Just how attractive is Singapore as an arbitration venue for Indian parties?
According to figures released by the Singapore International Arbitration Centre (SIAC) in their Statistical Report on India 2000-2010 and 2011 Annual Report, the SIAC handled more cases involving at least one Indian party in the last three years than in the years 2000 to 2008 combined: 84 cases involving at least one Indian party between 2009 and 2011 vs. a total of 50 cases between 2000 and 2008.
The SIAC 2011 Annual Report also credits India as contributing the highest source of filings for each of the last three years.
And we haven’t even added to the mix the number of non-SIAC administered and ad-hoc arbitrations in Singapore involving at least one Indian party – there are no consolidated statistics for this, but anecdotal evidence suggests that the number is not insignificant.
What makes Singapore such an attractive venue for Indian arbitration users?
- Neutrality: Singapore is ranked 5th in the Corruption Perception Index 2011 and the only Asian country ranked in the top 10.
- Convenience and connectivity: Singapore is closer to India than the other established arbitration venues in Europe. It also boasts a stable and open economy, a useful Double Tax Treaty with India and excellent flight connectivity within the region and internationally.
- A well established legal system with a strong tradition of the rule of law and supported by a top-notch judiciary. Singapore’s legal system shares common roots with the Indian legal system in that they both derive from English law.
- English is the first language, making it easy for Indian parties to operate here.
- State-of-the-art arbitration facilities and services in the form of Maxwell Chambers – Asia’s largest integrated dispute resolution complex.
- Singapore arbitration awards are enforceable in India and also 140 over countries worldwide that have signed up to the New York Convention of 1958 on the enforcement of arbitration awards.
It is worth mentioning that not all awards originating from countries which are signatories to the New York Convention of 1958 are enforceable in India as foreign awards. India has taken the position that only foreign awards made in territories notified in the Official Gazette may be enforced in India. Prior to 19 March 2012, only 46 countries were notified, amongst them Singapore, Australia, Thailand, France, Malaysia and Switzerland, but notably, not Hong Kong or China. On 19 March 2012, the Indian government advised that China (including Hong Kong and Macau) would be notified as a territory to which the New York Convention applies.
Will the additions of China and Hong Kong to the list of notified territories affect Singapore’s popularity as an arbitration venue for Indian parties? Not to a significant extent I would think, and also not so soon – even if parties begin to draft China or Hong Kong into their dispute resolution clauses and contracts today, chances are that any disputes arising from these contracts will only materialise in the next one to three years.
I will be in Mumbai and Delhi next week (together with The Watcher) and should soon have a better idea whether these recent developments are likely to affect Singapore’s popularity amongst Indian arbitration users. Update to follow.
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