SINGAPORE - The economic impact of Covid-19 is poised to result in a spike in infrastructure sector squabbles and cross-border insolvencies, "dispute hot spots" which may land in the Singapore International Commercial Court (SICC).
Chief Justice Sundaresh Menon on Wednesday (March 10) said the SICC is well positioned to deal with cross-border insolvencies, which are expected to surge by as much as 26 per cent due to the economic effect of the pandemic.
But he added it is also timely to think how it can better address the needs of parties in high-stakes infrastructure disputes, which tend to involve multiple parties from different jurisdictions.
The Chief Justice was addressing about 300 participants, including judges and local and international experts, at a virtual symposium to discuss the latest trends and developments in international commercial litigation.
In his opening remarks, Chief Justice Menon touched on two areas - infrastructure disputes and cross-border insolvencies - which he said seemed poised for significant expansion.
The Chief Justice noted that the Asian Development Bank estimated that Asia will need some US$26 trillion (S$35 trillion) in infrastructure investment up to 2030.
China's Belt and Road Initiative, which now involves more than 2,000 projects valued at over US$2.4 trillion, will account for some of this, he said.
"While we might reasonably expect a lull in enthusiasm for new projects in the immediate aftermath of the pandemic, the crisis seems certain to drive a spike in disputes arising from existing projects as construction programmes are delayed, suspended, renegotiated or even terminated," he added.
He said international commercial courts like the SICC, which was set up in 2015, offered advantages over international arbitration in resolving infrastructure disputes.
For one, such courts boast specialised benches of internationally renowned jurists for those who want to avoid potential concerns associated with party-appointed arbitrators, he said.
"We should build on these advantages, and think about new ways in which the SICC can better address the needs of users in this sector," he said.
One issue that could be discussed further is the development of specialised procedural rules tailored to the specific needs of infrastructure and construction disputes.
As for cross-border insolvencies, he noted that Singapore's restructuring and insolvency legislation was consolidated under the Insolvency, Restructuring and Dissolution Act last year, in what he described as a "game changer".
He said the SICC is also well suited to handling restructurings involving debts governed by foreign laws.
"SICC judges hail from a spectrum of jurisdictions and legal traditions, which is a particular advantage in Asean, which itself features a diverse range of legal cultures," added the Chief Justice.
In his speech, he noted a trend of parties turning to non-adversarial processes such as mediation to resolve their disputes as budgets continue to shrink given the bleak economic outlook.
Given the trend towards "holistic dispute management", he questioned whether international commercial courts should continue to position themselves as offering "a solely adjudicative process of dispute resolution".
The SICC symposium brings together chief justices, judges and legal luminaries in the field of international commercial litigation from various jurisdictions, including the United States, Britain, Australia and Singapore, to discuss the topics related to this theme.
