Singapore’s Legal System
Singapore’s legal system is recognized for its fairness, integrity, and efficiency – making Singapore one of the best countries globally for starting and running a business. The World Bank group recognized this in its annual Doing Business report, where it found Singapore’s regulatory environment to be the most business-friendly.
This article includes the following topics:
A Rule-based Country
Rule of Law has enabled good governance in Singapore
BEST IP PROTECTION
Singapore is ranked at the top in Asia for having the best protection of intellectual property.
Source: World Economic Forum’s Global Competitiveness Report
Singapore is the least corrupt nation in Asia.
Source: Transparency International, Corruption Perceptions Index
BEST IN ARBITRATION
Singapore is the most popular Asian jurisdiction for arbitration.
Source: International Arbitration Survey – Choices in International Arbitration
BEST IN DOING BUSINESS
Singapore topped the global ranking for “ease of doing business” for the 10th consecutive year.
Source: World Bank’s Doing Business Report
Types of Laws
If you operate a business in Singapore, your business will be enabled and constrained by Singapore’s law. Those laws come from a variety of sources.
Singapore has a Constitution that ensures the fundamental rights of its citizens. Everyone in Singapore is treated equally, regardless of their race, religion or sex. The Constitution also sets forth the basic framework for the government with its three branches: the Legislature, the Executive and the Judiciary. These three branches are charged with creating and enforcing the laws of Singapore.
The Legislature, known as the Parliament, enacts Singapore’s law. The Executive, headed by the President and his or her Cabinet, implements the laws enacted by the Parliament. As part of its implementation, the Executive writes detailed regulations. Regulations are subsidiary laws that flesh out the laws written by the Legislature to ensure that the Legislature’s law achieve its objectives. Many of the laws that regulate business in Singapore originate with the Legislature and the Executive, such as the Singapore Companies Act or the Limited Liability Partnership Act and the regulations used to implement those acts. Finally, when two parties bring a dispute to one of its courts, the Judiciary interprets the law and resolves the conflict. The Judiciary’s interpretations become case law that is incorporated into Singapore’s legal system.
Due to its history as a British colony, English common law is also an important part of Singapore’s legal system. In a common law system, judicial precedent or the decisions from higher courts in previous cases on the same issue, must be followed by the court when deciding a case. Singapore’s law on contracts, torts and restitution has been created through this common law tradition. Originally, Singapore followed English judicial precedent. As the country matured, however, it has become increasingly independent from English law, developing uniquely Singaporean jurisprudence that absorbs the best legal practices from around the world.
Singapore has a well-developed judicial system that is divided into two tiers. The first tier consists of the various State Courts, which hear lower-value cases directly from the people and resolve their disputes. The second tier is the Supreme Court, comprised of the High Court and the Court of Appeal. The Court of Appeal is the highest court of the land.
The State Courts are either District Courts or Magistrate Courts. Both hear civil and criminal cases but Magistrate Courts hear lower-value civil cases and less serious criminal cases.
Magistrate Court cases are:
- Civil cases with claims below $60,000, and
- Criminal cases with maximum sentences under 2-year imprisonment.
District Court cases are:
- Civil cases with claims between $60,000 and $250,000, and
- Criminal cases with maximum sentences between 2 and 7 years imprisonment.
The Chief District Judge is in charge of running the State Court system and has a team of Judicial Officers who adjudicate the cases brought before the State Courts.
In addition to the District and Magistrate Courts, the State Court system has specialized courts. Two specialized courts that are particularly helpful to business are:
- Copyright Tribunal: Rules on disputes between copyright owners and the users of that copyrighted material.
- Labour Court: Rules on disputes between employers and employees.
Other specialized courts include:
- Family Court: Rules on a variety of family-related cases, such as divorce proceedings, adoption and Personal Protection Orders and Domestic Exclusion Orders for those seeking relief from domestic abuse and violence at home.
- Traffic Court: Rules on cases brought by the Traffic Police and the Land Transport Authority.
- Juvenile Court: Rules on criminal cases when the accused is under 16 and Beyond Parental Control cases where parents need governmental assistance in controlling the non-criminal behavior of their children under 16.
- Syariah Court: Rules on marriage disputes between Muslims or those married under Islamic Law.
- Coroner’s Court: Determines the cause of suspicious deaths which may have resulted from criminal activity.
- Community Court: Rules on cases relating to youthful offenders between 16 and 18, mentally disabled individuals, certain elderly offenders over 65, neighborhood disputes, abuse of animals, family violence, and certain race-related hate crimes.
SMALL CLAIMS TRIBUNAL
Because hiring lawyers and litigating a case in a State Court can be expensive, Singapore created the Small Claims Tribunal as an alternative for settling legal issues within the Court system. All parties must represent themselves at the Small Claims Tribunal. Small Claims Tribunal is available when:
- The plaintiff is seeking up to S$10,000 in restitution and S$20,000 in damages.
- Both parties agree to settle the matter in Small Claims Tribunal.
- The civil dispute is about:
- The sale or purchase of goods and services;
- Damage to personal property (except damage resulting from motor vehicle accidents), and
- Residential leases of less than 2 years.
In a Small Claims Tribunal dispute, the dispute will first be mediated and, if that fails, will be adjudicated by the Tribunal. The losing party can appeal the decision to the High Court.
The Supreme Court is comprised of the the High Court and the Court of Appeal and hears both civil and criminal matters.
The High Court
The High Court decides on civil and criminal cases from two sources. First, it can hear appeals from the State Courts for certain types of cases. For these cases, the High Court has the authority to reverse the decision or ask for a retrial. Second, the High Court can hear select cases that originate at the High Court level, including:
- Non-probate cases with claims over $250,000;
- Probate cases with a value over $5,000,000, or cases requiring the resealing of a foreign grant;
- Ancillary matters in family disputes over S$5,000,000, and
- Select criminal cases. Although the High Court has the right to hear the first instance on any criminal proceeding, in practice, the High Court only hears cases where the possible sentence is over 10 years imprisonment, or death.
Most High Court decisions can be appealed to the Court of Appeals, but some are unappealable or can only be appealed with permission from the Court of Appeals.
Decisions by the High Court on points of law become judicial precedent and are binding on all State Courts. They are not binding on the High Court or the Court of Appeal, although those judges should take them into consideration when making their decisions. If there are conflicting High Court decisions, the Court of Appeals should resolve the conflict.
The Court of Appeals
The Court of Appeal is the highest court in Singapore. It rules on appeals brought in civil and criminal case decisions by the High Court, and its decisions are final. The Chief Justice heads the Court of Appeals, which typically consists of three Judge, although a greater or few number of Judges may be assigned to a particular case.
Not only are its decisions final for the litigants, its rulings on points of law become judicial precedent and are binding on all lower courts in all future disputes.
Alternative Dispute Resolution
While Singapore’s judicial system is effective and efficient relative to other countries, Singapore has complemented its courts with alternative dispute resolution (ADR) options. Settling a legal issue through ADR is cheaper, quicker, and easier than litigating in the courts. The two types of ADR in Singapore are mediation and arbitration.
Mediation provides a legally non-binding forum for parties to work out their differences with the support of a mediator. All mediators in Singapore have undergone training at The Singapore Mediation Centre (SMC), a non-profit institute. The vast majority of the disputes ending up in mediation are settled within a day.
When a dispute is brought to arbitration, the decision by the arbitrator is legally binding even if one or both of the parties does not agree with it. The Singapore International Arbitration Centre (SIAC) can arbitrate most civil cases but will not arbitrate criminal or family law issues. Under the New York Convention, decisions by SIAC are enforceable in over 120 countries.
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