progress plan that underpins Singapore's readiness for her next 50 years of successful nation-building.

  • The writers are respectively partner and director, transaction tax, at EY in Singapore

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Attorney-General (Additional Functions) Act 2014 - Attorney-General (Additional Functions) Act (Amendment of Schedule) (No. 2) Order 2015 (S 63 of 2015)

IPOS Case Summary: Intel Corporation v Intelsteer [2015] SGIPOS 2 (whether grounds for invalidation under ss 23(3)(a)(i), (3)(a)(iii) and (3)(b) Trade Marks Act met)

Judgments
21 Jan 2015

Higher tax rates for top 5% of income-earners

Business Times
24 Feb 2015
Siow Li Sen

But this is offset to varying extent by the rise in CPF salary ceiling to S$6,000

[Singapore] THE rich will have to pay more taxes under the redistributive Budget as Singapore continues to ensure a fair and equitable system of taxes and benefits.

The government will raise the marginal tax rates for the top 5 per cent of Singapore's income-earners though the impact is offset somewhat by the increase in CPF salary ceiling.

The top marginal rate will rise by two percentage points, from 20 per cent to 22 per cent for the highest income earners, with a chargeable income above S$320,000, said Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam on Monday.

There will also be smaller adjustments made to raise income tax for the others in the top 5 per cent bracket. These changes will apply starting with income earned in 2016 and on taxes to be paid in 2017. The move is expected to raise additional revenue of S$400 million a year when it comes into effect.

"This tax increase for high-income earners will enhance progressivity and strengthen future revenues. This is a calibrated move. We have assessed that it should not significantly dent Singapore's competitiveness," said Mr Tharman.

Tax rates are not the only way Singapore stays competitive, he said, noting that the country's other key strengths include a culturally diverse and cohesive society, a family friendly environment, clean air especially compared to other Asian cities, and a world-class healthcare system.

Singapore's tax philosophy is to keep the tax burden on the middle-income low, so that they get to keep what they earn, as much as possible.

"In several advanced countries, taxes on the middle-income are much higher than in Singapore, in order to fund higher social benefits: not just for the lower-income but often for everyone else including the upper-middle income and the rich.

"Our philosophy is to keep the burden on the middle-income low, and target benefits at the most important needs of the poor and middle-income groups. Taken overall, this is a better deal for middle-income households," said Mr Tharman.

"We have designed our system such that we have lower overall taxes than most countries, but nevertheless maintain a highly progressive regime," he said.

"The higher-income group makes a significant net contribution into the system, which enables the lower-income group in turn to get significantly more benefits than the taxes they pay."

In other words, when all the taxes - GST, income, property and other taxes - are added up and compared to benefits received, the low income group gets more benefits than the taxes they pay, while the high income tax pays more taxes than benefits received, he said.

Still, the higher income tax rate is far from punitive. And when the increase in CPF salary ceiling from the S$5,000 to S$6,000 is factored in, the net effect is an increase in total income for someone earning S$250,000.

According to Wu Soo Mee, EY tax partner, human capital, advisory services, for someone earning S$250,000 there is an increase of tax of S$145 under the new tax rate table, after reliefs. "The increase in tax would have been higher had it not been for the higher CPF relief due to the increase in CPF contributions (arising from the increase in CPF salary ceiling)," said Ms Wu.

As the annual employer's CPF contribution is S$2,040 higher, overall the employee has an increase of total income (net of tax salary plus employer's CPF) of S$1,895, she said.

Ms Wu calculated that the increase in CPF contributions is neutralised when income rises to S$400,000.

"The level of income at which the increase in employer's contributions will be wiped out by the increase in tax liability is S$403,136," she said.

lisen@sph.com.sg

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Pioneer Generation Fund Act 2014 (Act 43 of 2014)

Patent Prosecution Highway: An update

Business
21 Jan 2015

Spa package refund not assured in case of serious illness

Straits Times
24 Feb 2015
Cheryl Faith Wee

WHEN a person becomes so seriously ill that she is unable to use up a spa or facial package bought earlier, getting a refund from the beauty salon is not a given.

A customer of a skin treatment company learnt this hard truth last year. She was diagnosed with breast cancer and was advised by her doctors to stop facial treatments immediately.

The customer, who declined to be named for privacy reasons, still had $5,995 worth of facial sessions left in her package, but the company was willing to refund only $3,800. She went to the Consumers Association of Singapore (Case) for help and managed to get back $5,500.

She is among a small number of people who ask for refunds on their beauty packages because of serious medical conditions, according to the 10 beauty and wellness companies The Straits Times contacted. Some of them get such requests only once every few years.

Serious medical conditions include critical skin conditions, cancer and terminal illnesses.

Medical reasons, however, do not guarantee a refund.

"Unless it is contractually provided for, it is not mandatory for the company to provide the customer with a refund in spite of the medical condition," said Mr Benjamin Cheong, a partner at law firm Rajah & Tann.

Spa and wellness companies with CaseTrust accreditation from the consumer watchdog will offer a full refund within a cooling-off period of five working days. For refund requests due to serious medical conditions which happen after the cooling-off period, most firms usually allow them out of goodwill and on a case-by-case basis. Five of the 10 companies interviewed require a medical certificate of proof.

Said Mr Edward Tong, honorary secretary of the Spa and Wellness Association (Singapore): "In terms of compassionate consideration, I would think most businesses will consider if the reason provided is legitimate and factual. Most forward-looking businesses want to enhance goodwill and long-term relationships with regular customers."

Beauty and slimming company Mary Chia receives three to five refund requests due to serious medical conditions every year. The firm will usually suggest alternative treatments that get the green light from the customer's doctor, or suggest transferring the remaining sessions to the customer's friend or family member.

If the customer does not agree to either of the suggestions, the firm will then require a medical statement from a doctor to decide whether to grant a refund.

"The company will, at its sole discretion, provide a refund for genuine cases," said Ms Sharon Tan, 33, the group senior marketing and business manager for Mary Chia Holdings.

Others require more details. At Global Wellness Holding - which runs Body Contour, Passage New York, and Hair Inc New York - customers seeking a refund for medical reasons have to be certified unfit by a registered medical practitioner. The doctor must also make specific reference to the treatment programme in his document.

As refunds often involve contractual and legal issues, consumers are advised to scrutinise their contract. For instance, some businesses include clauses which state that any cancellation of packages will incur administrative charges, said Case executive director Seah Seng Choon.

Others note that customers who cancel will not enjoy the discounts that come with the package - each consumed treatment will thus be charged its full price and the customer will have to pay back the difference.

"Consumers should do their due diligence and read the terms and conditions of the contract carefully before signing on the dotted line," said Mr Seah.

cherylw@sph.com.sg

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Residential Property Act - Residential Property (Fees) (Amendment) Rules 2015 (S 62 of 2015)

[INT] Roadmap to an ASEAN competition law and policy

Commonwealth
21 Jan 2015

Drone users call for less restrictive rules amid review

Straits Times
24 Feb 2015
Lester Ho

REGULATIONS for flying drones in Singapore should be streamlined and less obstructive, according to users and developers of the gadgets here.

They hope that the current review of drone regulations by the Ministry of Transport and the Civil Aviation Authority of Singapore (CAAS) will provide clearer guidelines on drone operations and include minimal restrictions.

The challenge will be to ensure that privacy and safety concerns are met without undermining innovation and development.

Currently, drone users must apply for at least one of three permits before flying them here, which can take a minimum of two weeks.

Under the Singapore Air Navigation Order, a model aircraft may not be flown within 5km of an aerodrome - such as an airport or air base - unless the operator obtains a permit.

A permit is also required for flying drones higher than 61m above mean sea level when they are 5km or more away from an aerodrome.

Such rules ensure there are safety buffers to keep unmanned aircraft clear of flight paths.

Finally, drone operators need an aerial photography licence - even if they do not plan to use cameras attached to the machines.

Drone operators say the regulations are too restrictive and bureaucratic, and make deployment and development of the technology difficult here.

Mr Rude Lee, 33, from aerial photography company Skyshot, called for the permit approval time to be reduced. "Every time we want to fly, we have to contact different departments at CAAS, the Ministry of Home Affairs and, sometimes, the air force," he said. "We have to turn away clients with last-minute requests because we won't get the permits in time."

Mr Gabriel Kang, founder of drone research firm Sensory Robotics, said: "The only people being punished are those who try to stick to the rules.

"All drones have cameras - it's a safety feature. You have to see where the drone is going as it can travel out of sight very quickly. You want to make sure it doesn't hit anything, and you can't do that without a camera to see where it is flying."

Lawyers say the review is a step in the right direction in separating regulations for manned and unmanned aircraft, which have different needs.

Technology lawyer Gabriel Voisin, from law firm Bird and Bird, said the Ministry of Transport's review shows there is an interest in drawing up a drone-friendly regulation. But he added: "The real difficulty will be to balance issues of safety, privacy and public opinion with the interest of the industry."

lesterh@sph.com.sg

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Requisition of Resources Act - Requisition of Resources Order 2015 (S 61 of 2015)

The next chapter: Singapore launches the International Commercial Court

Business
20 Jan 2015

M. Ravi taken to court over mental health

Straits Times
23 Feb 2015
K.C. Vijayan

WITH lawyer M. Ravi's mental health still in question, the Law Society is going to court to force him to get a medical examination.

Mr Ravi, 43, was ordered to stop practising by its governing council on Feb 10, following serious concerns about his mental health.

A Law Society spokesman, responding to queries by The Straits Times, explained that under the Legal Profession Act, it had to make the court application within a week of the ban, or the lawyer's suspension would automatically be lifted.

The application was filed on Feb 17, and the ban now remains until the outcome of the court hearing at least. The final decision on whether he is fit to practise will be made by the judge.

The society said earlier that Mr Ravi's ability to practise was affected as he had been diagnosed with hypomania - where overactive and excited behaviour can seriously impact a person's daily life. To get the ban lifted, he needs a medical report saying he is fit to continue as a lawyer.

"As at Feb 17, 2015 (seven days after the direction was issued), the state of Mr Ravi's medical condition remained unclear," said the spokesman, adding that the lawyer had not given the society any information that would justify lifting the ban.

The society also made clear that in making its move, it had to "consider and balance the wider interests of the public and profession against that of the individual concerned".

The ultimate aim, it said, is to find a way for Mr Ravi to manage his medical condition "that is satisfactory and workable and which, if properly complied with, may allow him to recover and return to practise".

The society, which is represented by Shook Lin and Bok lawyer Pradeep Pillai, is due to argue its case before Justice Quentin Loh tomorrow.

Mr Ravi, when contacted yesterday, said he would be applying to dismiss the application. He added that he has been voluntarily seeking treatment from a psychiatrist.

vijayan@sph.com.sg

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Medical and Elderly Care Endowment Schemes Act - Medical and Elderly Care Endowment Schemes (Approved Institutions) (No. 3) Notification 2015 (S 60 of 2015)

Singapore Law Gazette Awards 2014 - Commendation: Solicitor’s ethical duty to evaluate economics of litigation; patents and genetic testing; Deutsche Bank v Chang Tse Wen [2013] SGCA 49

Business
20 Jan 2015

Roots of international law in 1603 incident off Changi

Straits Times
23 Feb 2015
Navin Rajagobal

In recent weeks, stories about Singaporeans' knowledge of their history (or lack thereof) have been prominent in the media. Here is one event that Independent Singapore should remember.

I WOULD like to take this opportunity to highlight an important historical incident with lasting global repercussions that took place very near our island.

Few residents of Singapore would be aware of this event, and I would not blame them for this, because it occurred in 1603.

This Wednesday, Feb 25, marks the 412th anniversary of the event.

The incident I refer to happened off Singapore's upper east coast, near Changi. The Santa Catarina, a Portuguese merchant ship captained by Sebastian Serrao, was attacked and seized by smaller ships commanded by Jacob van Heemskerk from the Netherlands.

The Santa Catarina and its precious cargo of silk, porcelain, camphor and other spoils were swiftly dispatched to Amsterdam. When these were auctioned, the proceeds amounted to about �300,000, a princely sum in 17th-century northern Europe.

Naturally, the Portuguese wanted their treasure back, while many in the Netherlands were troubled by the legality and morality of the seizure.

The Dutch wished to disrupt Portuguese domination of Europe's trade with Asia as part of their continuing conflict with their former overlord, Habsburg Spain, which ruled Portugal.

But van Heemskerk's mission to Asia, meant to promote trade, was not explicitly authorised to attack Portuguese shipping, and so the assault on the Santa Catarina could be construed as piracy.

In response to the brewing domestic and international scandal, van Heemskerk's sponsor, the United Amsterdam Company, hired an up-and-coming young lawyer named Hugo Grotius (1583-1645) to draft a paper that would defend the seizure of the Santa Catarina.

Grotius shrewdly justified the incident off Changi by claiming that van