Government measures in key jurisdictions 5th edition - Flipbook - Page 116
Singapore
Contractual
Issues
What measures
have been taken
to reinforce
contracts?
The Singapore government has enacted legislation providing for temporary relief for the
inability to perform a scheduled contract. It provides temporary relief from legal action
over the following contracts (entered into before 25 March 2020 with contractual
performance due on or after 1 February 2020) up to a certain date:
•
Hire-purchase agreements and conditional sale agreements for plant, machinery or
fixed assets used for manufacturing, production or other business purposes, or a
commercial vehicle excluding those entered into with banks or finance companies
regulated by MAS – up till 31 January 2021.
•
Rental agreements for commercial equipment or commercial vehicles – up till 31
January 2021.
•
Sale and purchase agreements between purchasers and housing
developers/commercial developers in respect of one or more units of housing
accommodation/commercial property – up till 31 March 2021.
•
Construction or supply contracts, or any performance bond granted thereto – up till
31 March 2021.
•
Options to purchase issued by housing developers/commercial developers to
intending purchasers for one or more units of housing accommodation/commercial
property – up till 31 March 2021.
Moratorium on enforcement: A debtor under any of these contracts may issue a
notification for
relief if he finds that an obligation due on or after 1 February 2020 cannot be carried
out due
to the Covid-19 pandemic. Upon which creditors are prohibited from taking the following
actions:
• court, domestic arbitration, and insolvency proceedings, as well as execution
proceedings against the debtor’s property;
• enforcement of security against immovable/movable property used for business
purposes,
• appointing a receiver and manager over the debtor’s property;
• calling on a performance bond given for a construction or supply contract;
• terminating a lease or license over immovable property due to non-payment of rent;
• exercising any right of re-entry/forfeiture under a lease or license over immovable
property;
• increase of any charges or interest rate payable under the contract unless such
increase in charges or interest is specified in the contract and the increase in
charges or interest rate is calculated by reference to a formula in the contract (any
additional increases will not be allowed without further agreement of the nonperforming party);
• imposition of new charges under the contract without the further agreement of
the non-performing party;
• requiring any part of a security deposit given pursuant to the contract to be replaced
by the non-performing party except with the further agreement of that party.
The aforementioned actions cannot be taken until after the earliest of:
• the expiry of the respective relief period;
• the withdrawal of the notification for relief; or
• a determination by an assessor that the case is not one eligible for the moratorium
(note: under the new legislation, if a party is not able to come to an agreement with
the other party or parties to the contract for a compromise in relation to his/her
obligations covered under the notification for relief, he/she may apply for an
assessor’s determination of the issues involved.
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Government measures in key jurisdictions
