As part of the Introduction to ASEAN class, Mr. Samuel Seow and Mr. Paul Tan from Rajah and Tann Singapore gave a presentation on “Dispute Resolution Options in ASEAN,” on April 4th, 2015. The presentation was divided into two parts. In the former half of the presentation, Mr. Seow presented an overview of the economics of ASEAN, the relevance of international arbitration in ASEAN, and concerns and issues for the ASEAN practitioner. Mr. Tan then presented information about the Singapore International Commercial Court, the Singapore International Mediation Center, investor state arbitrations, the ASEAN Comprehensive Investment Agreement, and the possible future developments in ASEAN from a legal perspective in the latter half of the presentation.
In the economic overview of ASEAN, Mr. Seow provided some general statistics concerning global trade, foreign direct investment, and trade volumes, all of which illustrate the economic growth of ASEAN. He recounted the goal of economic integration within ASEAN by 2015 and the envisaged characteristics of the ASEAN Economic Community and the regulatory risks resulting from such integration.
Mr. Seow then transitioned to the topic of dispute resolutions by providing reasons justifying the importance of studying such topic. Because conflicts are inevitable, and disputes will arise both within ASEAN, between member states, and outside of ASEAN, it is essential to have ways to resolve such disputes, one of which is international arbitration. International arbitration is relevant in ASEAN for various reasons. First, arbitration’s popularity has been increasing in ASEAN and in Asia. Second, arbitration may be considered a superior dispute resolution mechanism for transnational disputes. Third, arbitration would generate a lot of revenue for practitioners of law. Arbitration is defined as a private means of resolving disputes by agreement, which is particularly useful for cross border disputes because of, among other things, the neutrality of the venue and the proceedings and the enforceability of the decisions under the New York Convention.
Mr. Seow then went on to address the concerns and issues surrounding international arbitration for the ASEAN practitioner. The first was the effects of liberalizing the legal market in ASEAN. Such liberalization would cause foreign lawyers to be able to practice arbitration in countries outside of their own, and, as a result, increase work opportunities for everyone. However, an important point that must be taken into consideration is the competition that might arise between the ordinary courts and courts of arbitration as a result. The second was the dilatory tactics, or tactics that are meant to stall or confuse the arbitration process, used. The third was the language and cultural barriers that might exist due to the diversity within ASEAN member states. The final was confidentiality issues of arbitration and the lack of community participation in ASEAN, which is a result of such confidentiality because it prohibits nonparties from being involved in arbitration proceedings. Mr. Seow then presented some SIAC figures which revealed the increase in international disputes resolved through arbitration and the diversity of nationals involved in the SIAC. He briefly mentioned the unique characteristics of the arbitration institutes of various ASEAN nations including: Thailand, Malaysia, Cambodia, and Myanmar.
Mr. Tan then began the second half of the presentation by describing the Singapore International Commercial Court and comparing it with international arbitration. The purpose of the establishment of the court was to “build upon and complement the success of Singapore’s vibrant arbitration sector and make the city state’s judicial institutions and legal profession available to serve the regional and global community.” Its aim is to deal with high value, complex, cross border commercial disputes. The SICC tries actions or claims which are international and commercial in nature. The SICC is similar to international arbitration in many areas, for example, in the areas of foreign representation in international cases and confidentiality. The two are different in the areas of: the joinder of the third parties to proceedings, the availability of default judgments, cross border enforceability, unilateral appointments, and appeals.
Mr. Tan went on to discuss the Singapore International Mediation Centre. The SIMC offers professional appointing authority and case management services and provides an innovative dispute resolution process known as Arb-Med-Arb, which is a joint initiative between the SIAC and SIMC.
Mr. Tan then explained the concept of investor state arbitrations, which are treaties between two or more nations that aim to provide minimum levels of protection to the investment of companies or individuals from the other nation. The investment of such companies must be of a certain duration and must involve a degree of risk and a significant contribution to the host country. Investments concerned are usually construction projects. These treaties provide protections to foreign investors such as: non-discrimination, fair and equitable treatment, and protection from denial of justice.
Mr. Tan briefly addressed the ASEAN Comprehensive Investment Agreement, which is significant to the AEC blueprint and promotes fair and equitable treatment and full protection and security.
Mr. Tan concluded by providing his perspective on the future of international arbitration in ASEAN. He discussed the possibility of cross-border enforcement of judgments in ASEAN as is practiced with certain limitations in the European Union under the EU Brussels convention. Mr. Tan addressed the future possibility of the establishment of an ASEAN legal institute to study areas of law in ASEAN in order to harmonize business laws in ASEAN and create codes of laws and regulations that are applicable to all member states. Successful harmonization would facilitate and, in turn, encourage foreign investment in ASEAN as it would eliminate the cumbersome and tedious task of studying the business laws of every nation separately.
By Pundaree Tanapathong, first year student