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16 Oct 2018

Recognition and enforcement of money judgments in commercial cases between the PRC and Singapore

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On 31 August 2018, the Supreme People's Court of the People's Republic of China ("PRC") and the Supreme Court of Singapore signed a memorandum of guidance on recognition and enforcement of money judgments in commercial cases (“Memorandum”).

The Memorandum provides detailed guidance as to both the criteria and procedure for the mutual recognition and enforcement of money judgments made by the PRC Courts and Singapore Courts.  "Singapore Courts" includes the Singapore International Commercial Court.  It also clarifies that the principle of de facto reciprocity does not only exist between Singapore and Jiangsu province.  Money judgments include judgments on costs. 

Although the Memorandum has no binding legal effect, it follows recent instances of PRC Courts and Singapore Courts enforcing each other's money judgments based on the principle of reciprocity.

  • On 28 January 2014, the Singapore High Court recognised and enforced a judgment made by the Suzhou Intermediate People's Court ("IPC"): Giant Light Metal Technology (Kunshan) Co Ltd v Aksa Far East Pte Ltd, [2014] SGHC 16. As far as we are aware, this is the first PRC Court judgment recognized and enforced by the Singapore Courts.
  • On 9 December 2016, the Nanjing IPC, Jiangsu Province recognized and enforced a judgment made by the Singapore High Court: Kolmar Group AG v. Jiangsu Textile Industry (Group) Import & Export Co. LTD., (2016) S01XWR No.3. The Nanjing IPC held that as the Singapore High Court had enforced a civil judgment made by the Suzhou IPC, even though there was no bilateral agreement between the two countries, PRC Courts could recognize and enforce Singapore Court judgments on basis of reciprocity if the Singapore Court judgment satisfied requirements under PRC law. Upon examination, the Nanjing IPC concluded the Singapore Court judgment did not violate the basic principles of the PRC law or the sovereignty, security, social and public interest of the PRC. As far as we are aware, this is the first Singapore Court judgment recognized and enforced by a PRC Court.

These two cases are significant for the mutual recognition and enforcement of judgments between the PRC and Singapore, and form valuable precedent moving forward. It may also be seen that the relevant provisions of the Memorandum take reference from the practice established in these cases.

Memorandum: enforcing Singapore money judgments in the PRC

The Memorandum requires that the Singapore judgment to be recognized and enforced must:

  1. Be a money judgment
  2. Be final and conclusive
  3. Not amount to direct or indirect enforcement of any foreign penal, revenue or public law
  4. Not be related to certain categories of cases (including but not limited to intellectual property and competition related-matters)
  5. Stem from a dispute which the Singapore Court had jurisdiction to determine; the question of jurisdiction being determined by the PRC Courts under PRC law

The PRC Courts will not re-examine the merits of the judgment or allow it to be challenged on the ground that it contains an error of fact or law.  Only limited grounds for challenge exist, for example, where there are issues of public policy, fraud, or where the litigant had not been given a fair hearing.

Procedure
Apply to the IPC of the place where the defendant is domiciled or the defendant's property is located.  The application should be submitted with the following documents, which are to be notarised in Singapore and confirmed by the PRC embassy in Singapore:

  1. A certified copy of the judgment of the Singapore Court;
  2. Documents to certify that the judgment is not subject to or under appeal, the appeal period has expired in respect of the judgment and there is no pending application for an extension of time to appeal, unless specified in the judgment itself;
  3. If applicable, documents to certify that a litigant without capacity for action has been properly represented, unless specified in the judgment itself.

Judgments obtained in default can be recognised and enforced if there is evidence the judgment debtor has been served in accordance with the law, unless service is already dealt with in the judgment.

If the application, judgment and documents mentioned above are not in the Chinese language, they should be accompanied by a certified translation in Chinese.

Memorandum: enforcing PRC money judgments in Singapore

The Memorandum requires that the PRC judgment to be recognised and enforced must:

  1. Be a money judgment
  2. Be final and conclusive – a certificate may be obtained from the PRC Court to that effect
  3. Not amount to the direct or indirect enforcement of any foreign penal, revenue or public law
  4. Stem from a dispute which the PRC Court had jurisdiction to determine; the question of jurisdiction being determined by the Singapore Courts under Singapore law (with guidelines set out in the Memorandum)

The PRC Courts will not re-examine the merits of the judgment or allow it to be challenged on the ground that it contains an error of fact or law.  Only limited grounds for challenge exist, for example, where there are issues of public policy, fraud, or natural justice issues including where the litigant had not been given a fair hearing.

Procedure for enforcing a PRC money judgment in the Singapore courts
The judgment creditor is to commence an action by filing a Writ of Summons, with:

  1. a concise statement of the nature of the claim and the amount claimed; and
  2. a certified copy of the judgment exhibited to the writ.

Leave of court would be required for service of the Writ on a judgment debtor outside of Singapore. The judgment creditor may have to file and serve a statement of claim if necessary. Where the judgment debtor is in the PRC, service should be effected via the assistance of the PRC Courts.

Both default and summary judgment are available to the PRC judgment creditor.

Concluding words

Though the Memorandum is not legally binding, the Courts of both countries have thereby made clear the pre-conditions and procedures for mutual recognition and enforcement of money judgments in commercial cases.  The Memorandum highlights the close ties between Singapore and the PRC, and the judicial co-operation existing between them.

The Memorandum is a step towards the Singapore and PRC Courts' efforts in ensuring that businesses remain fair in the deals that they strike and remain accountable, and is certainly helpful for resolving disputes between parties who are located in different countries.

The Memorandum is particularly relevant for PRC and Singapore parties, and also to international parties who have commercial dealings with PRC counter-parties and who opt for the Singapore Courts as the venue of dispute resolution. 

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This article was prepared by Wei Tu Law Firm and Virtus Law LLP, a member of the Stephenson Harwood (Singapore) Alliance.

Stephenson Harwood China Office; Wei Tu Law Firm
Stephenson Harwood has been actively involved in numerous PRC-related matters across a variety of practice areas. It has an association with independent PRC law firm Wei Tu, based in Guangzhou. Lawyers from Wei Tu have full rights of audience in the PRC Courts and bring significant experience with commercial disputes, including enforcement in the PRC Courts.

Stephenson Harwood (Singapore) Alliance
Virtus Law LLP and Stephenson Harwood LLP are registered as a Formal Law Alliance in Singapore under the name Stephenson Harwood (Singapore) Alliance. The Alliance enables us to offer clients an integrated service in multi-jurisdictional matters involving permitted areas of Singapore law. Virtus Law LLP is able to take legal action and represent clients in the Singapore courts.

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