Speech By Mrs Lim Hwee Hua
Minister Of State For Finance And Transport
At The Launch Of The Singapore Chamber Of Maritime Arbitration
8 Nov 2004, 11.45 Am
Raffles Hotel, Singapore
Distinguished Guests
Ladies and Gentlemen
I am very happy to join all of you for the launch of the Singapore Chamber of Maritime Arbitration.
2 The maritime industry in Singapore is an important pillar of our economy. It contributes about 7% to our GDP, and provides some 120,000 jobs. While Singapore is already well established as a major hub port, we are continually developing our maritime services sector as a second engine of growth to complement our port and shipyards.
3 To this end, MPA has taken a lead role to develop Singapore into an International Maritime Centre (IMC). One of the key strategies is to increase the breadth and depth of maritime ancillary services offered in Singapore. The maritime legal services sector is one such sector that we recognise as a high value-added service that is critical in supporting our IMC development.
4 Indeed, a strong maritime legal services sector would benefit virtually every player in the maritime industry, from shipowners to insurers, financiers and charterers, be it in providing legal advice, preparing contracts, or in resolving disputes through arbitration. The sector itself can also generate good business opportunities if we are able to position Singapore as a maritime legal services hub for Asia. This is especially crucial given the rapid expansion of the Asian maritime industry.
5 Currently, we are already well-placed to serve as Asia's leading centre for maritime law and dispute resolution. With 4,000 maritime and maritime-related establishments in Singapore, there is a ready pool of clientele for the maritime legal services sector to tap on. Given our business-friendly environment, excellent infrastructure and connectivity, this number is expected to grow even more over time, as more maritime companies use Singapore as a launch pad to reach out to their suppliers and customers in the region.
6 Singapore has also a well-developed legal system that is based on the English common law, a system that the international maritime community is familiar with. Our position as an independent jurisdiction is another plus-point. In the area of arbitration, we set up the Singapore International Arbitration Centre in 1991 to serve as a professional and reliable dispute resolution institution for the international business community. In 2002, we established a dedicated Admiralty Court, the first of its kind in Asia, to build up our expertise in this area and to ensure the speedy and fair resolution of maritime cases in Singapore.
7 However, more can be done to grow our maritime legal services sector. To this end, we have adopted a three-pronged approach. First, develop Singapore's maritime legal expertise. Second, ensure that our regulatory policies are conducive to encourage the growth of maritime legal activities. And third, actively profile and promote the use of Singapore as a maritime legal hub and dispute resolution centre to the international community. While a large part of our efforts is still work in progress, there are already some signs of encouraging developments. Let me briefly share some of these with you.
8 To develop Singapore's maritime legal expertise, MPA has set aside S$4 million to establish a Professorship in Maritime Law at the National University of Singapore (NUS) Faculty of Law. MPA also established postgraduate scholarships in maritime law, so that promising lawyers in Singapore can pursue their postgraduate studies in renowned maritime law schools overseas. To date, two local lawyers have benefited from the scholarship and have completed the LLM in Maritime Law at the University of Southampton.
9 Next, we will continuously review our policies and enhance our regulatory framework to encourage the growth of maritime legal activities. In June this year, the Ministry of Law amended the Legal Profession Act to allow foreign lawyers to represent parties for arbitration activities in Singapore. As such, foreign lawyers can now advise, prepare documents and provide assistance in arbitration proceedings using Singapore law, without the need to participate jointly with a Singapore lawyer for such cases. This is a positive step in attracting maritime companies and international maritime arbitrators to conduct their arbitration cases in Singapore.
10 Lastly, to ensure that rules and legal standards keep up with international developments and requirements, the Ministry of Transport has tabled an Amendment Bill to seek Parliament's approval for Singapore to accede to the 1976 International Convention on Limitation of Liability for Maritime Claims, or LLMC 76. This Convention protects the interests of both shipowners and potential claimants, by providing greater certainty for the contracting parties in the event of a claim. We have received feedback from the industry that the adoption of LLMC 76 would align our standards to those in leading maritime jurisdictions, such as London; and increase the attractiveness of using Singapore as a centre for resolving maritime disputes.
11 But that's not all that we are doing. We recognise the importance of industry feedback and actively seek suggestions from the maritime community to see how we can further enhance this sector. In March this year, Dato' Jude Benny led a Working Group, comprising key stakeholders from the maritime legal sector, to spur the development of maritime arbitration in Singapore. One of the key initiatives spearheaded by Dato' Benny and his team is the establishment of the Singapore Chamber of Maritime Arbitration, or SCMA. The SCMA is the collective effort of the Singapore Maritime Foundation, the Singapore International Arbitration Centre, the Singapore Institute of Arbitrators, the Singapore Maritime Arbitrators' Association, and the Maritime Law Association of Singapore.
12 Today, we are here to celebrate its launch, and I would like to make use of this occasion to commend Dato' Benny and his team for the splendid job. Well done! They have worked very hard over the past six months to set up the SCMA, from coming up with the Rule Book, the Scale of Fees, to the standards for the Panel of Arbitrators. One noteworthy initiative is the incorporation of a "fast track" procedure for claims under US$75,000, where a sole arbitrator will resolve the dispute within 21 days.
13 As we can all see, the SCMA has started on a good footing. It has attracted a panel of distinguished practitioners from Singapore and beyond to its launch. I would especially like to welcome our distinguished foreign guests who have flown halfway across the globe to be with us today. They are, Mr Patrick O'Donovan, chartered arbitrator and member of the Baltic Exchange, and Mr Manfred Arnold, a Governor on the Board of the Society of Maritime Arbitrators based in New York.
14 I am also happy to learn that six Singapore companies, namely NOL, Pacific International, Pacific Carriers, Keppel, Sembawang and Pan United have pledged to support the use of the dispute resolution processes of the SCMA, and to incorporate SCMA Arbitration Clauses in their maritime related contracts, wherever appropriate. This endorsement from the industry reflects their confidence in the SCMA and its capability to deliver good results.
15 Let me once again extend my heartiest congratulations and thanks to the pioneer panel of the SCMA. Indeed, the SCMA will play a key role in promoting and profiling Singapore as a centre for maritime arbitration. On this note, let me end by wishing the SCMA every success in the years to come.
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