A New Agreement between China and Singapore on a Guide for the Recognition and Enforcement of Money Judgments
On 31 August 2018, the Supreme Court of Singapore and the Supreme People’s Court signed a Memorandum of Guidance (MOG) that provides guidance on the standards and procedures for money judgments issued by the Singapore courts in commercial cases to be recognized and enforced in the Chinese courts, and vice versa. The aim of this arrangement was to promote mutual understanding of the laws and judicial processes between the two courts, with a view towards facilitating the process and providing practical support for litigants to enforce foreign judgments in China or Singapore.
The Effect of the MOG on Recognition and Enforcement Procedures in China
Prior to the signing of the MOG, an applicant wishing to enforce a Singapore judgment in China would need to refer to precedents and case law on the principle of reciprocity for direction. Singapore, like most other countries, does not have an enforcement treaty with China and it is generally not easy to enforce a Singapore judgment in China. By providing conceptual and practical guidance on recognition and enforcement proceedings, the MOG offers useful clarity for future cases for both litigants and courts and marks an important step in the judicial cooperation between China and Singapore.
The Applicability of the MOG
The MOG applies to money judgments in commercial cases, including judgment on costs. These money judgments are not limited to international matters, but also include non-international cases.
There are also certain money judgments which may not be enforced. These include:
- Judgments which would amount to the direct or indirect enforcement of foreign penal, revenue or public law if recognized and enforced and;
- Judgments which are not final and conclusive i.e. is subjected to appeal or there is an application pending for appeal
Where a Singapore judgment is being enforced in China:
- Judgments which relate to intellectual property rights cases, unfair competition cases or monopoly cases
Overall, the MOG is a welcomed development, especially for a country like Singapore which is increasingly becoming popular as a dispute resolution venue for both court litigation and arbitration cases alike. As the MOG also applies to judgments in the Singapore International Commercial Court, judgments issued by the SICC could be enforced in China, even in commercial disputes between non-Singaporeans and Chinese parties, increasing the attractiveness of the SICC and Singapore for the resolution of disputes.
Further, we note that China has signed the Hague Convention on Choice of Courts Agreement and is in the process of consultation prior to being ratified. The said Convention has already come into effect in Singapore through the Choice of Courts Agreements Act 2016 and we believe that the ratification of the Convention in China in time to come would further strengthen the mutual recognition and enforcement of judgments between the two jurisdictions.
However, commercial parties wishing to select Singapore as a forum for dispute resolution should bear in mind the type of judgments that are excluded from enforcement under the MOG. For instance, contracting parties trying to come to an agreement on the forum to be used under a dispute resolution clause should seriously consider the kind of disputes that may arise under the contract and whether judgments resulting from these disputes are excluded from being enforced based on the guidance provided in the MOG.
|For Further Information, Please Contact:|
|John SzeDeputy Managing Partner
T: +65 6324 0232