Response Speech by Second Minister for Law Edwin Tong at the Committee of Supply Debate 2024

01 MAR 2024

1 Mar 2024 Posted in Parliamentary speeches and responses

1. Mr Chairman, Singapore is a small city state.

2. Much of our growth depends on our ability to develop strong enterprises and attract foreign investments into Singapore.

3. Today, Singapore continues to be the partner of choice for many businesses - from the world’s multinational corporations (MNCs) to the fastest growing startups. We have the highest number of regional headquarters in Asia-Pacific. About 4,200 MNCs host their regional headquarters here, using Singapore as the gateway into ASEAN, Asia and even the world. We have a vibrant innovation ecosystem with research and development (R&D) labs for leading Fortune 500 companies; as well as over 150 venture capital funds, incubators and accelerators.

4. But this did not happen by chance.

5. Businesses come here in large part because of our strong rule of law, trusted legal system, under-pinned by a well-respected Judiciary.

6. They trust that their investments will be safe and their rights will be protected.

7. Businesses also work out of Singapore because they can access the best legal services - be it dispute resolution, intellectual property (IP) transactions, restructuring and insolvency or banking, financial and commercial transactions.

8. It is therefore important for Singapore to continue to build strong legal frameworks that are business-minded and forward-looking; develop first-class legal services and jurisprudence; and really be at the forefront of legal thought leadership. And all these will strengthen our value proposition as a global business centre.

9. In addition, legal and IP sectors are also growth engines in and of themselves, contributing to the economy and jobs.

10. Our legal services sector has grown steadily over the years.

(a) The nominal value-added of our legal services sector increased by more than 25%, from S$2.36 billion in 2018 to S$2.98 billion in 2023.

(b) Our exports of legal services have also increased by nearly 35%, from S$1.04 billion in 2018 to S$1.40 billion in 2023.

(i) The Singapore International Arbitration Centre (SIAC) administers many cases which do not have a connection directly to Singapore. It shows their international reach.

(ii) The Singapore International Mediation Centre (SIMC) also has an increasing caseload. In fact, last year, it had its most number of cases since it started operations.

(d) The Singapore International Commercial Court (SICC) saw an increased caseload as well last year, up by about 30%.

(e) Our IP regime and innovation environment are also internationally recognised.

(i) We were ranked top in Asia and 5th in the world in the 2023 Global Innovation Index.

11. But as Mr Murali Pillai says, we should not rest on our laurels. Indeed, we cannot because we are facing a challenging and competitive external environment. If we do not continually improve, others will come in, fill the gap, and take our space.

12. Sir, MinLaw is therefore working to improve our value proposition in a number of ways.

I. ELEVATING SINGAPORE’S POSITION AS AN INTERNATIONAL LEGAL SERVICES HUB

A. Developing Strong Frameworks

13. First, we need to continue strengthening our legal hub.

14. Our approach is a very practical one – to ensure that parties’ commercial needs are met and we ensure party autonomy as far as possible:

(a) Whether in the choice of law; or

(b) Choice of forum for dispute resolution, be it mediation, arbitration or the Singapore courts, including the SICC; as well as

15. We are also plugged in to the latest trends and developments, so that we can quickly move to update our laws and it moves in tandem with evolving mercantile needs.

16. Let me give two examples:

(a) First, we introduced various enhancements in international arbitration, which Mr Zhulkarnain mentioned. In 2020, we provided a default mode of appointment of arbitrators in multi-party arbitration and recognised that the arbitral tribunal and High Court have the power to enforce confidentiality obligations amongst the parties. In 2017 and 2022, we introduced additional funding options that were available in some other international arbitration centres, such as third-party funding and conditional fee agreements.

(b) Second, the Singapore Convention on Mediation (SCM), also mentioned by Mr Zhulkarnain, provides a uniform and efficient framework for parties to enforce their mediated settlement agreements across borders. Currently, there are 56 signatories and, as of today, 14 Parties, including Sri Lanka, who just ratified the Convention two days ago. We have been actively encouraging countries to adopt the SCM and to promote mediation, through events and trainings, some of which, we do overseas as well. And we do all these because, as the number of Convention Parties grow, mediation will also become more attractive for businesses. Singapore parties who trade with parties from any of the Convention country will be able to effectively use mediation as a means to resolve their disputes. This can translate into time and cost savings, not to mention the preservation of goodwill and relationship.

17. We are also involved in shaping international instruments, which may impact or potentially benefit Singapore. For instance, the Hague Judgments Convention. MinLaw participated in the negotiations from 2015 until its completion in 2019, because we recognised its potential to increase the enforceability overseas of Singapore judgments in commercial or civil matters. To Mr Murali Pillai’s specific query, we are now assessing whether to sign on and on what terms we will do so.

B. Strengthening the legal profession

18. Along with a good legal framework, we need a robust, strong legal profession to serve businesses – law firms and lawyers, who can be trusted advisors to help businesses navigate different legal systems.

Law Firms

19. On this, we aim to:

(a) Anchor top international law firms to strengthen our foreign and international law offerings; as well as

(b) Continue to maintain a strong core of Singapore law practices.

20. I am heartened to see Singapore law practices expanding their presence and networks overseas. As I mentioned at the outset, Singapore is a small market. Our population is 5.5 million. So, we need to see the region as our hinterland. ASEAN alone has a population of about 660 million and fast growing. Asia, about 4.7 billion. And both these regions are the beneficiaries of increasing foreign direct investments.

21. So, MinLaw is committed to supporting our law firms in their internationalisation efforts. One of the key markets, to give you an example, is China. We introduced the Singapore-Shanghai Lawyers Exchange Programme together with the Law Society last year. Our firms in Singapore hosted the inaugural batch of 10 Shanghai lawyers. We received feedback that this helped them to better understand the Singapore market and form new connections. And in turn, our Singapore lawyers through interaction with the Chinese lawyers, also understand the Chinese legal market better. They also form new connections. Later this year, we will be sending our Singapore lawyers to Shanghai on the return leg of the exchange programme. This programme will help them also build networks, understand the nuances of doing business in a foreign jurisdiction and strengthen their value proposition as a lawyer. If there is demand, we will explore similar programmes with other jurisdictions.

22. Our support also extends to smaller firms. As Mr Raj Joshua Thomas highlighted a moment ago, they are an important part of our legal ecosystem. Many of our small firms have deep expertise in niche areas and some of them take on international, high-value work. In fact, most of the Singapore lawyers who are going on this Shanghai exchange that i spoke about, come from smaller firms.

23. Mr Thomas also asked how we can support small firms, joining practices together to form a larger entity.

24. Small Singapore practices can come together to form Singapore group practices with other freestanding law practices now, if they wish. This enables firms to reach broader, allow them to reap benefits of co-branding, reap economies of scale in office as well as resource costs.

Lawyers

25. Besides law firms, we also look at developing our lawyers – from the time they enter law schools, right through to when they go into practice and beyond.

26. Last month, the Working Group for the Reform of Legal Education made recommendations on legal education and training. Essentially, to keep pace with developments and shifts in other jurisdictions. One recommendation was to enhance the coverage of civil law concepts. Why? We see this as an important area, since more than half of Singapore’s top trading partners operate in civil law jurisdictions.

27. Earlier, we also accepted the Committee for the Professional Training of Lawyers’ recommendations aimed at lifting overall standards. One key recommendation – to lengthen the practice training period from six months to one year – will be implemented this year. Ms Nadia Samdin asked about the readiness of the firms and students. In fact, Ms Samdin would recall that we announced this in 2018, some six years ago, precisely to give sufficient lead time to trainees and firms to make that transition. It was to have come into effect last year, but we deferred it by one year, taking into account the impact of COVID-19 as well as industry feedback.

28. These changes, overall, will help our lawyers better meet the challenges of competition.

29. However, as we all know, learning should not stop, even after one is called to the Bar and out in practice.

30. Legal practice is always evolving, as the world keeps moving and commercial needs keep evolving.

31. As Deputy Prime Minister (DPM) Wong emphasised in his Budget speech, we also need to equip our workers for life, likewise lawyers. For the SkillsFuture Level-Up Programme, which is applicable to all Singaporeans aged 40 and above, this programme will also apply to legal professionals.

32. Besides broad-based support, MinLaw has also introduced specific, targeted support for the legal industry.

33. Let me give some examples. For instance, Ms Nadia Samdin would be pleased to know that we have introduced a secondment programme for young lawyers. These secondments seek to provide young lawyers with exposure to high-growth areas in our economy, such as block-chain technology, as well as international sustainability financing. This will allows our lawyers to deepen industry knowledge and skillsets, also build contacts and networks with the relevant industry path makers.

34. And we will do our best to create opportunities for young lawyers, but they will need to also step up to seize these opportunities.

35. Indeed, Ms Nadia Samdin spoke about the challenges faced by young lawyers, including the intensified pace of work that they experience today. This is a feedback that we have heard in our regular engagements with young lawyers. Those of us who are lawyers in this Chamber were once young lawyers, maybe some are still young lawyers, we know that sometimes, practice can be challenging, clients are demanding, hours are long.

36. And we should collectively do our best to improve the work culture, allow for more mentoring of young lawyers, guide them in the profession, expose them to opportunities. But we also have to recognise the reality that we have to live with. We live in a globalised world today. I spoke about the competition earlier. We are competing with, not just the lawyers within Singapore, but also from overseas. If we are not careful, we will lose our competitive edge and lose work and our market share to other jurisdictions.

37. Fundamentally though, I think that our young lawyers are resilient, very forward-looking, very determined to do well.

38. So, on our part, we will continue to enhance our legal industry and seek out opportunities for young lawyers.

39. These efforts overall, will also deepen the strength of our legal industry, which Mr Murali highlighted, and ensure that Singapore continues to be a strong legal hub, one that encourages businesses, including MNCs, to choose Singapore for their operations and meet their legal needs.

C. Technology

40. Finally, a few words on technology, which Mr Christopher de Souza, as well as Mr Zhulkarnain spoke about – the use of technology to work smarter and meet complex demands.

41. Generative Artificial Intelligence, or GenAI, has received attention recently, some good, some not so good. We will continue to encourage law practices to embrace technology to help them level up. Members will know that we introduced the Legal Technology Platform (LTP) for lawyers previously. In October 2023, MinLaw and the Infocomm Media Development Authority (IMDA) introduced the Legal Industry Digital Plan (IDP), and as part of the Legal IDP, we identified tools that will help automate knowledge work. For example, document review and assembly tools can drastically cut down the time needed for some rote tasks. Lawyers can then be freed up to do higher-value work, or client-facing work. And the IDP is designed to work in tandem with the LTP. We are also looking to include tools in our current grant, the Productivity Solution Grant for the Legal Sector, to help Singapore law firms level up on the technology front.

II. IP SERVICES

42. Sir, let me now turn to our strategies in intellectual property, or IP.

43. The value of an enterprise now increasingly lies in IP and intangible assets, or IA. This can be seen from the increase in IP filings globally. In Singapore, our patent filings grew by 40% and our trademark filings grew by 35%. It is, thus, important for us to continue to maintain a strong regime that is business-friendly and very forward-looking as well.

44. In recent years, we have updated our laws to keep pace with developments. In 2021, we overhauled the Copyright Act, in light of new technologies and also market development in the digital age. In 2022, we made amendments to improve the IP registration process, made it more business-friendly. Our Courts have also contributed with important jurisprudence, such as the I-Admin decision that changed the law on breach of confidence.

45. But having a strong network and protecting IP is really just the beginning for us.

46. What will add value to a business is the ability to commercialise and monetise their IP, and use it as a stepping stone to grow their businesses.

47. MinLaw, the Ministry of Finance (MOF) and the Ministry of Trade and Industry (MTI) therefore launched the Singapore IP Strategy or SIPS 2030 in 2021.

48. SIPS 2030 is designed to help enterprises unlock the value of their IA and their IP; spur innovation in the economy, as Mr de Souza said; and also support overall economic growth, particularly for the SMEs.

49. We will better support businesses in their IP journey. And let me give the Members some examples of the programmes that Intellectual Property Office of Singapore (IPOS) has. Last September, IPOS launched GoBusiness IP Grow, an online platform with a wealth of IP resources, including free tools, guides, programmes, as well as access to Government grants. This adds to existing programmes, such as the IP Business, as well as the Legal Clinics.

50. IP is also important for youths, budding entrepreneurs and arts creators, as Ms Nadia Samdin mentioned. To increase awareness, IPOS has a wide range of resources on various platforms made available and it constantly refreshes and updates them in response to market trends. For example, we have the recent AskTheExpert video series on copyright and trademark matters. IPOS also works with industry partners to support microbusinesses, as well as freelancers. And often it is this segment of society or the economy, who are not able to unlock the value in their own IP. So, IPOS, for example, has worked with the National Library Board (NLB), and the Visual, Audio, Creative Content Professionals Association Singapore, and we held a session recently for creators to come together and learn from IPOS on how to better protect their works with IP. This helps them level up, monetise and go further.

51. As I mentioned, it is also critical to support growing businesses with more sophisticated IP strategies and management processes. In September last year, IPOS launched IP Ready. This pairs local businesses with experts, coming together to develop IP strategies in a curated way, institutionalise IP management processes, and also, overall, help to build IP capacity to sustain business growth. IP Ready will support the development of key innovation sectors, such as the information and communications technology (ICT) as well as the biomedical technology.

52. We will also support businesses in monetising the value of their IP and other intangible assets. Last September, we launched the Intangibles Disclosure Framework, which helps business disclose their IA in a systematic and consistent manner. We are also working on guidelines for valuing these IA, so that there is a common platform and a common standard and then, that value and the way that you use the value to monetize, can be interoperable across different markets. Together, these initiatives will help businesses and investors appreciate and leverage on the true value of a business’s IA.

III. COMMUNITY DISPUTE MANAGEMENT FRAMEWORK

53. Sir, before I conclude, let me touch on the Community Dispute Management Framework, an issue that Mr de Souza, Mr Lim Biow Chuan, Mr Sitoh Yih Pin and Mr Derrick Goh spoke about.

54. Sir, we understand and agree with the points which Members have made.

55. It is also important that we tackle community disputes quickly, before the dispute becomes intractable, causing irreparable rifts in society. This rift could then lead to neighbourly friction and ultimately, loosen the threads in the fabric of our cohesion.

56. As Members know, we have been working on a revised framework to address this issue. This will come in three parts:

(a) One, the Ministry of National Development (MND) has been stepping up efforts to promote and encourage, as well as to enforce pro-social norms upstream and will also set up a dedicated team of personnel to respond on the ground, something I will come back to in a moment.

(b) Second, mandating mediation in appropriate cases.

(c) And third, where parties end up at the Community Disputes Resolution Tribunals (CDRT), we want to enhance the processes and the powers of the CDRT to make it a far more expedient and efficient process.

57. Let me start with mediation, which Members will agree is effective and particularly useful in community disputes, mainly because we are dealing with disputes between two known parties or neighbours, and sometimes, the disputes have a strong emotional undercurrent as well. These are parties who will continue to have to live side by side and probably see each other every day. So, rather than look at legal right or legal wrong in vacuum, mediation helps to bring parties together, look at the bigger picture, look at the overall relationship, and come to reach an understanding and compromise on the matter far more easily. This also helps to keep the parties on good terms.

58. The Community Mediation Centre (CMC) has, therefore, increased the number of volunteer mediators by 15% over the past year, in anticipation of such increasing cases, given that we are mandating mediation. Today, we have close to 160 volunteer mediators and we will continue to grow this pool.

59. The CMC has also set up satellite mediation venues in the neighbourhoods, so that residents can take part in mediation closer to their homes. In the past year, we have grown the number of satellite venues from 6 to 10, and have plans to add more in the neighbourhoods. CMC has also started using Zoom for mediation, in the appropriate cases, to make mediation even more accessible.

60. To drive more cases towards an early and amicable settlement, we will, therefore, mandate mediation in appropriate cases. This is in line with the suggestion that some Members have spoken about. So, the dedicated response team that I mentioned earlier will be given powers to come onto the ground, understand the problem, triage and identify suitable cases, and direct the neighbours to go to mediation.

61. In many community dispute cases, quick intervention can often help to prevent the matter from escalating further, before the emotions set in and parties become intractable in their positions. So, apart from mandating parties to attend mediation, this team will also, in the appropriate cases, be present on site at the location of the disamenity and will be empowered to issue warnings and advisories. If the team is satisfied that there is evidence of persistent nuisance or otherwise egregious conduct, it can also issue an abatement order, which is a direction for the particular nuisance to stop, pending mediation or a CDRT adjudication. Non-compliance with an abatement order will be an offence. We are now preparing to set up this dedicated unit of officers, which will take some time. But for a start, we intend for this unit to cover community disamenities, like noise and hoarding, which could have a serious impact on community harmony.

62. Finally, as I have said earlier, it is not ideal for neighbours to turn to litigation immediately to deal with a community dispute.

63. Hence, going to the CDRT should really be a measure of last resort, only if all the other upstream intervention measures that I spoke about do not yield a successful outcome.

64. But for those who have to turn to the CDRT, it probably means you have gone through a process, you are unable to resolve it and it has been an issue for some time. We want to turn the CDRT process into one that allows parties to obtain relief quickly and effectively. We have, therefore been working closely with the CDRT to identify several process areas which we will improve. For example, in serious cases, the CDRT will be empowered to make interim orders on an expedited basis and based on a lower threshold. This will allow affected residents to obtain quick relief, even as the case awaits a full hearing.

65. This framework has been the subject of public consultations. On these ideas, generally, the responses have been positive and supportive and we will take on board this feedback, make some adjustments as may be appropriate and frame the legislation, because these measures will require legislative support. And We are targeting to introduce this later this year. Further details will be shared in due course.

IV. CONCLUSION

66. Sir, I thank the various Members for their comments and suggestions, and I look forward to their continued support for MinLaw’s work.

Last updated on 01 March 2024