A Singapore law overview of public policy exceptions to major international treaties and conventions on shipping, transportation and arbitration

Monday 19 August 2024

Nathanael Lin
Rajah & Tann Singapore, Singapore

Overview

Singapore follows a dualist approach to international conventions and treaties. Under that approach, Singapore's international law obligations do not create independent rights, obligations, powers or duties unless and until transposed into domestic law by enabling legislation.[1] Correspondingly, any public policy exception to the application of international conventions and treaties would also have to be legislated. As a matter of general principle, Singapore courts only interpret enacted legislation, and will not amend or modify legislation based on extra-legal policy factors.[2]

Shipping and transportation

In relation to the carriage of goods by sea, Singapore has ratified the Hague–Visby Rules.[3] For maritime law in general, Singapore has ratified various International Maritime Organization (IMO) conventions.[4] Key IMO conventions and regulations include: the 1976 Convention on the Limitation of Liability for Maritime Claims as amended by the 1996 Protocol (the 'LLMC'); the Convention on the International Regulations for Preventing Collisions at Sea; the International Convention on Civil Liability for Oil Pollution Damage; the International Convention for the Safety of Life at Sea; and the International Convention for the Prevention of Pollution from Ships.[5]

As regards conventions relating to shipping and maritime law, there are no public policy exceptions to their application. However, Singapore has excluded the operation of Article 2(1)(d) and (e) of the LLMC.[6] Hence, claims in respect of the raising, removal, destruction or rendering harmless of a ship that is sunk, wrecked, stranded or abandoned, as well as claims in respect of the removal, destruction or rendering harmless of the cargo of such a ship, will not be subject to limitation in Singapore.

For carriage by air, Singapore has ratified the Warsaw Convention,[7] as amended by the Hague and Montreal Protocols, as well as the Montreal Convention.[8] While there are no public policy exceptions to their respective application, Singapore has excluded the application of both conventions in relation to air carriage for military purposes and to air carriage by the government.[9]

Singapore is not a party to any carriage by road or rail conventions.

Arbitration

In relation to international arbitration, Singapore has adopted the United Nations Commission on International Trade Law (UNCITRAL) Model Law on International Commercial Arbitration (the 'Model Law') and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the 'New York Convention').[10]

Public policy exceptions come into play at three stages of curial intervention:

  1.  the enforcement of an arbitration agreement;
  2.  recourse against an arbitral award; and
  3.  the recognition and enforcement of foreign awards.

Singapore courts will not enforce an arbitration agreement where the dispute is non-arbitrable. The essential criterion of non-arbitrability is whether the subject matter of the dispute is of such a nature as to make it contrary to the public policy considerations involved in that type of dispute to permit it to be resolved by arbitration.[11] Examples of such disputes include those arising from the operation of statutory provisions of insolvency regimes.[12]

For recourse against an arbitral award, as well as the recognition and enforcement of foreign awards, the Model Law and New York Convention, respectively, provide for public policy exceptions. Under Article 34(b)(i) and (ii) of the Model Law and Article V(2)(a) and (b) of the New York Convention, an arbitral award may be set aside where the dispute is not arbitrable or where the award conflicts with public policy.

As a matter of Singapore law, the approaches to the public policy exception under Article 34(b)(ii) of the Model Law and Article V(2)(b) of the New York Convention are identical.[13] For the exception to be invoked as a ground for setting aside, or the refusal of recognition or enforcement, the arbitral award must 'shock the conscience'; be 'clearly injurious to the public good or… wholly offensive to the ordinary reasonable and fully informed member of the public'; or violate Singapore's most basic notion of morality or justice.[14]

 

[1] See the Sahand [2011] 2 SLR 1093; Yong Vui Kong v Public Prosecutor [2015] 2 SLR 1129.

[2] See Lim Meng Suang v Attorney-General [2015] 1 SLR 26 at [77]; Kallivalap Praveen Nair V Glaxosmithkline Consumer Healthcare [2023] 3 SLR 922 at [51].

[3] Given effect by the Carriage of Goods by Sea Act 1972 (2020 Rev Ed).

[4] The various IMO conventions are given effect via the Merchant Shipping Act 1995 (2020 Rev Ed) and its related subsidiary legislation and regulations.

[5] The International Convention for the Prevention of Pollution from Ships (MARPOL) and its technical annexes are given effect via the Prevention of Pollution of the Sea Act 1990 (2020 Rev Ed) and its related regulations.

[6] See s 136(1) of the Merchant Shipping Act (2020 Rev Ed).

[7] Given effect by the Carriage by Air Act 1988 (2020 Rev Ed).

[8] Given effect by the Carriage by Air (Montreal Convention, 1999) Act 2007 (2020 Rev Ed).

[9] See Orders 3 and 4, Carriage by Air (Parties to Conventions) Order (GN No S 248/1988); Carriage by Air (Montreal Convention, 1999) (Exclusion from Convention) Order (GN No S 617/2007).

[10] Given effect by the International Arbitration Act 1994 (2020 Rev Ed) (the 'IAA').

[11] See s 11 of the IAA; Tomolugen Holdings v Silica Investors [2016] 1 SLR 373 at [75] and [76].

[12] See Larsen Oil and Gas v Petroprod [2011] 3 SLR 414 at [46].

[13] See AJT v AJU [2011] 4 SLR 739 at [37].

[14] See PT Asuransi Jasa Indonesia v Dexia Bank Sa [2007] 1 SLR(R) 597 at [59].