Settlement of Malayan Railway land case 'points way to handling disputes'

Observers say process of arbitration shows respect for rule of law

Diplomatic and legal observers have welcomed the decision by Singapore and Malaysia to accept the outcome of an international tribunal on a development charge on former Malayan Railway land in Singapore.

They cited how it reflected respect for third-party arbitration to resolve knotty issues and set the momentum for bilateral cooperation to strengthen further.

Former Singapore high commissioner to Malaysia K. Kesavapany told The Straits Times: "At a time when maritime and territorial disputes are on the rise in the region, this is a salutary example of the manner in which such disputes can be resolved."

He said putting the matter through third-party adjudication to resolve the matter was possible because of the cordial relations between both neighbours.

Malaysian Foreign Minister Anifah Aman also alluded to these ties, saying the agreement by both to abide by the decision was a major step to closer cooperation. "The understanding between both prime ministers is very good... We believe this is the way forward in dealing with disputes," Mr Anifah said.

On Thursday, an international arbitral tribunal decided that Malaysia-Singapore joint venture company M+S need not pay a development charge on three parcels of former railway land. The charge is imposed on the enhancement in land value, and Malaysia disagreed with Singapore that it had to be paid on these plots.

Prime Minister Lee Hsien Loong said Singapore fully accepted the tribunal's decision and he was happy the issue could be resolved impartially and amicably.

Professor Robert Beckman, director of the Centre for International Law at the National University of Singapore, said he was pleased to read PM Lee's statement. "This shows respect for the rule of law and for independent third-party adjudication and it is a good example for the region as a whole," he said.

"This is how mature and responsible states handle international dispute settlement. They put their cases before a tribunal, accept the results, and move on."

Mr Alvin Yeo, MP and member of the Government Parliamentary Committee for Defence and Foreign Affairs, felt the outcome was "proof that the consensual approach to resolving differences in views can result in a 'win-win' situation".

"Any loss of revenue from the development charge would be more than made up (for) by not just the higher share of profits that will accrue to the Singapore side, but from the friendly relationship which is vital for any partnership to succeed," he added.

Former Singapore foreign minister George Yeo said in a Facebook post: "Disappointed that Singapore lost the case but stakes in good bilateral relations are much greater."

Dr James Chin, government studies director at the Jeffrey Cheah Institute on Southeast Asia, said it was a positive development at a time when both countries are enjoying very good ties.

Mr Wong Chen, head of investment and trade for Malaysia's opposition Parti Keadilan Rakyat, said the decision by both sides was honourable, but called on the Malaysian government to be transparent on any gains accrued from M+S as it originated from a swop of Malaysian land.

waltsim@sph.com.sg

shannont@sph.com.sg