Dispute management protocol launched to minimise delays in large infrastructure projects

SINGAPORE - To help parties involved in infrastructure projects to manage disputes and minimise time and cost overruns, a dispute management protocol has been launched by the Ministry of Law.

The protocol was announced on Tuesday (Oct 23) by Finance Minister Heng Swee Keat at Enterprise Singapore's 8th Asia-Singapore Infrastructure Roundtable, as part of efforts to establish Singapore as the infrastructure hub of Asia.

Mr Heng also launched a one-stop platform called Infrastructure Asia, which will bring together different infrastructure players in the ecosystem.

Said Mr Heng: "Infrastructure demands are large. The Asian Development Bank (ADB) estimates that from 2016 to 2030, infrastructure needs for Developing Asia will reach US$26 trillion (or US$1.7 trillion per year).

"Singapore hopes to contribute to the global infrastructure effort, especially here in Asia, by leveraging the numerous players across the infrastructure value chain that are present here."

Singapore hopes to find new ways to mitigate risks and improve the bankability of infrastructure projects, said Mr Heng.

The new Singapore Infrastructure Dispute-Management Protocol (SIDP) has thus been launched. Under this protocol, parties will from the start of the project appoint a Dispute Board comprising up to three neutral professionals who are experts in fields such as engineering, quantity surveying and law.

The board will follow the project from its start to the end and proactively help to manage issues that may arise, through dispute avoidance and resolution processes.

Said Mr Heng: "The SIDP takes a more preventive approach by pro-actively managing differences and disputes using an array of dispute resolution options throughout the project, and prevents them from snowballing."

He added that the protocol leverages Singapore's trusted legal system and expertise in dispute resolution.

In its statement, the Ministry of Law noted that as infrastructure projects are typically complex and involve multiple parties, differences and disputes are sometimes unavoidable and can result in delays and higher costs, if not managed well.

For example, it was found that infrastructure, mining and oil and gas projects have on average cost 80 per cent more than budgeted and run 20 months late, it added.

In the area of arbitration, Singapore already has 452 cases worth US$4 billion filed with the Singapore International Arbitration Centre in 2017.

Out of these cases, over 80 per cent were international in nature.

In his speech, Mr Heng noted that the new Infrastructure Asia, which is set up by Enterprise Singapore and the Monetary Authority of Singapore, will help to support the development of infrastructure in Asia.

"Through platforms such as Infrastructure Asia, partners such as MDBs (Multilateral Development Banks) and private capital institutions could find more efficient ways to participate in the regional infrastructure development to enable further growth in Asean," he added.

Mr Seth Tan Keng Hwee, executive director of Infrastructure Asia, said it will also offer advice to countries and work with them on capacity building.

He said: "With better knowledge, skills and resources, we can improve project feasibility and bankability, enabling project leads to become viable projects."